Image: Vasep / FIS

Falling Raw Shrimp Prices: Another Challenge the Shrimp Industry Must Overcome

VIET NAM
Friday, June 28, 2024, 07:00 (GMT + 9)

Raw shrimp prices in the Mekong Delta provinces have tended to decrease sharply since May until now.

According to shrimp price records on June 12 in Kien Giang province, black tiger shrimp decreased from 30,000 - 40,000 VND/kg (USD 1.18 - 1.57) depending on size compared to 1 month ago. Specifically, black tiger shrimp of 20 - 30 shrimp/kg traders buy at 250,000 VND/kg, down about 40,000 VND/kg (USD 1.57). 50 black tiger shrimp/kg 1 month ago was priced at about 130,000 - 135,000 VND/kg (USD 5.11 - 5.30), now reduced to 95,000 VND/kg (USD 3.73).

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For 100 pieces of white shrimp/kg, traders buy it at a price of 66,000 - 70,000 VND/kg (USD 2.59 - 2.75), a decrease of about 20,000 VND/kg. Vannamei shrimp 50 - 60 shrimp/kg price is 73,000 VND (USD 2.87), down 30,000 VND/kg. White shrimp of 70 - 80 shrimp/kg is priced at 70,000 VND/kg (USD 2.75), down 25,000 VND/kg (USD 0.98).

Similarly, the price of white leg shrimp in the provinces of Ca Mau, Bac Lieu, Soc Trang, Ben Tre... is also at a low level, dropping sharply compared to the beginning of the year.

The reason for the sharp drop in shrimp prices, according to some businesses and traders, is that supply exceeds demand. Besides, shrimp is in season, the weather is favorable, so the harvest is large; At the same time, companies purchasing shrimp for export reduced production. Shrimp export activities of enterprises also face many difficulties due to slow market demand, supply chain congestion due to increased freight rates and lack of containers, and Red Sea tensions.

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Meanwhile, shrimp prices from India, Indonesia, and Ecuador are offering low prices. Consumption prices on the world market remain low and Ecuadorian shrimp continues to be sold at increasingly cheap prices.

Prices of raw shrimp from world supplies have decreased

Prices of raw shrimp from major suppliers in the world have decreased. Raw shrimp prices in China in week 25 (June 17-23, 2024) fell to nearly the lowest level in a decade as production reached a seasonal peak. Shrimp size 60/kg decreased by 22% and shrimp size 80 decreased 25% compared to the previous week. Prices are currently near decade lows last recorded in the summer of 2020 during the COVID-19 pandemic. China's shrimp production is expected to remain high in June and July.

Ecuadorian shrimp prices in week 24 (June 10-16, 2024) reached about 3.90 USD/kg for type 20/30 and 3.50 USD/kg for type 30/40. Prices of shrimp sizes 40/50, 50/60, 60/70, 70/80 and 80/100 remained unchanged at 3.30 USD/kg, 3.15 USD/kg, 2.80 USD/kg, 2.30 USD/kg. USD/kg and 1.90 USD/kg.

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Excess supply causes selling prices to plummet, which also affects farmers' profits and ability to maintain sustainable operations.

In week 25, in the main shrimp farming state of Andhra Pradesh, the price of 60-sized HOSO shrimp was 260 INR (3.12 USD)/kg; 280 INR/kg for 50 animals; and INR 320/kg for 40 animals.

Prices for the smallest shrimp category -- 100 shrimp/kg -- remain significantly lower than last year's level, down 17% compared to the same week in 2023. The situation is similar for the 60 shrimp category -- prices are down 10% compared with the same period last year.

The reason for the decrease in Indian shrimp prices is due to increased shrimp supply, processors do not pay higher prices because of the gloomy export market.

In Indonesia, raw shrimp prices continued to decline across all sizes in week 25. Prices have now decreased by 10% for size 30 shrimp and 8% for size 60 shrimp over 5 weeks.

<-- Source: Stockfile FIS 

Raw shrimp prices in Indonesia have dropped as processors tried to push prices down when the US imposed new anti-dumping taxes.

Shrimp prices in the coming time are unclear, because in addition to market demand factors, it also depends on the main crop of shrimp powers such as Eucador, India, and Vietnam. Ecuador is even more difficult to predict because they can raise shrimp all year round.

According to some businesses, it is still impossible to say whether shrimp prices will increase again or not, but the possibility of shrimp prices decreasing further will be very unlikely, because recently a few businesses have raised their purchasing prices, although not by much. shows that businesses still have a need to purchase raw shrimp. Raw shrimp prices are likely to increase again at the latest in August when the main harvest in world supplies is over and demand from markets is more positive in preparation for the end of the year.

Authorities have advised farmers to stabilize their mentality, avoid mass harvesting of farmed shrimp, maintain stable stocking with lower densities, and extend farming time to increase the size of large-sized harvested shrimp. Ensuring quality and food safety, increasing selling prices, thereby increasing investment efficiency. Or you can increase farming density to increase harvest output, gradually prune, and the remaining quantity in the pond will have a favorable environment for faster growth. Proactively coordinate with relevant agencies and units to grasp the price developments of raw shrimp, analyze production efficiency of each size of harvested shrimp, and forecast demand developments in the consumer market.

Source: Stockfile FIS 

In the long term, if we want to reduce production costs and create new resilience for shrimp, helping shrimp farmers ensure profitable production, promoting production linkage models along the value chain must be considered. more and more. Along with that, there is a strategy to develop the food processing industry and materials for shrimp farming, towards self-reliance. At the same time, constantly improve the farming process, strictly control the quality of breeds, materials and especially good environmental management to aim at forming and building modern and sustainable shrimp farming models. Production costs are low and bring high profits to shrimp farmers.

In the first 5 months of this year, Vietnamese businesses exported shrimp to 103 markets, bringing in 1.3 billion USD, up 7% over the same period last year. Although the shrimp industry continues to face many challenges as the world economic situation shows no signs of recovery and inflation is still high, shrimp export turnover in the first 5 months of the year recorded a slight increase over the same period. Positive signals, especially demand from the EU, Japan, and Korea markets have shown signs of increasing again.

Author: Kim Thu | Vasep (Translated from the original in Vietnamese)

[email protected]
www.seafood.media

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