magazine for sustainable sourcing and market intelligence12 sourcing update Ecuador74 united states market update38 company profile Grupo Veraz: Argentine red shrimpzooming in on shrimp techhatch blue’s study into the gaps and opportunities#7 September 2019coldwater shrimpa global market overview Powered by©2019 Stichting Seafood Trade Intelligence Portal (STIP). ShrimpTails is an STIP (www.seafood-tip.com) publication and has four issues per year.23 September 2019disclaimerLimitation of liability: STIP is not responsible for any errors in or accuracy and availability of the infor-mation provided through ShrimpTails magazine or its Platform. The information provided through ShrimpTails magazine or its Platform is for informational purposes only and not intended to serve as the sole source of information for User to make a business, trading or investment decision. In the event a User and/or its organization or employer makes a business, trading and/or investment decision based on the information provided through ShrimpTails magazine and its Platform, this is the sole responsi-bility of the User and/or its organization or employer. STIP is not liable for damages of any kind, whether direct or indirect, arising out or related to the use of ShrimpTails magazine and its Platform, except to the extent the liability arises from the gross negligence or wilful misconduct of STIP. In no event shall the liability of STIP exceed the fees paid in the twelve months preceding the event causing damages.Editor-in-Chief Willem van der Pijl / STIP (NL)Deputy Editor-in-Chief Sophia Balod / STIP (NL)Editorial Assistant Sander Visch / STIP (NL) Editors Annette van Tits, Josanne Blokker, Jo Hamilton-Bilijam & Ursula Beer / Editors Collective Amsterdam (NL)Contributors Jasmijn Venneman / STIP (NL), Adeyemi Ademiluyi / STIP (NL), Leo Voetman / STIP (NL), Alban Caratis / Fresh Studio (VN), Andres Fajardo (EC), John van Herwijnen / Open Europe (ES), Moin Uddin Ahmed / Solidaridad (BD), Liris Maduningtyas / Jala (ID), Mazhab Uddin / Consultant (BD), Aqua-connect (IN), Ursula Beer (NL) & Annette van Tits (NL) Graphic & Illustrative design Marnix de Klerk & Nina Mathijsen / Detour (NL)Cover photography Royal GreenlandWebsite support Mathijs van de Venne / Tenpitch (NL)Support Bram Verkerke / Solidaridad (NL)Advertising and sales Jasmijn Venneman / STIP firstname.lastname@example.org t +31 6 40 81 33 61 silver membersgold membersShrimpTails and Seafood Trade Intelligence Portal are powered by Solidaridad Network. 12contents05 editorial 58 southern europe70 collaborating for sustainability the Partnership Assurance Model 30 pathogen screening fundamental to increase shrimp production06 the canadian northern prawn story08 introduction to sourcing updates34 inve aquaculture announces new techno-logical innovations52 “prawn lady”reveals how to best prepare coldwater shrimp36 company proﬁles46 how sustainable is coldwater shrimp? 24 encouraging shrimp farming best practices in indonesia56 from the sea to your platesea-based and land-based processing60 coldwater shrimp speciesa global market overview76 how the chinese came to love coldwater shrimp41 zooming in on shrimp techHatch Blue’s study into the gaps and opportunities54 introduction to market updates22 vietnam68 north-western europe74 united states28 india44 bangladesh32 indonesia12 ecuador14 species guidea cold, hard look at coldwater shrimpcolumnsourcing updatesmarket updatesin-depth tailsadvertorialmonterey bay aquariumwalton family foundation04shrimptails | editorialphoto by royal greenland 05shrimptails | editorialIn this seventh edition of ShrimpTails, we want to shake things up a bit by going against our usual coverage of warmwater shrimp. For the ﬁrst time, we are featuring the small yet rather special niche market and pro-duction of the coldwater shrimp. This edition aims to make something big of this small and specialized market by analysing data, describing trends, and, overall, just telling the compelling story of what people usu-ally call the “salad shrimp.” We are also highlighting several other import-ant coldwater species. From overall production, supply chain to major markets and sustainability, ShrimpTails will walk you through this unique market. In the last edition of ShrimpTails, we promised to start from the simple and sincere question: “Kamusta?”, meaning “How are you?”, re-ﬂecting our genuine concern for how the various sectors involved in the industry are doing. The answers to this short question, we hoped, would shape our articles and give us new perspective when writing these stories.We are also introducing a series of Company Proﬁles that, in this edition, feature companies specializing in the production of the coldwater spe-cies we have identiﬁed. We investigate not only a