< Previousshrimptails | machine vs manual peelingbrand presence and recognition in the Chinese market, are paying oﬀ. If Ecuador wants to diversify fur-ther away from China’s unstable wholesale market, it must look at other markets such as traditional HOSO markets in southern Europe or Asia. While the HOSO market in southern Europe, especially Spain and France, is largely saturated and may not oﬀer a lot of opportunity for growth, other markets in Asia, such as South Korea, are on the priority list of Ecuadorian export-ers’ expansion plans. Unfortunately for Ecuador, most consumers in other large shrimp markets such as north-western Europe and the US are less accustomed to eating HOSO shrimp; they prefer to eat their shrimp already peeled. ProcEssing caPacity, thE ssp and more flexibiliTyTo access markets for peeled products, Ecuadorian exporters need to make investments in their factories. The processors need more space and staﬀ as well as diﬀerent processing and freezing lines. The most important beneﬁt for Ecuador’s exporters to open up these markets is that they oﬀer the opportunity to sell the same product – which is now sold to China at a low price as b-quality – to the US or Europe as a normal or even premium-quality product, but then peeled. The reason is that the b-quality product exported to China is based on the unfavour-able red colour of shrimp tails or heads and the hard-ness of the shrimp shell. As peeled products have the tails, heads and shells removed, these factors are not as important. The challenge for Ecuador in these peeled markets lies, however, in how to compete on price with exporters from India and Vietnam who can oﬀer their peeled products at a lower price.This is where Ecuador’s Sustainable Shrimp Partnership (SSP) comes in. The SSP aims to support the Ec- uadorian industry in distinguishing its shrimp from its Asian counter- parts. All shrimp sold under the SSP ﬂag will be ASC certiﬁed (which is merely a market access require-ment in most of the peeled mar-kets) and on top of that comply with several other requirements such as zero antibiotics and full traceability. Together with Ecua-dor’s story of sustainably produced shrimp through less intensive and more professional production systems, Ecuador’s exporters hope to position their products at a pre-mium price in the peeled markets in the EU and US. Whether this is something that EU and US retailers are willing to pay for remains to be proven, but the Ecuadorians are convinced and persistent in their endeavour.Flexibility is another quality required for Ecuador’s exporters when selling in the peeled markets, especially in Europe. Contrary to buyers from China who can place orders for 100 containers a month at a time, buyers who cater to the peeled markets in the EU order much smaller volumes with many more product speciﬁcations. To be able to cater to these buyers it is crucial for Ecuadorian export-ers to be ﬂexible and responsive, even when the service cost per container or per contract is higher. Several ShrimpTails sources in Europe argue that many of the big-ger Ecuadorian exporters are not very responsive to their enquiries. However, the times may be chang-ing. As one sales manager of an Ecuadorian exporter mentioned, her company, one of Ecuador’s bigger exporters, is ready to take smaller orders. An order of one container per month for 10 years is more valuable than a single order of 100 containers at a time. For a healthy business climate, stability of demand and stability of prices are a must.leading exporTers guide thE wayWith its additional volume of shrimp coming to the market, Ecuador must invest in diversi-fying its markets and positioning its shrimp as a premium product. In order to gain access to markets that are receptive to Ecuador’s brand story, further along the road, Ecuadorian exporters will need to make certain investments in their factories to be able to process shrimp with the right product speciﬁcations. With large companies like Omarsa and Songa gearing up their investments and marketing activities, ShrimpTails will follow the development of Ecuador’s trade ﬂows with a keen interest over the years to come. if ecuador wants to diversify further away from china’s unstable wholesale market, it must look at other markets”20shrimptails | ecuador’s need and ambition to diversifywww.seafood-tip.comUp to two individual user accountsFull access to sourcing intelligence reportsFull access to supplier and/or buyer databaseFull access to associate networkFull access to tailormade services25% discount on admission fee to STIP eventsFull access to scoping reports (€100,-)1 hard copy of the ShrimpTails magazine per edition (€200,-)10% discount on advertisement in ShrimpTailsFree consultancySeat in STIP steering committee* See website for