World production of farmed shrimp could be 10% lower in 2015 than in 2014 due to falling prices
During the first nine months of 2015 shrimp imports in the USA increased marginally, while the trend was negative in the EU and Japan. In contrast, imports were higher in the growing markets of Asia and the Middle East, supported by lower market prices.
Supply
The estimated production in 2015 of 2 million tones of farmed shrimp is a result of reduced aquaculture efforts due to disease problems in China, India, Ecuador, and Viet Nam. In these main producing countries, farmers lowered their stocking density to reduce or avoid disease occurrence.
In Viet Nam, Farmers reportedly shifted from Vannamei back to black tiger aquaculture due to the supply/demand imbalance for vannamei shrimp. Falling shrimp exports and increased imports into Viet Nam also confirmed lower farmed shrimp production in the country.
In India, Tumbling market prices and unfavorable weather conditions impacted farmed production in 2015, which could be as much as 10-20% lowers than in 20147. The situation is no better in Indonesia, where lower demand in shrimp feed and reduced exports to some important markets are indicators of falling production volumes during the second half of 2015.
Thailand was the exception to the rather somber situation of shrimp farming in Asia with production increasing in 2015 for the first time since 2012 to 260000 tonnes. This trend Is forecasted to continue in 2016, with production estimated to increase by 10%.
In Ecuador, Latin America’s top shrimp producing country, farmers reduced stocking density beginning in Sep 2015 to avoid disease issues. In Mexico, the disease situation has weakened, and farmed shrimp production recovered to reach 80,000 – 85,000 tonnes in 2015, compared with 70,000 tonnes in 2014.
In general, raw material prices in Asia have started to increase beginning in Dec’2015 as the aquaculture industry is in the low production season form November 2015 through April 2016.
In Argentina, 2015 was a record year for shrimp catches with 1, 40,000 tonnes landed, representing an increase of 10% over 2014. This increase in landings, coupled with the strength of the USD and the negative effect on process, which have maintained a downward trend for all of 2015. This negative trend is likely to continue well into 2016, as inventories are high with the previous year products and there have already been strong catches in 2016.
Import and Export Trends
Despite a softer price trend in international trade, shrimp imports in the traditional developed markets remained disappointing during Jan-Sep 2015 compared with the same period of 2014. Shrimp imports rose marginally in the leading market, the USA, by only 2.1% and declined by 1.6% to the EU (during Jan-Aug 2015) and by 3.4% in Japan, as both markets were affected by lower currency values. There was notable 20% fall in Australian imports for a similar reason. However, there were higher imports into the Republic of Korea (+11.6%), China (+24%), Taiwan PC (+11%) and Canada (+22%).Viet Nam remained an attractive market for frozen shrimp, where imports almost doubled during the review period.
Compared with 2014, shrimp exports from the top two global sources, India and Ecuador, increased by 10% and 15% respectively at 2,80,000 tonnes and 2,57,000 during the first nine months of 2015. However, export revenues were lower due to the weak market prices. For India, the leading export markets were the USA, Viet Nam, the EU, Japan and China. Indian exports increased to Kuwait, Qatar and Egypt in the Middle East and to neighboring Sri Lanka and Maldives. For Ecuador, Viet Nam was the export market followed by the EU, the USA, China and the Republic of Korea. It is interesting to note increased exports from this source to non-traditional Asian markets.
For the first nine months of 2015, exports also increased from Thailand (3.4%), dominated by value -added shrimp. Indeed, in the US and Japanese markets, 63% and 66% of shrimp exports from Thailand consisted of prepared shrimp products. There were lower exports (-22%) by China, while in Viet Nam, exports were estimated to be 1, 75,000 – 1, 80,000 tonnes during the review period, also a substantial decline over 2014.
Japan
Lower prices of farmed shrimp have strengthened demand in the retail and catering trade in Japan since mid-2015.Japanese supermarkets started promotional campaigns of tropical shrimp in July/August as well as in December as part of year –end sales. Demand for large sizes of Vannamei, black tiger and sea-caught shrimp were also strong in the catering trade, with domestic inventories of these products low. In December 2015, export prices of 16/20 counts headless black tiger shrimp from India were USD 10.50 per kg, which was more than USD 1.00/KG CHEAPER THAN A YEAR AGO.
Despite lowering prices, total shrimp imports in Japan during January-September 2015 declined by 3.3% compared with the same period in 2014. Imports for prepared shrimp and sushi shrimp with rice did increase by a notable 21% compared with the same period in 2014. These trends also continued in October 2015.Thailand and Viet Nam were the leading suppliers of value added shrimp in Japan.
USA
The US Shrimp market remained shaky throughout 2015 due to unstable wholesale prices while inventories remained high in local distribution channels as well as with importers. In addition, Mexican wild brown shrimp inventories are still being carried over from last season’s production. Persisted and more shrimp is expected in the coming months from Mexico and Latin America. Subsequently, importers remained conservative despite a general weakening in import prices.
Total import value of shrimp in the USA fell by 18.4% during the first nine months of 2015 compared with the same period in 2014. Quantitatively, imports increased b 2.1% during this period. Among the top sources, suppliers increased from India, Indonesia and Thailand but declined from Ecuador and Viet Nam.
There was a 3% decline in shell-on shrimp imports, while peeled shrimp imports increased marginally in the USA. These two product groups had a 77% share in US total shrimp imports during the first nine month of 2015. Imports of breaded shrimp and some other prepared shrimp items increased slightly, reflecting a general rise in market demand. Since the fourth quarter of 2015, some positive movements in consumption have been observed. During the year-end and New Year sales period, shrimp prices were firm at the wholesale level.
EU
Throughout 2015, overall demand in EU shrimp trade remained weak even with lower import prices, especially as the prices expressed in euro were going up. Extra-EU imports of shrimp into the community market declined by 1.6% during Jan-Aug 2015, compared with the same period in 2014.Supply trends from the top five exporters to this market were mixed during this period. Supplies increased from Ecuador, Argentina and Viet Nam, but declined from Greenland and India.
Among the top five individual markets in the EU, shrimp imports during the review period increased in Spain by 8%, in France by 23.7%, but declined in UK by 6% and Italy by 6% and in the Netherlands by 4.4% and Italy by 6% compared with the same time period in 2014.In the non-EU markets, imports also remained weak during the reporting period. Imports were lower in Switzerland and Norway by 10.5% and 1.3%. There was a large slide(-60%) in Russian shrimp imports to total only 14,598 tonnes during the first nine months of 2015 compared with the same period a year ago, mainly due to the food embargo enforced by Russia during the period. Export prices of shrimp declined sharply in the European market during Nov/Dec 2015, partly as a result of the Paris terrorist attacks. The relative strength of the US dollar, especially during early December 2015, has been favoring countries, such as Ecuador, India and Indonesia, quoting in dollars. Demand from the market is focused on middle and smaller sizes. Nonetheless, demand in the post New Year market remains sluggish.
Outlook
In general, farmed shrimp supply will be low in Asia until the new season’s harvest is available, at the earliest April. Meanwhile, demand in Southeast Asia is already growing with strong prices in response to the Lunar New Year demand in February. In most of the producing countries in Asia, raw material prices have bottomed out and have started to increase. Improved consumer demand has been observed in the USA and Japan since late 2015. As a result o f all of these trends market is likely to show sighs in 2016. In contrast, the European market is well supplied, especially with heavy shrimp landings from Argentina, so no price increases are likely for the first quarter of 2016.
Source : Aqua Tech