Indian shrimp prices rise across all sizes on demand from China, Vietnam : March 24, 2015
Tom Seaman – UNDERCURRENT NEWS
Prices for Indian vannamei shrimp increased across all sizes this week, driven by demand from China and Vietnam and low availability.
The rate of increase varies from size to size and comes after several weeks of falling prices, as packers liquidated inventory.
“There is some completion for raw material as buy
ers in Vietnam and China have come in. I think it’s a case of them seeing value in the product, which hit a certain low point, which is then seeing the prices increase,” an Indian shrimp executive, source A, not wishing to be quoted by name, told Undercurrent News.
A second executive with an Indian packer, source B, confirmed the picture.
“There are lots of orders coming in from Vietnam and China, which has seen prices rise across the board,” source B told Undercurrent.
There was a development in demand for Indian shrimp in Vietnam last year for re-processing, he said. “Up until September last year, Indian shrimp was only really being shipped to Hai Phong in Vietnam, for transit into China. From September, the deliveries were also going to Ho Chi Minh City, for re-processing.”
This source, fresh from a trip to Vietnam, said he feels demand will be there for re-processing in 2015. Orders are also going direct to China from India, as well as via Hai Phong, he said.
“It looks like some of them [Indian packers] are optimistic on demand from China and Vietnam in coming weeks,” said Chaipat Kunapiwatkul, business development manager with Siam Canadian Group.
Packers were being forced to liquidate their inventory in order to please their bankers, who had extended credit lines, he said, as was previously reported by Undercurrent.
This is stabilizing because the Indian fiscal year ends on March 31, he said. “Significant inventories have been liquidated but most of them were at horrible price to packers.”
During the Boston seafood show, the general sentiment was that US buyers are in command and are sitting back, while packers scramble for orders. Indian packers, in particular, were out in force at Boston looking for orders.
As a result, the jump in raw material prices has come as somewhat of a surprise, with reports in Ecuador of the same thing happening post-Boston.
“I did not expect to see the raw material going up after Boston, but this is the picture we are seeing. The lower prices then saw buyers jump back in,” said source A.
Packers are now buying raw material again, mostly for headless, shell-on (HLSO) block 26/30 and below, Kunapiwatkul told Undercurrent.
Prices for 30 per kilogram count raw material are up the most, to meet this demand for 26/30 HLSO blocks.
“The increase varied from INR 10, 20 and 30, depending on the sizes. For example, the increase on 30 counts is INR 30/kg, while the increase for the other sizes is smaller in number,” said Kunapiwatkul.
Source B said the short raw material picture is down to the failure of the crop at the end of last year. This was partly down to whitespot, he said.
This is the low season for production, said source A, disagreeing that disease has anything to do with the situation.
“The arrivals have slowed down, but this is the slow landings season,” he said.
Indian farmers have been seeding from January to March for the next crop.