pricesUp to ﬁve individual user accountsFull access to sourcing intelligence reportsFull access to supplier and/or buyer databaseFull access to associate networkFull access to tailormade services50% discount on admission fee to STIP events4 hours per year free consultancyMinor visibility on STIP websiteFull access to scoping reports (€100,-)2 hard copies of the ShrimpTails magazine per edition (€300,-)25% discount on advertisement in ShrimpTailsSeat in STIP steering committeeUnlimited user accountsFull access to sourcing intelligence reportsFull access to supplier and/or buyer databaseFull access to associate networkFull access to tailormade servicesFree access to STIP events8 hours per year free consultancyProminent visibility on STIP websiteSeat in STIP steering committeeFull access to scoping reports (€100,-)5 hard copies of the ShrimpTails magazine per edition (€425,-)50% discount on advertisement in ShrimpTailsBRONZE MEMBER*SILVER MEMBER*GOLD MEMBER*MOST POPULARjoin our network become a memberseafood-tip.com sourcing updatevietnamwith markEt dEmand for thE christmas sEason Picking uP, thE PEriod from august to noVEmbEr is normally a busy PEriod for shrimP farmErs and ProcEssors in ViEt-nam. iT was, Therefore, expecTed ThaT demand would fi-nally incrEasE aftEr summEr and would bring about thE much-awaiTed price recovery. however, as ShrimpTailS forEcastEd in its third Edition, this did not rEally haP-PEn. according to thE ViEtnam association of sEafood exporTers and producers (VasEP), The value of shrimp exporTs dropped by 4.1% (To $2.6bn) in The firsT nine months of 2018 comParEd to thE samE PEriod in 2017. this decline was mainly accounTed for by exporTs of marine shrimp (-28.2%) and To a lesser exTenT black Tiger shrimp (p. monodon) (-28%). in conTrasT, The ToTal exporT value of Pacific whitE shrimP (l. vannamei) incrEasEd slight-ly wiTh 1.3%, buT wiTh a 10% increase in exporT volume, The average exporT price per kg of pacific whiTe shrimp dEclinEd significantly.mEkong dEltaca maumEkong dEltaAccording to a large processor in the Soc Trang province, orders increased slightly from the end of August, as the company could load about 30 containers per month instead of 20 a few months earlier. This caused prices to rise a little early September, but demand and prices have not improved much since then. In consequence, many farmers are still reluctant to produce at full capacity. Furthermore, adverse weather and heavy rain have led to production failures in Bac Lieu, Soc Trang and Long An (respectively 33%, 16% and 3% of the production area). There was also a shortage of post-larvae from important hatchery producers, which further limited stocking.Compared to Paciﬁc white shrimp farmers, black tiger shrimp farmers are faring worse towards the end of the year, despite production being out of season and raw material supply usually being low. During the crash of Paciﬁc white shrimp prices in the second quarter, prices of black tiger shrimp were stable, which led some Paciﬁc white shrimp farmers to switch to production of black tiger shrimp. Since then, however, compared to last year, prices have decreased by a signiﬁcant 30,000-40,000 Vietnamese dong ($1.3-$1.7)/kg in September.looking back looking back looking ahead 22shrimptails | vietnam sourcing updateca mauca maulooking ahead Fresh StudioFarmers in Ca Mau usually stock the next crop of black tiger shrimp in December. Typically, some farmers already stock partially in October, but it is unclear how many post-larvae have been stocked, as the market price was particularly low. The eﬀect of this crop on the supply can be felt as early as February, with a peak between March and May, when the December crop is harvested. ShrimpTails hopes to see a fast price recovery by the end of December, before the Chinese New Year. The last harvests of 2018 were completed in the ﬁrst weeks of December. Given the current low prices, we expect farmers to stock the ﬁrst crop of 2019 in late January before Vietnamese New Year, and the peak harvest to occur in April as usual. In 2019, however, the peak harvest could last until May as some farmers might wait longer before stocking their ponds. This would indeed be advisable as other countries, such as India, will also harvest mainly in April, possibly causing another price crash. 