Market chaos spoils seafood exporters hopes

Written by Commodities Bureau | Kochi, Oct 10 | Updated: Oct 11 2008, 08:21am hrs
Failure of several banks and the uncertainty in the global financial system is giving sleepless nights to seafood exporters, who were hoping for a good time with rupee weakening against the dollar and catch of several species being on the increase. Exporters also expect the consumption of high-value species like shrimp and codfish, which bring most of the export revenue, to decline in the recessionary market as consumers turn more value conscious.

Exports were recouping some of the losses of the last fiscal with the rupee falling to lower levels, Anwar Hashim, national president, Seafood Exporters Association of India (SEAI), told FE. Exports for August and September were good in relative to the performance of FY07 and the scenario was beginning to improve, he added.

Compared to 2006-07, the volume of exports for 2007-08 fell by 11.58%, while value declined by 8.88%. According to estimates of the state-run Marine Products Export Development Authority (MPEDA), exports during 2007-08 stood at 541,701 tonne valued at Rs 7,620.92 crore as against 6,12,641 tonne valued at Rs 8,363 crore in 2006-07.

Domestic factors like the size of the catch are encouraging as both fishermen from the eastern and western coasts are reporting improvement. The catch of species like mackerel and squid are on the increase, as comapred to the previous season, he said.

Compared to the last season the rupee realisation for a dollar has improved by almost Rs 8-Rs 10 giving more scope and flexibility for exporters.

The weakening of the Euro against the US dollar may mean lesser consumption from Europe as the trade is still dollar-denominated. But the Japanese market looks good with the yen appreciating against the US dollar, Hashim said. However, the uncertainty in the global markets has begun to outweigh the positive factors as exporters fear trading in such chaotic conditions, he explained.