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More than 70 percent of Chinese shrimp output goes to domestic demand but that figure is set to rise as domestic buyers are willing to pay “as much as 10 percent more” than the export-processing sector, said Landy Chow, China head of sourcing specialist Siam Canadian.

Chow believes Chinese shrimp shipments to the U.S. will be down 10 percent in 2013, having slipped 6 percent year-over-year from January to June. “American customers aren’t willing to pay the higher prices…while Chinese domestic buyers are.

Meanwhile, in order to satisfy demand at home, Chinese buyers have headed to India and Latin America to buy up available supply: 500 containers shipped from India to China has pushed average Indian shrimp prices up USD 2 (EUR 1.51) or 25 percent in July as a result, according to Chow.

Chinese exporters are now seeking to renegotiate earlier agreed prices with customers. “It’s a very, very difficult situation…they stand to lose a lot of money. Unfortunately the options are limited: supply in Vietnam is down 30 percent while Thailand shrimp supply is down 50 percent due to disease.

The one bright spot in Asian shrimp production, Indonesia, unfortunately has insignificant volumes — 150,000 metric tons (MT) compared to China’s 1 million MT — and all of that is going thus far to the U.S., where it enjoys zero-tariff access (unlike Chinese product, which pays countervailing and anti-dumping duties.)

A 25 percent surge in Chinese prices so far this year is being caused by a shortage of supply due to poor quality feed and broodstocks, explained Chow. He believes Chinese feed companies have responded to higher soy and fishmeal prices by diluting the mix rather than rising prices to Chinese end users.

“We’re getting less than 80 pieces per kilogram but we used to get well over 80 pieces in previous years,” said Chow.

He believes the use of second or third generation broodstock rather than the optimal first generation broodstock imported from North America.

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Contact us for more formation:
Email: info@siamcanadian.com

Siam Canadian Group Frozen Seafood Exporters 
Email: info@siamcanadian.com

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