company’s roots but also its production capacity, main buyers, and the challenges and succes- ses it experiences in the sector. Of course, we are still dedicated to produc-ing the quality content of sourcing and market updates. On a global level, this year’s Paciﬁc white shrimp (L. vannamei) production is more or less on track with last year’s production. While India is a bit behind, Ecuador is breaking records month after month. In general, the market is in much better shape than last year and is experiencing strong demand. Existing stocks in the US and EU have largely been sold and buyers have been placing their orders for the holiday season since the end of August. Chi-nese buyers have also started placing their orders for Chinese New Year (January 2020). This means that prices should remain stable towards the end of the year, with the possibility of a hike in September/October and a small dip in November/December in accordance with purchasing for the festive months. If prices remain stable, the starting point for the ﬁrst crop of 2020 around February will be good, and we may well have a big crop coming to the market by April 2020. It has been an absolute pleasure writing this edition, and big thanks go to our sources and partners who have helped us to produce the content of this magazine. On that note, we hope that you ﬁnd this edition interest-ing and insightful. Willem van der PijlDirector STIPHon Sophia BalodDeputy Editor-in-chief, ShrimpTails editorial 06shrimptails | the canadian northern prawn storythe canadian northern prawn story Bruce chapman, executive director of the canadian as-sociation for prawn producers (capp), shares the histo-ry of canada’s coldwater shrimp production and mar-ket. indigenous peoples had Been living nearBy the coast of canada and fishing its coastal waters for millennia, But it wasn’t until around 1000 ad that the first europe-ans entered the scene. for reasons that remain a mys-tery, their settlement – in what would later Be known as newfoundland – was aBandoned after only a few years. canada was officially rediscovered in 1497 and stories of a Bountiful fishery drew europeans to this new land to harvest the vast wild fish resources that the area had to offer, eventually estaBlishing their own roots.ing Canadians with steady beneﬁt from the two species – Northern prawn and the pink shrimp (P. mon-tagui) – that have been abundant in our Arctic and Atlantic waters. This success was not assured, nor has it been easily realized. The story of Canada’s wild ﬁshery is one of dynamism and adaptability in the face of many challenges. During the ﬁrst twenty years of the ﬁshery’s existence, it went through a classic development process involving stages of exploration and taking risks such as making investments, developing the necessary skills, industry capitalization, and market penetration and expansion. The Canadian Northern prawn ﬁshery experienced both business rewards After ﬁnishing university and for a brief period serving in the Armed Forces, I too had the privilege of es-tablishing roots in Canada’s ﬁshery. This was in 1977, which was also the year Canada and other countries extended their exclusive economic zone to 200 miles from their shores, in line with provisions of the UN Convention on the Law of the Sea (UNCLOS). Previously, maritime countries only had jurisdiction to manage wild ﬁsh stocks within their territorial sea just 12 miles from the shore. While the extension enabled most countries to gain full control over all of their adjacent wild ﬁsh stocks, Canada is among the few countries whose continental shelf extends beyond 200 miles. For this reason, we share the management of those ﬁsh stocks that are “trans-bound-ary” with other countries, via the Northwest Atlantic Fish-eries Organiza-tion (NAFO). The late 1970s and early 1980s was a heady period of expansion for the ﬁshing industry. The year-round (oﬀshore) ﬁshery of wild coldwater Northern prawn (P. borealis) has since become one of the most suc-cessful ﬁsheries in Canada, provid-Canada is among the few Countries whose Continen-tal shelf extends beyond 200 miles, so we share the management of fish stoCks that are “trans-boundary” with other Countries”from eastern and northern Canada, many with advanced ﬁshing and processing skills. The sector also supports about 2,000 other shore-based jobs (excluding spin-oﬀ jobs) and beneﬁts local communities and regional economies, particularly within the provinces of Newfound-land and Labrador. The ﬁshery produces high-quality, wild Northern prawn products harvested from icy waters that compete for discerning consumers in the global marketplace. With the increase of farmed warmwater shrimp, the wild Northern prawn now constitutes only about 3% of the global shrimp supply, becom-ing something