Frozen black tiger shrimp for export. (Photo: Bangladeshseafood)
Foreign vannamei shrimp depresses frozen seafood exports
Monday, October 05, 2015, 00:20 (GMT + 9)
Frozen seafood exporters from Bangladesh have been forced to decline their prices to improve sales given the large cheaper vannamei shrimp supply in the international market and the fall of the euro and the ruble against the American dollar.
From the sector it has been pointed out that this large supply of low-priced vannamei led to the decline in the cost of Bangladeshi frozen fish by nearly 40 per cent, The Financial Express reported.
Seafood importers from key destinations like European countries and Russia mostly prefer to choose low-priced vannamei shrimp to the Bangladeshi black tiger shrimp as their currency has fallen against the dollar. The United States also imports the same variety of shrimp following its low cost.
According to the Bangladesh Frozen Food Exporters Association (BFFEA), the average cost of frozen shrimp to the EU countries declined from USD 12.88 to USD 8.96 per kg in the fiscal years 2013-14 and 2014-15.
Besides, BFFEA stressed frozen shrimp exports to the EU, the US and Russian markets also decreased significantly in volume during last year.
In addition, the Export Promotion Bureau (EPB) data revealed a drop in profits from frozen shrimp exports, which declined by around 41 per cent in the July-August period in the fiscal year 2015-16 compared to that of the corresponding period of the fiscal year 2014-15,
The sector earned USD 68.69 million during the first two months of this fiscal year, compared to USD 115.73 million received during the same period of last year.
For his part, ARK Sea Foods Ltd managing director Amin Ullah pointed out: "We are now making push sales to foreign buyers as there is no sufficient demand of our products in the market."
“Following available supply of vannamei shrimp, the demand for Bangladeshi black tiger decreased notably in the world market,” he added.
The executive also stressed the difficulties to widen the extent of customers, which is not settled even by offering lower prices.
Referring to the challenges faced by exporters, BFFEA representatives explained the exporters already lost their working capital of BDT 4.63 billion (USD 58.4 million) in the last fiscal year.
Lockpur Group of Industries Ltd deputy managing director Khan Habibur Rahman highlighted the fact that the world frozen shrimp market is now “buyer's dominating ones for Bangladesh,” which makes it difficult for them to bargain with the customers for better prices.
Given all these challenges, exporters have urged the government to take some measures such as block accounts and subsidy ceiling increases.
“With production of low-priced vannamei, India,Thailand and Vietnam are now leading the world shrimp market through export of vannamei shrimp,” exporters claimed.
“It is very difficult to achieve the target this fiscal year. The target of earnings from frozen fish sector was fixed by the EPB at USD 578 million in this fiscal year of which only 40 to 45 per cent can be achieved during 12 months of current fiscal year,” exporters explained.
Bangladesh earned some USD 568 million through export of frozen fish in the fiscal year 2014-15.