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March 23, 2015

The World

Shrimp Prices

 

Ken Salzinger, editor of Ken’s Catch, a free, email-based newsletter on the seafood business, comments on shrimp prices in the most recent edition of his newsletter:

 

At Seafood Expo North America (March 15-17, 2015, formerly known as the International Boston Seafood Show), much of the buzz on the conference floor concerned shrimp prices.  Will they continue to move downward?  When will the bottom be reached?  When will demand start to pick up?  Importers are concerned because as soon as a shipment of shrimp arrives, it has already lost value from when the order was first placed.  Wholesalers and distributors are continuing to buy on an as needed basis for fear of sitting on high-priced inventories.  The biggest disagreements on this issue concern exporting countries.  A Thai exporter indicated that the United States is really the only game in town as weak currencies globally are preventing large shrimp importers like the European Union and Japan from participating in a large way.  China’s economy is slowing down and may not be the panacea that everyone has come to expect.  This leaves the USA as the only game in town.  In light of sluggish demand and a glut of inventory, can the USA continue on its buying spree?  Moreover, with countries like Thailand, Malaysia China recovering from EMS and shrimp farming powerhouses like Indonesia, India and Ecuador increasing production, it is apparent that production this year may outstrip demand, forcing exporting countries to lower prices to move their crops.  Contrary to this opinion, however, Ecuador is taking a different approach, citing huge orders for whole animals from China and shell-on tails from Vietnam.  It believes that supply will be down on a global basis and that the USA is not the dominant force in world markets.  I don’t agree with Ecuador’s point of view because China will probably trade down in sizes to make product more affordable for their population.  Moreover, since Ecuador’s currency is pegged to the dollar, it is costing Europe more in euros to import product.  I sincerely believe, that given all the facts, pricing will continue to trend down at least for the next two quarters and possibly until the end of the year.

 

Source: Ken’s Catch (a free, email-based newsletter on the seafood business).  Editor Ken Salzinger (phone 609-664-2253, cell 732-261-3358, email kensalz@comcast.net).  March 22, 2015.

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