23shrimptails | vietnam sourcing updatecEntral ViEtnam and north ViEtnamcEntral ViEtnam Many provinces in Central Vietnam harvested the second crop between September and Octo-ber, just after prices spiked by 10%. Many farm-ers did not stock a third crop because weather in the central regions usually becomes severe towards the end of the year, and only a small por-tion of producers in Central Vietnam have the facilities to produce a third crop.looking back Most of the harvests of 2018 have already been wrapped up since October-November, and nearly all ﬁrst crops of 2019 will not start until March, as January and February are the coldest months, with unfavourable market conditions. Producers in Central Vietnam are China-minded, which, in January, just before the Chinese New Year, should lead to a steeper price increase than in the Mekong Delta. However, Central Vietnam may suﬀer from a decrease in imports from the Chinese market. Revenue in the period from January to October from the Chinese market was $356.7m, 28.7% less than in 2017, and month-by-month revenue was signiﬁcantly below last year’s ﬁgures. looking aheadWhile we expected that Vietnam would reduce its shrimp output signiﬁcantly during the second half of 2019, VASEP reported production volumes have slowed down less than expected, with production volumes af-ter the third quarter of 2018 still above last year’s. While the year-on-year growth rate after the second quarter was still 11%, after the third quarter VASEP only report-ed a remaining 8% growth rate. Keeping in mind that farmers have not stocked at full scale, it is likely that the year-on-year growth rate for the last quarter of the year will continue this negative trend and that the annual growth will have come to a halt by the end of the year. Developments of farm gate prices conﬁrm this trend. Despite small spikes of 10% and 20% in farm gate pric-es – especially for smaller sizes of both Paciﬁc white shrimp and black tiger shrimp – recorded in our portal early September, prices remained between $0.7 and $1.5 below what they were in the same period last year. Therefore, many farmers continued to delay stocking or decided to not embark on a third crop at all. This trend was certainly further motivated by unfavourable weather conditions. In July, heavy rains of 500 mm (a 70% increase of the four-year average) marked a looking backlooking aheadhistorical start of the rainy season and ﬂooded inland provinces such as An Giang, Dong Thap and Long An. The extremely wet summer was then followed by a drought in September and October, which was 40% more intense than the average in the previous four years. Looking more closely at Vietnam’s exports, it is worth noting that, while the export of processed Paciﬁc white shrimp increased by almost 10% from January until October, the export value of raw frozen shrimp declined by 5%. This conﬁrms Vietnam’s position as a source for more value-added products, outcompet-ing India, Ecuador and maybe even China, amongst others. It might also indicate that prices for raw frozen shrimp are under more pressure than prices for value- added products.Vietnam’s exporters will need until the end January to ship harvests of the last crop of 2018, which farm-ers will complete by the end of December. Although farmers could already stock as early as January 2019, most stocking is expected to take place from early February onwards. Peak harvests of the ﬁrst crop of 2019 will take place from April onwards. ShrimpTails does not expect a signiﬁcant recovery of export prices for Vietnam before February 2019, when exporters and importers have cleared their low-priced invento-ries. Farm gate prices may also start increasing slightly from January onwards to encourage farmers to stock for the next cycle. Although we are hopeful that prices will recover during the ﬁrst quarter of 2019 and will not crash once the ﬁrst crop has been harvested, there is a risk of prices dropping again, depending on whether Vietnam’s competitors, especially India and Ecuador, will have successful ﬁrst crops. Signiﬁcant invest-ments have been made by Vietnamese farmers and producers, however, to remain competitive in these conditions, by diversifying and professionalizing production (e.g. by adopting super-intensive farming which can bring about a 20% higher margin compared to intensive farming). Moreover, with the upcoming EU-Vietnam Free Trade Agreement, and with reduced duties in the US market, Vietnam might be able to gain market share at the cost of its competitors. 24shrimptails | vietnam sourcing updateThe EU-Vietnam Free Trade Agreement and the Investment Protection Agreement (IPA) between Vietnam and the EU have recently been adopted by the European Commission and will be submitted to the European Council for oﬃcial signature end of 2018, before approval in the European Parliament early 2019. On 10 September, the US Department of Commerce (DOC) announced a reduction of anti-dumping duties of shrimp imports which were imposed earlier in the year. This news relieved Vietnamese processors, particularly after a 25.39% duty was announced last March, following the 12th Period of Review (POR12). Vietnamese processors protested against this duty, which was subsequently reviewed by US authorities. Mr Ho