of a niche product. We continue to be “the shrimp of choice” in Scandinavia and north-ern European countries, and even enjoy “special status” among dis-criminating sushi restaurants in Ja-pan. The Northern prawn is a prod-uct of choice, particularly in China and Japan, as it has a unique ﬂavour and nutrition proﬁle bestowed by Mother Nature, a product freshness that’s the result of being size-sorted and frozen at sea literally within minutes of being harvested, and a product safety that is guaranteed by always exceeding the strict government requirements. As participants in a wild ﬁshery, our companies know they will face the vagaries of a changing ocean environment and ecosystem that will aﬀect their raw material supply and will complicate their business decisions. And because virtually all of Canada’s Northern prawn production is exported, our companies are also aware of the usual whims of the global market-place. However, I am increasingly concerned about another factor. Three years ago, a very signiﬁcant market for our Northern prawn closed when Russia imposed a ban on all food products from Canada and other countries in a so-called “food embargo”. Currently, we’re experiencing much uncertainty about future market access and trade tariﬀs. While we are blessed to have a global market for our products, we need stable market access and low or predictable tariﬀs to continue to successfully provide a high-quality protein for the world’s growing population. and failures, but by the mid-1990s, it had matured into a year-round, stable ﬁshery of the most modern and advanced standard. However, in the last twenty years we’ve witnessed signiﬁcant chan-ges in our ocean climate and eco- system, initially leading to an ex- plosive growth and subsequently a steep decline in the abundance of Northern prawn in the more southern areas. This was a problem for everyone, so everyone needed to collaborate: all levels of govern-ment, various sectors of the ﬁshing industry and indigenous groups. Enterprises in the year-round sec- tor have continued to invest in more eﬃcient harvesting systems and oﬀshore processing technol-ogies, and have developed a wider, more diverse range of products in response to global market demands. This way, combined with a cooper-ative mindset, they have been able to maintain a production capacity in balance with the ﬁshable resources. The ﬁshery is ecologically sustain-able and has secured certiﬁcation by the Marine Stewardship Council. Since becoming a year-round oper-ation, the oﬀshore shrimp ﬂeet has also been ﬁnancially sustainable, and capable of adjusting to chang-ing economic conditions at home and abroad. The Canadian North-ern prawn ﬂeet consists of some of the world’s most technologically advanced ﬁshing platforms.Licence holders in this ﬁshery include indigenous groups, “on-shore” ﬁshermen’s cooperatives, and other, mostly family-owned, companies. The ﬂeet directly employs a crew and a shore-based labour force of about 600 people 07shrimptails | the canadian northern prawn storyCanadian northern shrimp fishing areas, 201008shrimptails | introduction to sourcing updatesthis third edition of ShrimpTailS for 2019 contains sourcing updates on ecuador, vietnam, india, indone-sia and Bangladesh. they provide the most up-to-date information in the form of a review of the previous months and an outlook for the remainder of the year. they include detailed regional information for each country, as well as country-wide production and ex-port trends, company news and international trade is-sues, amongst other relevant topics. in this introduc-tion to the sourcing updates, we summarize the main developments across the sector for this quarter.looking ahead indiaBetween July and the end of Sep-tember, most Indian shrimp farm-ers stocked their ponds for a new crop, the harvests of which will peak from October until Novem-ber. Although India’s production in the ﬁrst half of 2019 was hit by various problems and consequent-ly India’s output declined, current price levels have encouraged farmers to stock for the second crop on a bigger scale. We expect that the output of this second crop will largely compensate for the year-on-year decline of the ﬁrst crop. By the end of the year, India’s shrimp production may outperform 2018’s total produc-tion, albeit to a lesser extent than previously hoped for. Just like the previous crops, average harvest sizes are expected to be small and price pressure will remain the largest on the bigger sizes.vietnamAs the weather is changing, farmers have stocked more moderately for the current crop and the output of the next crop will be lower than the output of the crops at the beginning of the introduction to sourcing updates looking BackLet’s ﬁrst look at the shrimp ex-port statistics of the