Siam Canadian’s Gulkin forecasts steady increase in Thai shrimp production : March 19, 2017
Tom Seaman : Undercurrentnews
BOSTON, US — Thailand produced around 310,000 metric tons of shrimp in 2016, with an uptick of around 20,000t expected in 2017 by Jim Gulkin, CEO and founder of Siam Canadian Group.
This is a bit more bullish than the forecast from the shrimp panel at the recent Global Seafood Market Conference (GSMC) in San Francisco, California, where 300,000t was given as the outlook for 2017, flat on the previous year.
“EHP [Enterocytozoon hepatopenaei] disease and weather were the main causes” for production not going up more in 2016, as well as prices being at lower levels for a portion of the year, Gulkin told Undercurrent News, during the 2017 Boston seafood show.
Good prices offer an incentive for farmers to seed and produce, hence his positive view on 2017. But, EHP and the unknown factor of the weather are likely to impact growth somewhat, said Gulkin.
“We will get to 400,000t, eventually, as long as prices support this,” he said.
Also, Thai packers are investing into the industry and planning to get more into farming, he told Undercurrent. “Most of the Thai packers seem pretty bullish on the future.”
For India, Gulkin was more bearish than the outlook given during the GSMC conference. At GSMC, the panel forecasted production of close to 500,000t from India for 2017/2018. “No-one has accurate official figures. It’s a very disjointed and fragmented industry, so it’s very hard to really know.”
The country has issues with disease, such as EHP and whitespot, he said. But, with prices as they are, farmers will increase production, in spite of these issues.
In Indonesia, EHP as well as white feces are impacting production, he said.
The situation in 2017 will be similar, said Gulkin. During the GSMC event, a level of around 250,000t was forecasted for Indonesia, flat on 2016.
For Vietnam, Gulkin said black tiger prices are at a level that will stimulate more production, echoing one of the executives on the shrimp panel at GSMC.
In India, black tiger production has gone from being around 60-75% of production to as little as 5%, giving an opening for Vietnamese farmers, he said. Production in Indonesia has also come down and black tiger is only around 3% of output.
A premium of around $0.30-$0.50 per kilogram is needed to make it worthwhile producing black tiger, which is the current situation, said Gulkin.
For China, the industry is still struggling, he said.
More detail on the picture in China was given in a note from Siam Canadian, published on its company blog.
Early mortality syndrome and other shrimp diseases “are still widespread and no proper structure or plan is in place on the government level or within the private sector to get control of this situation as they have in Thailand and other countries”, wrote Gulkin, on the blog post.
“If China production remains at same level as 2016, white shrimp suppliers believe raw material prices will be the highest among shrimp producing countries,” he added.
“However, the Chinese domestic market seems to be able to accept these levels and consumption remains strong. Shrimp processing factories producing for exports will remain dependent in imports of raw material from India, Indonesia and other Asian countries,” wrote Gulkin.
According to white shrimp suppliers, major China shrimp pond seedings will start to take place late March, but “major improvement” on 2016 is anticipated.
During the GSMC conference, the shrimp panel forecasted production in China would drop below 600,000t, however.
“Land prices have moved up and many shrimp farm areas have been sold for commercial real estate. Hainan which was a major farming area in the past, has seen close to 40% of its shrimp farms was converted to commercial real estate,” wrote Gulkin, in the blog post. “In Guangdong, there has also been a conversion from shrimp farms to commercial real estate, but on a smaller scale.”
Also, an over abundance of sub-standard quality post larvae and feed; industrial pollution affecting many farming areas; and typhoons and flooding will all likely impact production in 2017, wrote Gulkin.
This comes as Siam Canadian looks to get going with an import business in China, having hired a sales person based in Guangzhou.