Quoc Luc of Sao Ta Foods, who was involved in the provision of data requested by the DOC, claims the original calculations compared Vietnamese Paciﬁc white shrimp production costs with those of Bangladeshi black tiger shrimp. In its calculation, as a reference, the DOC included Bangladeshi black tiger shrimp instead of a more logical reference such as Paciﬁc white shrimp from e.g. India or Indonesia. Although the tariﬀ reduction is not signiﬁcant, Mr Luc hopes the next Period of Review (POR13) will reduce the tax even further, after accounting for changes in production costs and ﬁnal value.Last August, state-owned energy provider EVNSPC an-nounced the results of a survey among shrimp farmers in delta provinces. According to their ﬁgures, 65-75% of shrimp farmers in Ca Mau, Bac Lieu and Soc Trang, three of the country’s biggest farming regions, are not connected to a three-phase electricity grid. Upgrading to a three-phase grid will allow for more eﬃcient and safe use of the electrical devices required for intensive shrimp farming. Based on these ﬁgures, the report goes on to question the feasibility of targets in the 2025-2030 aquaculture master plan set by the govern-ment. EVNSPC plans to continue development of the region’s power grids. The ﬁrst edition of ShrimpTails already reported an earlier investment of $66m from EVNSPC as well as larger investments from the World Bank Subsidized Distribution Eﬃciency Project. january february march april may june july august september october november decembermekong deltaca mauharvestingcalender black tiger shrimp january february march april may june july august september october november decembermekong deltacentral vietnam paciﬁ c white shrimpinternational tradeeu-vietnam, one step closer to the free trade agreementdoc announces reduction in anti-dumping dutiesconnectivity to the electricity gridmonterey bay aquarium announces partnerships with shrimp giantscrackdown on vietnam- china border trade25shrimptails | short newsDuring the 2018 Our Ocean conference, which took place on Bali, Indonesia, Monterey Bay Aquarium had two things to celebrate. Minh Phu, Vietnam’s leading shrimp exporter, announced that it would work with Monterey Bay Aquarium, the organiza-tion behind Seafood Watch, and auditing company SGS to help 20,000 farmers in Minh Phu’s sourcing network reach a higher level of sustainability so that they comply with the Seafood Watch requirements for obtaining a yellow or green status. In addition, Monterey Bay Aquarium, Thai Union Group PCL and Chicken of the Sea® recently announced their launch of SeaChange® IGNITE. The companies have togeth-er committed to invest $73m in the initiative until 2025. The collaboration will initially focus on veriﬁed sustainability improvements for shrimp and blue swimming crab toward Monterey Bay Aquarium’s Seafood Watch Good Alternative and Best Choice ratings. In turn, this will provide new opportunities to supply sustainable products to the US market.Early November, Undercurrent News reported that the Chinese government spooked the global shrimp industry with 25 arrests made in Shanghai, Zhanjiang, Nanning, Tianjin, Qingdao and Shenyang on 31 Oc-tober in relation to the illegitimate border trade with Vietnam. Another crackdown was reported by Under-current News on 30 November: 66 people connected to 16 smuggling rings have been arrested. ShrimpTails sources say that exporters are becoming more careful when exporting shrimp to China through Vietnam. However, others argue that such arrests are made every year, claiming that border trade is aﬀected only temporarily. Undercurrent News further reports that there are rumours that about 1,500 containers of seafood are stuck at the Vietnam-China border, with Chinese importers refusing to accept the containers. ShrimpTails expects that the risks that come with the border trade may ﬁnally be aﬀecting exporters enough to increase their eﬀorts to export to China directly. the monitoring and certiﬁcation system in place can suﬃciently provide reliable guarantees that EU requirements are met, with the exception of some minor short-comings in relation to critical control points and monitoring of raw material supply chains. Most importantly, the team conclud-ed that all requirements of the Residue Monitoring Plan were in place. As a result, on 24 October 2018, the EU parliament decided to ﬁnally approve exports of aqua-culture products to the EU. This is a breakthrough for Myanmar and opens doors to the European shrimp market. Read more about how Myanmar achieved this in How Myanmar is Striving to Ex-port to the EU in the ﬁrst edition of ShrimpTails. bangladEshShrimp exporters in Bangladesh heavily depend on the EU market. Luckily for them, there are cur-rently no extraordinary EU mea-sures that apply to