main shrimp producers around the world. If we compare the currently available data with the data we reported on in the ﬁrst edition of ShrimpTails, we can see that over a period of three months Indonesia, Thailand, Vietnam and especially Ecuador have improved their year-on-year performance, while Bangladesh, China, India and Argentina have not done so. However, overall, the improved output of Ecuador has had a big inﬂuence on the world’s total shrimp output. The combined output shows a positive growth of 10% in terms of export volume and a decline of only 5% in terms of ex-port value by the group of produc-ers presented in the table.Ecuador’s strong growth con-tinues to come at a cost with the value of exports not keeping up with the volume. Keeping in mind that Ecuador produces mainly head-on shell-on (HOSO) shrimp, it’s clear that the HOSO market is under pressure and that increased production can currently only be sold at a lower price. In the headless shell-on (HLSO), peeled and value-added markets, lower supply seems to have allowed for slightly better prices compared to last year when prices slumped. This is illustrated by India’s export performance. In the previous three months, year-on-year export volumes declined more rapidly than the export value, indicating that prices are up a bit. Willem van der Pijl09shrimptails | introduction to sourcing updatesyear. With supply at a lower level, but market demand high, one would expect farm gate prices to increase over the next couple of months. However, considering that Vietnam drastically increased shrimp production over the ﬁrst 6 months of 2019 (according to data released by VASEP), while export ﬁgures did not match that growth, it might be that some packers have built up a large inventory in their cold storage. If this is the case, they might sell these products ﬁrst before purchasing new raw ma-terials. This could keep farm gate prices low. In terms of exports, it is expected that Vietnam’s perfor-mance will improve. Both the EU and the US show strong interest in Vietnamese shrimp, and Viet-namese third and fourth quarter exports are expected to thrive as a result. indonesiaAfter stocking for the second crop in June and July, partial harvests of smaller sizes started to pick up by the end of September. Larger sizes are usually harvested at the end of October. However, most farmers are likely to harvest smaller and medium sizes only to avoid diseases in later growth stag-es. Just like in other years, many Indonesian farmers plan to go for a low-density third crop before the end of the year. Therefore, farmers will stock their ponds by the end of November and will then harvest before the peak of the monsoon season in January and February.bangladeshThe shrimp export sector of Ban-gladesh is facing diﬃcult times, as poor post-larvae quality and high temperatures have decreased the production output of black tiger shrimp (P. monodon) considerably. While survival is low, the shrimp actually harvested are mainly small sizes (40 and 60 count per kg). Larger sizes, generally more suited for export, are not expected until October and quantities are anticipated to be limited. While exporters face diﬃcult times with a shortage of raw materials and weak market demand, the price farmers fetch for their products remains strong as the domestic market in Bangladesh keeps grow-ing and favours the smaller sizes.eCuadorEcuador has been showing stable growth since the beginning of this year. Based on CNA data, it is on track to reach an increase in production of 20-25% to just over 620,000 tonnes by the end of 2019. Looking ahead to the coming months, local sources mention this growth could only be limit-ed by factors such as lower pond densities to decrease production costs or lower growth rates due to the exceptionally cold summer. Looking at the orders conﬁrmed at the World Seafood Shanghai Exhibition in August, China is only increasing demand. However, vari-ous sources do see the dependence on China as threatening, and call for the diversiﬁcation of Ecuador’s export markets away from China. year-on-year export performanCe of major shrimp produCerscountryvolume (tonnes)volume (tonnes)volume (%)value ($ ’000)value ($ ’000)value (%)bangladesh2China4india4indonesia3thailand4vietnam3argentina1eCuador411,855103,059361,13691,43274,653n/a42,527262,85120182019yeay-on-year growth1 january-april 20192 january-may 20193 january-june 20194 january-july 20199.76-18.39-3.46-0.28-3.52n/a-5.1638.495.89-19.99-7.99-9.80-6.12-11.96-3.8612.16142,089929,6022,491,554756,760738,2081,440,204285,4162,094,77313,01284,102348,65091,17472,028n/a40,333364,011134,1801,161,8922,707,948838,950786,3551,635,927296,8841,867,697sources: trademap, gacc, vasep, cna, bpsNext >
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