The global shrimp market is facing a challenging situation as prices stabilize at “unfavorably low levels,” leading to financial hardships for many farmers. This trend is particularly evident in India, where raw vannamei exports averaged USD 6.32 (EUR 5.80) per kilo in September, marking a significant decline from USD 7.54 (EUR 6.92) in September 2022 and USD 6.55 (EUR 6.01) in July 2023. While there was a slight uptick from the USD 6.29 (EUR 5.77) recorded in August 2023, overall prices remain at concerningly low levels.
Several factors are contributing to this downward pressure on shrimp prices. One key factor is the weakening of the Chinese market, which has been impacted by economic challenges such as stalled real estate development, defaulting developers, and falling home prices. These issues have dampened demand for shrimp in China, a significant consumer of the seafood.
Despite cooling inflation, the U.S. market has shown some signs of recovery, importing more shrimp year-over-year in August and September. However, this increase in U.S. imports has not been enough to offset the decline in demand from China.
The prolonged low prices are putting immense strain on shrimp farmers, pushing many into loss-making situations. The Shrimp Insights Founder Willem van der Pijl highlights the severity of the situation, stating, “Prices are ‘quite low,’ pushing many farmers into a loss-making situation.”
The International Monetary Fund (IMF) has also expressed concerns about the Chinese economy’s impact on global shrimp markets. In its November World Economic Report, the IMF downgraded its growth expectations for China, citing the troubled property sector as a significant risk factor. The IMF’s report also noted that China’s government has been hesitant to introduce substantial fiscal stimulus measures to boost growth, further clouding the outlook for the shrimp industry.
The Chinese Aquatic Producers Promotion and Marketing Association (CAPPMA) Secretary General Cui He acknowledged the challenges facing the Chinese shrimp industry, stating, “China is currently facing a complex and volatile international economic environment.”
The stabilization of global shrimp prices at unfavorable levels poses a significant threat to the livelihoods of shrimp farmers worldwide. As the situation continues to unfold, it is crucial for industry stakeholders and policymakers to work together to find solutions that support the sustainability of shrimp farming and protect the livelihoods of those who depend on it.
editor
27 November 2023