7 Reasons Why Shrimp Export is a Lucrative Business in 2024

Shrimp export is one of the most profitable sectors in the global seafood industry. According to the International Trade Center (ITC) data, in 2021, the world’s seven largest shrimp exporters (Ecuador, India, Vietnam, Indonesia, Argentina, Thailand and China) exported a total of 2.57 million tons of shrimp products, an increase of 15% over the previous year. The total value of these exports reached $20.7 billion, up 9.5% from 2020.

What are the factors that make shrimp export such a lucrative business in 2023? Here are some of the main reasons:

1. High demand and consumption

Shrimp is one of the most popular seafood products in the world, especially in the United States, China, Japan and the European Union. These markets account for more than 80% of the global shrimp imports. Shrimp is consumed as a delicacy, a snack, a main dish or an ingredient in various cuisines. Shrimp is also rich in protein, omega-3 fatty acids, minerals and vitamins, making it a healthy and nutritious food choice for consumers.

2. Low production cost and high profit margin

Shrimp farming is a relatively low-cost and efficient way of producing shrimp compared to wild capture. Shrimp farmers can control the quality, quantity and timing of their harvests, as well as reduce the environmental impact of their operations. Shrimp farming also offers a high profit margin for exporters, as the average export price of shrimp was $8.05 per kg in 2021, while the average production cost was around $3 per kg.

3. Diversified product portfolio and market opportunities

Shrimp exporters can offer a wide range of products to meet the different preferences and needs of their customers. These include fresh, frozen, cooked, peeled, breaded, value-added and organic shrimp products. Shrimp exporters can also explore new market opportunities in emerging regions such as Africa, the Middle East and Eastern Europe, where shrimp consumption is growing rapidly.

4. Innovation and technology

Shrimp exporters can leverage innovation and technology to improve their production efficiency, product quality and market competitiveness. For example, some exporters use artificial intelligence (AI), blockchain, traceability systems and e-commerce platforms to optimize their supply chain management, ensure food safety and security, and enhance customer satisfaction and loyalty.

5. Sustainability and social responsibility

Shrimp exporters can adopt sustainable and responsible practices to protect the environment, support local communities and comply with international standards and regulations. For example, some exporters use recirculating aquaculture systems (RAS), biofloc technology, probiotics and natural feed to reduce water usage, waste generation and disease outbreaks. Some exporters also obtain certifications such as Best Aquaculture Practices (BAP), Aquaculture Stewardship Council (ASC) and Fair Trade to demonstrate their commitment to environmental and social responsibility.

6. Government support and trade agreements

Shrimp exporters can benefit from the support and incentives provided by their governments to promote the development of the shrimp industry. These include subsidies, tax exemptions, loans, infrastructure development, research funding and technical assistance. Shrimp exporters can also take advantage of the trade agreements signed by their countries with major shrimp importing markets, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Regional Comprehensive Economic Partnership (RCEP) and the European Union-Vietnam Free Trade Agreement (EVFTA). These agreements can reduce or eliminate tariffs, quotas and non-tariff barriers for shrimp exports.

7. Resilience and adaptability

Shrimp exporters have shown remarkable resilience and adaptability in facing the challenges posed by the COVID-19 pandemic, which disrupted the global seafood trade in 2020 and 2021. Shrimp exporters were able to maintain or increase their production levels, diversify their markets, adjust their product mix, enhance their online presence and delivery services, and implement strict health and safety measures to cope with the changing demand patterns and consumer behavior.

Shrimp export is a lucrative business that offers many benefits for producers, traders and consumers alike. With the increasing demand for shrimp products worldwide, the prospects for shrimp export are bright in 2023.

Shrimp Export: A Global Industry in Flux

Shrimp is one of the most popular seafood products in the world, with a global trade value of over $24 billion in 2022 . However, the shrimp industry is facing many challenges and opportunities in the face of changing consumer preferences, environmental issues, health concerns, and market dynamics. In this article, we will examine some of the trends and statistics that shape the global shrimp export sector.

Asia vs Latin America: Diverging Production Trends

Asia is the largest producer and exporter of shrimp, accounting for about 70% of the global supply . However, Asian shrimp production has been affected by various factors, such as disease outbreaks, environmental degradation, labor shortages, and trade disputes. According to the Food and Agriculture Organization (FAO), Asian shrimp production declined by 8% in 2020 compared to 2019 .

On the other hand, Latin America has emerged as a major player in the shrimp industry, especially Ecuador, which became the world’s top exporter of shrimp in 2021 . Ecuador has benefited from its favorable climatic conditions, low production costs, high quality standards, and strong demand from China, the United States, and Europe. Ecuador’s shrimp exports increased by 23% in 2020 and by another 15% in the first nine months of 2021 .

China vs USA: Shifting Import Markets

China and the United States are the two largest importers of shrimp in the world, together accounting for about 40% of the global demand . However, their import patterns have diverged significantly in recent years. China has increased its shrimp imports dramatically, overtaking the United States as the top importer in 2022 . China’s shrimp imports grew by 56% in 2020 and by another 35% in the first half of 2021 . China’s growing appetite for shrimp is driven by its rising middle class, urbanization, e-commerce, and diversification of consumption habits.

The United States, on the other hand, has seen its shrimp imports stagnate or decline in recent years, due to various factors such as trade tensions, COVID-19 pandemic, consumer health awareness, and competition from other protein sources. The United States’ shrimp imports dropped by 5% in 2020 and by another 3% in the first half of 2021 . The United States’ main suppliers of shrimp are India, Indonesia, Ecuador, Vietnam, and Thailand .

A Dynamic and Uncertain Future

The global shrimp export industry is undergoing rapid and profound changes, as different regions and countries face different challenges and opportunities. The future of the industry will depend on how well producers and exporters can adapt to the changing market conditions, consumer preferences, environmental issues, health concerns, and trade policies. The industry will also need to invest in innovation, sustainability, traceability, and quality assurance to maintain its competitiveness and profitability.

References:

https://doi.org/10.1016%2FS0044-8486%2898%2900186-0

http://rulings.cbp.gov/detail.asp?ru=560904&ac=pr

http://library.enaca.org/Shrimp/Publications/FAO_Macrobrachium_manual_2003.pdf

http://www.fao.org/figis/servlet/static?dom=collection&xml=global-aquaculture-production.xml

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3168472

https://www.int-res.com/articles/meps/2/m002p121.pdf

https://www.fao.org/in-action/globefish/market-reports/shrimp/en/
https://www.fao.org/in-action/globefish/publications/details-publication/en/c/1507577/

https://www.fao.org/in-action/globefish/market-reports/shrimp/en/

http://journals.tubitak.gov.tr/biology/issues/biy-98-22-2/biy-22-2-12-97048.pdf

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