shrimp import-ed from Bangladesh. Therefore, the November EU audit of Bangla-desh is of utmost importance for its government and for shrimp ex-porters. The EU audit team visited Bangladesh from 5 to 17 November Do you want to stay up to date about the EU’s audit schedule? Check https://ec.europa.eu/food/audits_analysis/audit_pro-grammes_en regularly. The EU normally announces audits a year ahead. Besides the audits discussed in this article, in the last months of 2018, the EU also audited the Res-idue Monitoring Plans of Ecuador and Indonesia. We will inform you as soon as reports are published.myanmar The EU audit team visited Myan-mar in February and March 2018; not long after the December 2016 audit. The audit report stated that since the previous audit, procedures have been introduced and measures have been taken to improve the enforcement capac-ity of the competent authority. Overall, the audit team concluded that the announced corrective follow-up measures were imple-mented satisfactorily. As a result, the eu audit agenda asian countries under inspection26shrimptails | the eu audit agendathE Eu rEgularly audits thE systEms, rEgulations and ProcEdurEs of third countriEs (countriEs outsidE The eu) which guaranTee ThaT seafood exporTed from thEsE countriEs into thE Eu is safE for its consumErs. thErE arE two tyPEs of Eu audits. thE first focusEs on thE oVErall managEmEnt of fishEriEs and aquaculturE producTs desTined for exporTs To The eu. The second focusEs on thE monitoring of rEsiduEs in aquaculturE Products. during thE audits, a tEam of Eu insPEctors visiTs offices of The eu-appoinTed compeTenT auThoriTy in thE rElEVant country, Primary Production locations (fishing boaTs or aquaculTure farms), collecTion and storagE sitEs along thE suPPly chain, ProcEssing Es-tablishmEnts and laboratoriEs. thE outcomEs of thEsE audits dEtErminE undEr what conditions a country can exporT iTs seafood To The eu. in This updaTe, we discuss somE of thE rElEVant Eu audits that haVE takEn PlacE in 2018 as well as Those expecTed To Take place before The End of thE yEar.27shrimptails | the eu audit agenda2018 and travelled from the capital city Dhaka via the south-eastern port city of Chittagong, to the south-western shrimp farming hub around Khulna, and then fur-ther to central Bangladesh to visit its freshwater ﬁsh farming capital Mymensingh. The auditors’ visits to Khulna and Chittagong focused on Bangladesh’s shrimp industry, while the visit to Mymensingh centred around the pangasius (P. pangasius) sector. Mymensingh is a surprising des-tination. As opposed to Khulna and Chittagong, it is not a shrimp farming area, but it is the Bangla-deshi hub for pangasius produc-tion. In recent years, supported by international donors, several processing establishments have invested in the set-up of ﬁllet-ing facilities and have started to produce pangasius ﬁllets. The fact that the EU has audited this area may indicate that the processors and farmers in Mymensingh are serious about expanding their pangasius exports to the EU. To keep yourself informed about this topic, contact us. We will keep you posted on the outcomes of the au-dit once the EU publishes its audit report. indiaIndia is in a diﬀerent situation than Myanmar and Bangladesh. Since a couple of years, 50% of shrimp imports from India into the EU are examined on arrival in EU ports. In addition, if a contain-er is rejected due to detected use of antibiotics, the involved processor in India will lose its EU approval number. Due to these stringent measures, EU-India shrimp trade has slowed down in 2018. Import-ers and exporters were hoping that once the EU audits for ﬁshery products and for the Residue Mon-itoring Plan in India had been held, the EU would change its policy towards India. During a meeting in Brussels in April 2018, an EU representative told stakeholders that decisions would be taken only after both audit reports were published.While the results of the 2017 audit were already published in April, the outcome of the April audit – which focused on India’s Residue Monitoring Plan – was only pub-lished on 8 November 2018. The report concludes that the Residue Monitoring Plan for aquaculture, already approved by the EU, has been implemented as planned and is supported by extensive addi-tional pre-harvest and pre-export testing programmes. Notwith-standing these promising devel-opments, the eﬀectiveness of the plan is weakened by the fact that many medicines (i.e. antibiotics) available to farmers in the local market are not included in the list of substances for which products destined for exports are being tested. The key recommendation to Indian authorities is therefore that India should expand the list of substances to be tested to include all products available to farmers in India. The