Shrimp raw material prices up in India, down in Thailand : April 8, 2015
Tom Seaman – UNDERCURRENT NEWS
Prices for shrimp raw material in India are rising, while the opposite is happening in Thailand.
In India, packers have liquidated inventories they had in stock and are buying again, as the main production season approaches. Yet, harvesting has not yet started to improve.
With Thailand, packers were buying in bigger volumes in the run up to “Songkran” water festival from April 13-15, the Thai new year celebration. This caused prices to rise, but they are now coming down again as plants slow down buying, in anticipation of going on holiday during the festival.
For both Thailand and India, shrimp raw material landings are reported to be below what was expected.
In India, this has seen prices increase across the board, particularly on 30 counts (see below).
“It appears that farmers are taking it slow on harvesting as they reckon the price should go upward,” said Chaipat Kunapiwatkul, business development manager with Siam Canadian Group, a Bangkok, Thailand-based frozen seafood supplier.
Most of the inventory that packers were holding has been used up and some have to make new purchases for pending orders to China and Vietnam, he told Undercurrent News. “The harvesting was expected to be improving starting from April, but that has not occurred as yet.”
The next two weeks will be very interesting, he said. “Both farmers and packers will flex their muscles and that is how the new season is going to start.”
Processors more focused on North America, he said, are likely to be taking more precautions when it comes to new orders with farmers.
Just before the Boston seafood show, Indian packers were being aggressive on looking to get orders.
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 has stabilized because the Indian fiscal year ends on March 31.
“Almost all packers are now free from financial pressure, because the fiscal year is over,” said Kunapiwatkul.
In Thailand, prices were rising, having dropped rapidly after the Boston seafood show.
They are now dropping again, as packers reduce buying as the Songkran festival approaches.
With Songkran starting on April 13, Thai shrimp factories will be closed for at least five days, with some shutting for as long as ten days.
“Usually, two weeks before long holiday, Thai packers will be buying shrimp raw material more aggressively and temporarily increasing their production, trying to complete all, or as much as possible, of their pending shipments booked to go in April or early May,” said Satasap Viriyanantawanit, general manager for Thailand with Siam Canadian.
“Basically, factories are trying to make-up productions during the time they will be closing for holiday. It is actually going to be “win-win” deal between factory and its workers, because most of workers always enjoy extra money they can get paid from overtime,” he told Undercurrent.
In addition, landings have been poor, which had further seen the raw material price climb, he said.
“I assume that the majority of current orders in Thailand should be small sizes. For example, CPTO 51-60 to 71-90, EZ peel 41-50 and 51-60, raw P&D tail-off 51-60 to 71-90,” said Viriyanantawanit.
Shrimp prices for these particular sizes — head-on raw material count 75 pieces per kg and smaller — have been rising over the past two weeks.
However, shrimp prices in Thailand have started to drop sharply this week. “I understand that some major packers are preparing to close for holiday and trying to obtain minimal amount of raw material,” said Viriyanantawanit.
As for price development after Songkran, “we will have to see”, he said.
It is “more than likely” that prices will jump up the week after the holiday and then start to come down and settle the following week, said Viriyanantawanit.
According to prices for auction in Mahachai, prices for shrimp smaller than 60 pieces per kilogram have all come down between April 4-7 (see below).
Prices for 70 count went from THB 155/kg to THB 150/kg and prices for 80/kg went from THB 148/kg to THB 138/kg.
Contact us : Siam Canadian Group Frozen Seafood Exporters for more formation: