Trade

Merck Animal Health has announced its plans to acquire the aquatic-focused business of Elanco Animal Health for a staggering USD 1.3 billion (EUR 1.2 billion) in cash. The acquisition, once completed, is poised to bolster Merck’s presence in the aquaculture sector, further solidifying its position as a leading provider of animal health solutions.

The deal encompasses Elanco’s comprehensive portfolio of medicines, vaccines, nutritionals, and supplements tailored specifically for aquatic species. Additionally, Merck will inherit two crucial manufacturing facilities located in Vietnam and Canada, along with a pivotal research facility in Chile. This strategic acquisition underscores Merck’s commitment to advancing its offerings in the rapidly evolving aquaculture market.

Merck Animal Health President, Rick DeLuca, expressed enthusiasm for the acquisition, highlighting the value that Elanco’s aqua products and expertise bring to Merck’s expanding portfolio. DeLuca emphasized the potential for enhanced benefits for Merck’s aqua customers, leveraging the combined commercial and scientific prowess of both companies.

Noteworthy products included in the acquisition are CLYNAV, a groundbreaking DNA-based vaccine designed to protect Atlantic salmon aquaculture from pancreatic disease, and IMVIXA, an anti-parasitic treatment targeted at combating sea lice. These innovative solutions, along with other warmwater production treatments, are set to complement Merck’s existing product offerings, catering to the diverse needs of aquaculture operations.

Elanco Animal Health President and CEO, Jeff Simmons, expressed confidence in Merck Animal Health as the strategic buyer for the aquaculture business. Simmons affirmed his belief that Merck will continue to deliver value to aqua customers while providing growth opportunities for the acquired team.

This acquisition marks Merck’s continued focus on expanding its presence in aquaculture-based pharmaceuticals. In recent years, Merck has made significant strides in this sector, with previous acquisitions including Scan Aqua, Antelliq Corporation, and Vaki, all aimed at strengthening its portfolio and capabilities in fish health and welfare.

Goldman Sachs served as the financial advisor to Merck Animal Health for the transaction, with legal advisory provided by Covington & Burling. Merck Animal Health President Rick DeLuca concluded by expressing confidence that the addition of Elanco’s innovative aqua products will establish Merck as a leader in aquaculture, further solidifying its commitment to animal health and welfare.

Seaqua, a pioneering startup in Bangladesh’s fisheries and aquaculture sector, has achieved a significant milestone by securing a six-figure foreign direct investment (FDI) from Middle Eastern investors. This infusion of capital signifies a major leap forward for Seaqua, enabling the company to scale up its team and operations as it aims to revolutionize the blue food industry.

Founded by entrepreneur Amirul Mostafa Arefeen, Seaqua is driven by a mission to transform the global landscape of blue food through climate-smart fisheries and aquaculture practices. With the backing of strategic investment, the startup is poised to expand its impact beyond the local market and onto the international stage.

Seaqua stands out as a game-changer in the industry, addressing key challenges faced by fisheries and aquaculture through innovative solutions. By leveraging cutting-edge technology and promoting transparency, Seaqua empowers producers to access markets directly and secure fair prices for their products, while eliminating traditional supply chain inefficiencies.

With the fresh injection of capital, Seaqua plans to bolster its team and operations, solidifying its position as a leader in the blue-tech revolution. Moreover, the company is committed to utilizing blockchain technology to develop traceability maps, gathering crucial data to bridge the blue finance gap and promote sustainable practices.

In a press release, Arefeen expressed his vision for Seaqua, emphasizing the potential of Bangladesh’s abundant blue food resources to nourish communities and sustain livelihoods. Seaqua’s ultimate goal is to empower one million livelihoods in the fisheries and aquaculture sector by 2026, creating a transparent and traceable global value chain for blue food.

The recent influx of FDI from Middle Eastern investors marks a pivotal moment in Seaqua’s journey towards achieving global food security and sustainability, positioning the startup to realize its ambitious vision.

In today’s trading session, shares of Avanti Feeds Ltd and Apex Frozen Foods Ltd witnessed a significant rally, climbing up to 9% as India aims to double its seafood exports. Avanti Feeds saw a surge of 9.39% to reach a high of Rs 570.10 on the BSE, while Apex Frozen Foods witnessed a 7.52% increase, reaching a high of Rs 272.90.

