China, Vietnam, Thailand shrimp raw material hard to come by : October 16, 2012
Tom Seaman : Undercurrentnews
Raw material landings of shrimp in China are around 20% down on 2011, said Jim Gulkin, managing director of frozen supplier Siam Canadian Group, who is currently in China on business.
In 2011, the raw material volume in China was 1.2-1.3 million metric tons and this year it will be around 1 million metric tons, he said.
“The shortages are occurring due to pond overuse – i.e. not cleaning up and drying out long enough after harvest so ensuing crop has higher chance of disease problems,” he told Undercurrent News.
Some shrimp farms have problems with post larvae and some are switching over to fish, such as tilapia, pomfret and grouper, he told Undercurrent.
The domestic consumption in China is also still strong and growing with no apparent sign of decrease, “despite the supposedly slowing economy”, he said.
“There are more processing facilities coming on line, so increased production capacity is also keeping upward pressure on raw material,” said Gulkin.
“Everything we hear about China is that they are becoming very aggressive in purchasing shrimp for their domestic demand, which their domestic production cannot meet,” said a US buyer.
The high raw material prices in Thailand, which can be seen in the Undercurrent News prices portal, are being driven by poor availability, said an executive with a Thai shrimp firm.
“Prices in Thailand as well as in Vietnam increase dramatically. This is because of low availability,” he told Undercurrent. “And some shrimp farming areas in Thailand have problems with early mortality syndrome (EMS), the same as in Vietnam.”
The prices in the US market, which you can also look at in our prices portal, are down dramatically for shrimp across the board and imports into the US market are also down.
The Thai shrimp executive cites the volumes of Indian shrimp going into the US market as the main cause for the depressed prices.
“Prices in [the] US dropped a lot because India dumped stock in the US, due to the problems with exports to Japan,” he said.
A US-based executive said the fact the top ten exporting countries into the US are showing negative figures for August 2012, compared to August 2011, is very irregular.
“This is very unusual, particularly when there have been no adverse conditions like we have seen in the past few years, such as heavy flooding, viruses, abnormal high temperatures, and currency exchange problems,” he told Undercurrent.
“Thailand sticks out like a sore thumb. They were and were down 23.7% [in volume] for the year to-date comparisons,” he said.
“Most packers we talk with report a lack of raw material,” he said. “A number of reasons could be possible: higher feed costs; higher energy costs; and crop losses earlier in the year, due to very high temperatures causing massive early harvesting.”