Worldwide Shrimp Supply Remains Tight

With Vietnam's shrimp farming industry currently being undermined by a potentially far reaching disease outbreak, and Thailand having already been hit this year by flooding and temperature problems, attention has been switching to India's shrimp production.

India is rapidly switching over from black tiger farming to vannamei and is achieving strong export volumes as a result. To accommodate this large supply, processing plants have been running at 150 percent to 200 percent capacity.

Last year, India harvested 150,000 metric tons of vannamei and black tiger shrimp, up from 105,000 metric tons in 2009. The Kolkata region remains the main production area for black tiger farming, while the southern aquaculture region is shifting more and more to vannamei.

Demand for Indian shrimp has been particularly strong from the U.S. Market.

In October Vietnam's disease outbreak had hit an area of 53,000 hectares in seven provinces of the Mekong Delta, wiping out 98 percent of 20–30-day-old shrimp – mainly black tigers. As a result of the raw material shortage, processing plants in the region had been operating at less than 60 percent capacity.

The news of serious crop failure in Vietnam is putting further pressure on the market, and observers expect the global supply to remain very tight and prices to stay high for at least the next 18 months.

In terms of end-consumers, the important Japanese market has remained steady but with lower imports this year. Household consumption during the first quarter was nearly 11 percent lower than Q1 2010 largely a result of the Tohoku earthquake and tsunami in March.

Inventories are low for all shrimp, which kept market prices steady during the first half of the year.