Indian authoritieshave agreed to expand the list by 1 December. Based on oﬃcial meeting reports of the EU authorities in Brussels, the Seafood Importers and Pro-cessors Alliance (SIPA) informed ShrimpTails that the EU might be considering expanding the number of residues that are being tested for at EU borders. In addition to the already ongoing testing for antibiotics such as chlorampheni-col, tetracycline, oxytetracycline, chlortetracycline and metabo-lites of nitrofurans, testing for macrolides, aminoglycosides and beta-lactams including cephalo-sporins, lincosamides, diaminopy-rimidines and doxycycline could be considered. If the EU indeed takes this decision, it will mean an additional ﬁnancial burden for im-porters. Unfortunately, there is no mention in the report or summary of the EU authorities meeting in Brussels about whether the testing ratio in European ports will be adjusted and whether the policy of delisting companies after rejec-tion will change anytime soon.bEing oPEn to discussionsWhile participating in the EU- India shrimp dialogues earlier in 2018, an EU representative explained to the audience that the most important goal for the EU is for third-country authorities to be open to discussions. The EU expects that, if shortcomings are identiﬁed, the competent authorities will communicate this to the EU, while also ensuring that they will make every eﬀort to continuously improve the situation. Unless food safety is at signiﬁcant risk, if this willingness is shown, it’s unlikely that the EU will implement extraordinary measures. Therefore, let’s hope that the competent authorities in India, Bangladesh and Myanmar will continue to engage with the EU and as a result allow EU-Asia shrimp trade to ﬂourish. sourcing updateindia28 shrimptails | india sourcing updateWillem van der Pijlbased on The firsT Three quarTers of 2018, shrimp exporT volumes from india sTill show a year-on-year increase of 23%, already ToTalling 460,000 Tonnes end of sepTem-ber. however, afTer a sTunning 72% year-on-year in-crease in june, This increase more or less halved To 38% in july, and dropped furTher To a year-on-year growTh of 1% in augusT and even a 22% year-on-year decline in VolumE in sEPtEmbEr. aftEr haVing sEEn an uPward farm gatE PricE trEnd until thE End of octobEr, from thE first wEEk of noVEmbEr, whEn harVEsts of thE wintEr croP startEd, farm gatE PricEs bEgan dEcrEasing. as wE warnEd about in thE third Edition of ShrimpTailS, it sEEms that noVEmbEr harVEsts haVE indEEd arriVEd too latE to catEr to thE EuroPEan and us christmas sEason, forcing exporTers To sell aT lower prices. we expecT that PricEs continuE to dEcrEasE until thE End of 2018 whEn thE harVEst of thE wintEr croP will bE wraPPEd uP, Picking uP at lEast modEratEly through thE first quartEr of 2019 whEn not much shrimP will bE harVEst-Ed. what will thEn haPPEn dEPEnds on thE magnitudE of india’s first croP of 2019 coming to thE markEt from aPril onwards.looking back andhra PradEshCompared to 2017’s second crop, only 60-70% of the farmers in Andhra Pradesh have stocked their ponds for the winter crop. Disease out-breaks have been witnessed in the Nellore, Gun-tur and Krishna districts, but other than slow growth, the outbreaks have not caused mass mortalities. For the short winter crop, farmers decided to aim for a higher stocking density than normal and started harvesting their ponds early November onwards at sizes of 80-120 pcs/m2. Prices for small-sized shrimp dropped quickly from the ﬁrst week of November, demonstrating once more that the market is not ready for large volumes of small sizes. looking back gujaratFarmers in Gujarat lost much of the summer crop due to low prices, slow growth, poor survival and disease outbreaks. Several farmers associations therefore decided to take a crop holiday and to clean ponds in order to stop the unrelenting dis-ease outbreaks. The second crop from Gujarat is therefore expected to have been at least 40-50% smaller than last year’s second crop harvest.wEst bEngallooking backFarm gate prices in West Bengal crashed even deeper than in other Indian states. As a result – except for some pockets of farmers who stocked their ponds in July and August – also in West Bengal stocking was delayed until the ﬁrst week of September. Harvests of the second crop started early November and, after prices had crashed hard during summer without recovery, the ﬁrst weeks of November showed prices jumping to similar levels as in other states. Harvests in West Bengal usually end slightly earlier than in the more southern states, as temperatures are dropping. The last harvests at 30-40 count per kg took place in the ﬁrst half of December. ShrimpTails sources report that the total harvest volume of the second crop has been around 38,000-40,000 tonnes, a decrease of at least 10% compared to the second crop of 2017. 