Shrimp exports sink as western consumers tighten spending

The demand for Bangladesh's black tiger shrimp export is fast losing ground in western markets, prompting the government to approve the commercial production of vannamei, a cheaper top-selling shrimp variety.

Bangladesh's shrimp export fell by 26.27% to $300 million in FY23, according to data from the Bangladesh Export Promotion Bureau. The export was 40% lower than the target of $500 million. 

To prevent further erosion in the exports, which mostly comprise black tigers, the Department of Fisheries recently gave preliminary permission for vannamei production in the country.

To quickly get commercial production up and running, fisheries company Desh Bangla has been granted permission to experimentally produce vannamei juveniles.  

Exporters said Bangladesh's shrimp shipments are badly hurt by the global economic recession induced by the Ukraine war, forcing western consumers to lean more towards vannamei shrimps which cost $2-$3 less than black tigers in retail markets in the US and Europe.

According to the Bangladesh Frozen Food Exporters Association (BFFEA), vannamei's market share has increased from 77% to 82%-83% of the $32 billion global shrimp market within a year. The rest of the market is occupied by black tigers, lobsters and some marine fish.

Almost 85% of Bangladeshi shrimp is exported to Europe, 7%-8% to the US and the rest to Japan and the Middle East.

Exporters said the biggest slowdown in the export of shrimps was in November, December and January when orders had come down to rock bottom. 

During that period, European consumers saw their electricity bills triple during the winter, as a result, they cut down on restaurant visits.

Push to stay afloat

There is no alternative to vannamei farming to increase shrimp exports, stakeholders said. It is no longer possible to compete in the market with black tigers. 

Many consumers want to buy vannamei and black tiger shrimp together. When there is only one kind in this country and not the other, then the order does not come to Bangladesh, they observed. 

In this situation, after the trial production for more than two years, the Department of Fisheries has started granting permission for the commercial production of vannamei from the beginning of this year.

Alok Kumar Saha, deputy director (aquaculture), Department of Fisheries, told TBS that 8-9 companies have been given permission for commercial production of vannamei shrimp. 

Mentioning that another company was granted permission for the production of vannamei seedlings two weeks ago, he said, "Much will depend on how quickly commercial farming expands on seedling production."

Companies that have received permission expect seedlings to be available by November-December. If farming starts with them, there is a possibility of getting commercial production of vannamei running by March-April next year.

Shyamal Das, managing director, MU Sea Foods informed TBS that his company got permission for commercial farming by bringing fries from India. 

"However, vannamei juveniles are produced locally, there will be no need to import any more," he said.

He further said they are using only 15%-20% of their capacity because of the shortage of raw materials. 

"Once farming of vannamei begins, both our processing and exports will continue to increase. That's why we are giving importance to fast vannamei farming," he added.