The bullish sentiment follows Finance Minister Nirmala Sitharaman’s announcement during the Budget speech, where she highlighted the substantial growth in seafood exports since 2014. Sitharaman emphasized the government’s commitment to further boosting the sector through initiatives like the PM Matsya Yojana, aimed at enhancing inland and aquaculture practices.

The implementation of the Pradhan Mantri Matsya Sampada Yojana (PMMSY) is set to accelerate, with goals to increase aquaculture productivity, double seafood exports to Rs 1 lakh crore, and generate 55 lakh employment opportunities in the near future. Additionally, plans for the establishment of five integrated aquaparks were outlined to further bolster the industry.

To promote climate-resilient activities and advance the blue economy, Sitharaman announced the launch of schemes for restoration, adaptation measures, coastal aquaculture, and mariculture. However, no changes in tax slabs were proposed, with the retention of existing tax rates for both direct and indirect taxes, including import duties.

Sitharaman also highlighted the government’s focus on structural reforms and pro-people programs, which have facilitated significant improvements in employment and entrepreneurship opportunities. Notably, efforts to uplift 25 crore people from multi-dimensional poverty over the past decade were acknowledged.

As part of the Budget allocation, India is set to increase infrastructure spending by 11.1%, indicating a continued commitment to fostering economic growth and development initiatives. With these ambitious plans in place, investors have shown confidence in the prospects of companies operating within the seafood industry, leading to a surge in their stock prices.

Chennai-based aquaculture startup, Aquaconnect, has successfully raised $4 million (INR 33 crore) in a Pre-Series B funding round, with US-based S2G Ventures leading the investment. The substantial funding injection will fuel Aquaconnect’s expansion plans as it aims to bolster operations and widen its presence across India.

The startup intends to allocate the fresh capital towards enhancing its technological infrastructure, diversifying its product range, exploring new market segments, and doubling its network of partners within the next six months. Aquaconnect’s ultimate goal is to leverage its innovative ‘phygital’ approach to revolutionize the Indian aquaculture industry.

Founder and CEO of Aquaconnect, Rajmanohar Somasundaram, expressed enthusiasm about the investment, emphasizing its pivotal role in propelling the company into its next phase of growth. Somasundaram highlighted the focus on expanding operations in key markets to capitalize on emerging opportunities.

Kate Danaher, Managing Director at S2G Ventures, commented on the funding, expressing confidence in Aquaconnect’s potential to seize a significant market share in India’s burgeoning aquaculture sector. S2G Ventures views Aquaconnect as well-positioned to contribute to sustainable growth within the industry.

Established in 2017, Aquaconnect operates as a full-stack aquaculture platform, leveraging artificial intelligence (AI) and remote sensing data to forecast demand for farm inputs and harvest produce. The company facilitates offline touchpoints that connect aqua farmers with input brands, while also collaborating with non-banking financial companies (NBFCs) to provide formal credit services to retail partners and seafood buyers, addressing their working capital needs.

Japan’s agricultural, fisheries, and forestry product exports reached a historic high of ¥1.45 trillion ($9.9 billion) in 2023, according to government data released on Tuesday. Despite facing obstacles such as China’s import ban on Japanese marine products due to concerns over radioactive wastewater discharge from the Fukushima nuclear plant, exports saw a modest increase of 2.9% compared to the previous year.

The growth, however, was significantly lower than the 14.2% rise observed in 2022, largely attributed to the impact of China’s import restrictions. Despite being Japan’s top export destination, China experienced a 14.6% decline in purchases, marking the first decrease since 2011. Marine product shipments to China saw a notable drop of 29.9%, with scallops witnessing a substantial decline of 43.6%.

However, there were positive trends in other markets. Scallop exports to the United States surged, indicating successful efforts by exporters to diversify their markets. Additionally, sales of pearls experienced a remarkable 92% increase, driven by growing demand in Hong Kong following a trade fair. Green tea exports also saw a significant rise of 33.3%, supported by increased demand in the United States and Europe.

Despite the challenges posed by China’s import ban and a decline in exports in the second half of the year, the Japanese government remains committed to supporting businesses in establishing new sales routes and strengthening supply systems. With ambitious targets to raise annual agricultural and seafood exports to ¥2 trillion by 2025 and ¥5 trillion by 2030, efforts are underway to ensure continued growth and resilience in Japan’s farm and fisheries exports.

