W5 Shrimp Update: Chinese Shrimp Prices Hold Steady Pre-Lunar New Year, US Industry Faces Contraction Despite Lower Prices

Chinese Shrimp Prices Remain Elevated, Lunar New Year Surge Anticipated

Shrimp prices in China have remained notably elevated throughout January, with further escalations anticipated leading up to the Chinese Lunar New Year on February 10, 2024, fueled by traditional demand surges. In Guangdong province, a hub for shrimp cultivation, prices surged to over USD 8.44 per kilogram (kg) in the initial weeks of the year before receding to approximately USD 7.44/kg in subsequent weeks.

This fluctuation was due to premature shrimp harvesting driven by adverse weather conditions and disease outbreaks. Meanwhile, Jiangsu province reported stable prices, while Shandong observed a slight decline amid expectations that seasonal demand had yet to peak. In terms of imported shrimp, Ecuadorian export offers witnessed an uptick from the previous month, with suppliers quoting USD 5.40/kg for size 23/30, USD 4.70/kg for 30/40, and USD 4.50/kg for 40/50. China's largest shrimp importer, cited these elevated prices as deterring Chinese buyers, resulting in diminished order placements from Ecuador. Despite expectations of potential price doubling for live and fresh shrimp leading up to the Chinese New Year, increased winter greenhouse production in recent years has somewhat moderated the price growth compared to historical trends.

US Shrimp Industry Faces Contraction in 2024, Despite Lower Prices

The United States (US) shrimp industry is forecasted to experience a contraction in the first half of 2024 despite lower prices, according to insights shared at the 2024 Global Seafood Marketing Conference. Industry executives anticipate a difficult first half of 2024, with a potential contraction across the seafood sector, particularly impacting shrimp imports. Shrimp remains a significant segment within frozen seafood sales, accounting for 52.6% of the category in 2023. However, the shrimp category also witnessed the highest absolute USD decline, falling 8.2% (USD 321 million) compared to 2022.

Frozen shrimp household penetration declined across all outlets in 2023, with the most significant drop occurring in value grocery stores. Despite a 3% decrease in average frozen shrimp prices to USD 9.21 per pound (lb), sales were projected to decline in 2023. Factors contributing to the contraction include the end of some COVID-era benefits, impacting low-income consumers and resumption of student loan repayments, reducing disposable income and inability to fully capitalize on lower shrimp prices due to existing inventory.