Shrimp raw material prices from Thailand – the world’s largest exporting country – are firm, but processors are hoping for some respite over the next six months.
Although there is some long-term respite from high prices in sight, the short term situation is tougher, said Jim Gulkin, managing director of Bangkok-based frozen seafood supplier Siam Canadian Group.
“If we are looking over the next six months, I would agree,” said Gulkin. “But there will be strong demand on raw material until early November to get holiday orders shipped out, so that’s where the uncertainty lies.”
Prices would have usually started to ease off at this time of year, said Choopong Luesukprasert, managing director of Thai processors and exporter Marine Gold Products.
However, the flooding earlier in the year meant that the farmers had to re-seed ponds and production will come later, he told IntraFish. “I don’t see prices dropping much.”
Although prices are high, 2011 is a far better year for packer than 2010.
“Last year, prices were bad for the packers. This year, the prices are still high, but the packers can make a profit and so can the farmers,” said Aekarat Punnasung. assistant managing director with Asian Seafoods Coldstorage.
Prices from Thai farmers have been volatile and high, but are expected to be more stable over the rest of the year, said Vichittra Aramwattananont, vice president of Wales Group, a diversified Thai seafood group canning tuna and producing frozen seafood products.
“This means we can start working on long-term orders with customers again, like six month contracts,” she told IntraFish.
Sea Wealth and other packers had been selling on a month-to-month basis, because of the price volatility. Now it will look to do more six months contracts on large volumes, she said.
However, price stability depends on factors such as the climate, which is changing, said Siriwan Dusdeevutikul, vice president and marketing business director with family owned packer, PTN Group.
“We have seen strong prices this year. The flooding hit production for the farmers and caused prices to stay high, she told IntraFish.
“Also, the climate has caused a lot of the shrimp to die. When we were at the Boston seafood show, it was good weather in Boston, but it was freezing in Bangkok,” she said. “Now every day we are seeing rain. It is not usual.”