W45 Shrimp Update

In W45 in the Shrimp landscape, global aquaculture shrimp production is expected to reach approximately 6.3 million tons in 2023, a year-on-year (YoY) increase of 5%. As of Otc-23, shrimp production in Ecuador and India has increased by 14% and 2% YoY, respectively. On the other hand, production in Thailand and Indonesia has dropped by 9% and 13% YoY respectively. It is worth noting that Vietnam’s shrimp production has decreased 32% YoY. The main reason for the production decline in Vietnam is the decreased global demand in 2021 and 2022, negatively affecting Vietnam's domestic shrimp prices and cultivated areas. In addition, the high production cost in Vietnam due to its high-density farming model also narrowed farmers' profit margins.

Furthermore, the United States (US) imported 70.7 thousand metric tons (mt) of frozen shrimp to the value of USD 579 million in Sep-23, a 9% YoY increase. However, the accumulated shrimp import volume for the first nine months of 2023 reached 576 thousand metric tons, an 11% YoY decrease. Despite the recovery in import volumes during September, the overall import volume for the year is expected to be lower compared to 2022, given the significant decline in imports during the first half of 2023. India, the largest shrimp supplier to the US, exported 28.99 thousand mt in Sep-23, representing a 1.5% YoY increase but a 4.67% month-on-month decrease. In compassion, Ecuador exported 18.5 thousand mt in Sep-23, representing a 22.47% YoY increase and a 0.39% month-on-month decrease. It is worth noting that the United States International Trade Commission (USITC) is expected to decide before November 15 regarding the launch of an anti-dumping investigation into shrimp products from India, Ecuador, Indonesia, and Vietnam. A resolution vote is expected to be held on December 8, which may create uncertainty in the market.

Ecuador’s shrimp industry has experienced a significant drop in farm prices since the start of Nov-23 due to unexpected low orders from the Qingdao Fisheries Expo held from October 25 to October 27, 2023. Particularly, the price of shelled shrimp at the pond entrance fell USD 0.10 to 0.30/kg compared to the price before the exhibition. According to a recent report by the Ecuadorian Chamber of Aquaculture (CNA), the shrimp industry in Ecuador is currently facing an unprecedented crisis. The ongoing economic turmoil and plummeting international prices have intensified the challenges posed to the industry. While the shrimp industry has always contributed significantly to the country's economy, it is now facing significant uncertainty due to the economic difficulties in its major export destinations.

Lastly, the National Chamber of Aquaculture (CNA) in Ecuador has warned that the shrimp farming sector could face a significant risk if the El Niño phenomenon occurs. This risk amounts to more than 50% of the productive area with over 110,000 hectares. The CNA highlights concerns on the farms in lowlands, such as beach areas and bays. The country must be prepared in advance to maintain a safe production environment.