How Is the Value Chain Formed?
Frozen Shrimp Value Chain
Harvest (Farmers) -> Sorting (Farmers) -> Processing (Processors) -> Freezing (Processors) -> Packaging (Processors) -> Export
Farming
- Private farmers working together (cooperative) is the norm and is a lucrative business yielding higher net profits than other occupations.
- Monoculture, meaning these farms only produce prawns and not other crops.
1. Fry Production
- Large-scale hatcheries operate fry production
- Fry production is centralized in the regions of Chachoengsao, Chonburi, and Phuket
2. Aquaculture
- When the fry/larvae has matured, it is transported to aquaculture ponds for further shrimp growth
- Aquaculture ponds are mostly operated by families and small businesses
- Only a few conglomerates operate in this stage of the value chain
Local Trade
Once the shrimp has fully matured, they are harvested and sold to:
-Local Market
-National wholesaler or retail outlet
-Processors
- Exporting Companies
Some producers employ local agents to sell on their behalf, but this is not very common. More often, brokers will approach farmers and purchase from them, and sell to processors at a slim margin.
Processing / Logistics
Done by large unions like Thai Union.
- Bulk of exported shrimp is minimally processed - sold whole
- HOWEVER, import markets like the US and EU prefer cut shrimp for easy use of the frozen good
- Large industrial scale processing plants and peeling sheds will further process the shrimp before exporting (peeling, deheading, deveining, cutting → labour-intensive)
- Once peeled, the shrimp is frozen and shipped to the exports market
- Only companies that are registered under the Thai Frozen Foods Association (TFFA) can export
Wholesale, Retail, Import
Importing entities are usually large conglomerates that buy in large quantities and redistribute to various channels:
-Food Manufacturers
-Retailers → make branded producers
-Food service providers (e.g. restaurants)
-Consumers & Retailers