29shrimptails | india sourcing updatelooking aheadwEst bEngalJust like Orissa, West Bengal has a slightly colder climate than Andhra Pradesh. As a result, farmers will begin stocking slightly later than in Andhra Pradesh, most likely only at the end of February. Harvests will then start only by the end of April or early May.looking ahead gujaratWith many farmers in Gujarat having gone for a crop holiday in the second half of 2018, and having had considerable time to prepare for the new season, it is expected that they will stock at full scale for the ﬁrst crop of 2019. It remains to be seen, however, whether the crop holiday has helped solve resurfacing disease issues.While exports in August and September slowed down, average export prices started to recover and increased from a low of $6.92/kg in June, to $7.19/kg in July, $7.61/kg in August, and $7.92/kg in September. These prices are still considerably lower than in 2017, when prices were $8.53/kg in July, $9.13/kg in August and $9.16/kg in September. Although statistics are not yet published, ShrimpTails expects that October has been another month in which export volumes show a negative year-on-year growth and export prices will have strength-ened. We expect November statistics to show that, though the growth rate may still be negative, it will be-gin an upward trend again, as the winter crop has been harvested from November onwards. As reported in the north-western Europe and US updates, India has been losing its market share in north-western Europe but has been expanding its market position in the US. Turning our attention to farm gate prices, it is interest-ing to review what has been happening since Septem-ber. While prices increased rapidly in August, in Sep-tember prices stabilized or showed a moderate increase until the beginning of November. In Andhra Pradesh, prices started to decrease through November and looking backearly December. This downward trend has been the strongest for smaller sizes. While a 30 count in Andhra Pradesh sold at a high of 480 rupees per kg end of Octo-ber, early December, the price increased to 470 rupees per kg. Similarly, a 60 count sold at 330 rupees per kg end of October, but only at 290 rupees per kg early De-cember. Reportedly, some packers in Andhra Pradesh have not been able to source suﬃcient raw materials locally and therefore tried to purchase raw materials in Orissa and West Bengal, driving up prices in those areas. With all harvests wrapped up before the end of the year, we can conclude that the second half of 2018 has been a much lesser six months than the second half of 2017. Although some insiders in India expect that the country’s overall shrimp output for 2018 will be dras-tically reduced compared to 2017, the ﬁgures do not support this expectation. With the export volume of the ﬁrst nine months of 2018 having reached 460,000 tonnes already, the winter crop only needs an addition-al 90,000 tonnes. ShrimpTails expects that it will be a close call and that 2018’s export volume will end up at a similar, or slightly lower number than 2017. Looking into 2019, the ﬁrst three months will be slow in terms of output. Across India, January will be a dry month with farmers cleaning and preparing their ponds for the new summer crop. In most areas, farmers will start stocking their ponds by mid-Febru- ary when better weather conditions will have arrived. Considering the historical success rate, keeping in mind the second half of 2018 and with the likeliness that prices will increase during January and February when little product will be available in the market, ShrimpTails expects farmers to be eager to embark on this new crop and to stock at levels equal to or higher than 2017. To have an early understanding of what will happen in April when the ﬁrst crop harvests start, it is crucial to closely monitor the sales of post-larvae and feed from India’s hatcheries and feed mills from February onwards. These factors will be indicators of the size of India’s 2019 summer crop. New farming areas have also been developed in Haryana and Punjab and although volumes will still be small, new origins of shrimp within India will start bringing their product to the market in 2019. looking aheadandhra PradEshEspecially in Andhra Pradesh, shrimp prices are expected to increase in January to encourage farmers to start stocking in February. With quite a few new farming areas having been developed in 2018, output from Andhra Pradesh will likely increase at least slightly during the ﬁrst crop of 2019. Farmers are expected to restock their ponds from mid-February onwards, and har-vests will start from mid- to end April onwards. looking aheadNext >
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