Indian shrimp exports set to double to $7 bn by 2022: Crisil
Country's shrimp exports is likely to double from USD 3.8 billion to USD 7 billion by 2022 due to strong demand, high quality, improved product mix and an increase in aquaculture area in several states, a report said.
"We expect shrimp exports from India to nearly double to USD 7 billion by 2022, driven by strong demand, high quality, improved product mix and an increase in aquaculture area in Andhra Pradesh, Gujarat, Odisha and West Bengal, even as our Asian rivals battle structural issues and rising domestic consumption," the rating agency Crisil said here.
The global shrimp industry is estimated at USD 30 billion and India's market share is estimated at 13 per cent by value terms.
India became the biggest exporter of shrimps with USD 3.8 billion exports during fiscal 2016. Indian exporters have in the past few years emphasised on lower-density shrimp farms to control diseases, while maintaining quality across the value chain. The use of resilient specific pathogen free (SPF) brood-stock imported from the United States has also helped the industry greatly.
Consequently, between fiscal 2012 and 2017, India's shrimp production doubled, and helped it grab the opportunity created by lower supplies from Asia, the report said.
Since 2010, shrimp production in Asia has been severely affected by diseases, floods, labour issues and tightening environmental norms. Production in Vietnam has declined 40 per cent from peak levels because of shortage of fresh water, salinity intrusion and illegal shrimp farming.
Thailand, which was once the top exporter, is now ranked 5th after a 65 per cent plunge in production from peak levels.
During 2016, China's shrimp production also nosedived 60 per cent even as its consumption more than doubled, rendering it a marginal exporter. In addition, these countries also faced significant quality challenges.
Crisil said that the rival countries are now trying to get their house in order. Improving hatchery procedures is helping Thailand to recover slowly, but Vietnam is expected to take more time to sort out quality issues.
China is struggling with both structural issues and surging domestic demand. Consequently, India's primacy in shrimp exports is unlikely to be seriously challenged over the medium term.
Additionally, larger Indian exporters are expanding infrastructure to cater to increasing demand for value-added products from big global retail chains and restaurants. Therefore, we foresee value-added exports also rising from the current 15 per cent levels significantly.
"Strong volume growth and higher proportion of value-added products will bolster the operating profitability of several shrimp exporters. Additionally, healthy accretions and the absence of major debt-funded capital expenditure will reduce leverage and further strengthen their credit profiles," Crisil Ratings director Rahul Guha said.
"Strong volume growth and higher proportion of value-added products will bolster the operating profitability of several shrimp exporters. Additionally, healthy accretions and the absence of major debt-funded capital expenditure will reduce leverage and further strengthen their credit profiles," Crisil Ratings director Rahul Guha said.
Source:- Economictimes.indiatimes.com
