Indian shrimp export growth is expected to slow down after four years of robust expansion due to stiff competition from other suppliers, according to a report.
Indian shrimp export growth is expected to slow down after four years of robust expansion due to stiff competition from other suppliers, according to a report. The report estimates volume growth likely to be 7-10% (compound annual growth rate during CY19), against 17% (CAGR between CY13 and CY17) and adds that stiff competition could result in a demand-supply mismatch and induce volatility in shrimp prices, said rating agency Icra.
Icra reports that while demand from China and US is likely to grow, the European and Japanese markets are expected to remain weak. According to the report, Chinese shrimp demand will be driven by low domestic production growth, coupled with growing domestic shrimp consumption. This coupled with any potential trade agreements (under negotiation) between India and China is expected to augur well for Indian shrimp exports.
As for the other key export destination — the US — the impact of implementation of Seafood Import Monitoring Programme (SIMP) for shrimp exports into US is a key factor to be monitored. SIMP mandates stringent data requirements to trace the entire supply chain of seafood from the point-of-harvest to the point-of-entry into the US.
“The country derives almost 87% of its shrimp export demand from the US, EU (European Union), China, Vietnam and Japan. The healthy growth in the past four years was attributed to weak production dynamics in other major shrimp producing nations, such as Thailand and Vietnam, leading to strong uptick in demand for Indian shrimp,” Pavethra Ponniah, vice-president and head for corporate sector ratings, ICRA, said.