The Việt Nam Association of Seafood Exporters and Producers (VASEP) anticipates a slight recovery in Việt Nam’s seafood exports during the first half of 2024, compared to the previous year’s low base. Global economic challenges and high interest rates are expected to limit consumer spending, influencing a gradual recovery in global seafood consumption demand.

VASEP advises businesses to focus on market expansion, particularly as Việt Nam’s seafood exports to the US, the European Union (EU), and South Korea are likely to rebound in the initial months of the year. While overall demand for seafood is expected to recover, consumers are likely to concentrate on lower-priced products such as canned fish, raw fish for processing canned fish, dried fish, and dried shrimp.

Lê Hằng, VASEP’s communications director, notes that the price reduction of many aquatic species may persist until the end of the first half of 2024. Vietnamese shrimp is expected to face stiff competition in terms of price and supply from Ecuador and India, both seeking to increase their market share in key regions.

The oversupply of shrimp may extend through the first half of 2024, with a projected global shrimp production increase of 4.8% to 5.9 million tonnes for the year. The challenge of the IUU yellow card remains a hurdle for seafood exports, potentially causing stagnation in exports to the EU if not addressed in 2024.

Pangasius exports, however, present an optimistic outlook, as inventories in the US, China, and EU markets have significantly decreased. Pangasius export prices are expected to rise again in these markets. The trend of importing deeply processed and value-added pangasius products, such as fish maw and pangasius patties, is also on the rise.

VASEP forecasts a gradual recovery in Việt Nam’s seafood exports throughout 2024, with a more positive outlook in the second half of the year. The industry’s export revenue is expected to range between US$9.5 billion and $10 billion, with the shrimp sector targeting $4 billion, pangasius around $1.9 billion, and the remaining seafood products forecasted to earn approximately $3.6 billion to $3.8 billion.

In 2023, total seafood production increased by 2% year-on-year to 9.3 million tonnes, with seafood export turnover reaching about $9.2 billion, including significant contributions from shrimp.

Indonesia’s Ministry of Maritime Affairs and Fisheries is actively seeking alternative market access for its shrimp commodities, considering various countries in Asia, Africa, and Europe. Minister Sakti Wahyu Trenggono highlighted the importance of diversifying markets, including the Middle East, Eastern Europe, South Africa, and China, which has shown significant growth in the shrimp market. China’s shrimp market recorded a remarkable 49% annual increase from 2018 to 2022, reaching $6.3 billion in 2022, with Indonesia holding a modest share of 1.8%.

In response to challenges faced by Indonesian frozen shrimp exports to the US, including anti-dumping and countervailing duties initiated by the American Shrimp Processors Association (ASPA), the ministry is proactively exploring new opportunities.

The strategic approach involves collaboration with key stakeholders such as farmers, suppliers, processors, and industry associations to enhance domestic market consumption and meet global demand. The ministry also emphasizes the importance of innovation, encouraging the development of ready-to-cook and ready-to-eat shrimp products to align with market needs and trends.

Director General of Strengthening the Competitiveness of Maritime and Fishery Products, Budi Sulistiyo, acknowledged ongoing analyses of the shrimp market, both globally and domestically. Periodic distribution of the analysis results to business actors is part of the ministry’s efforts to support the shrimp industry’s potential growth.

As Indonesia actively explores new markets, the ministry’s initiatives aim to navigate challenges and promote the resilience and competitiveness of the country’s shrimp sector on the global stage.

Rajkot, India: The ongoing economic slowdown in China and decreased demand from the European market have taken a toll on fish exports from Gujarat, leading to an alarming inventory of frozen fish exceeding 1 lakh tonne. This poses a significant challenge for exporters in the region.

Gujarat typically exports seafood valued at approximately Rs 5,000 crore annually. Of this, seafood worth around Rs 2,500 crore is sent to China, constituting 50% of the total exports. However, exporters report a decline of 20% to 25% in exports to China in the current financial year.

Jagdish Fofandi, president of the All India Sea Food Exporters Association, highlighted the impact of China’s economic conditions on the demand for Gujarat’s coastal fish. He noted a decrease in restaurant-goers in China due to saving habits, affecting the demand for the popular fish. The slowdown in China’s growth rate in 2023-24 has led to high unemployment, further impacting seafood exports from Gujarat.

In addition to the China slump, the European market, which accounts for approximately 30% of Gujarat’s total seafood exports, is also witnessing reduced demand. High-end fish varieties like cuttlefish, pomfret, lobster, and jumbo shrimp, primarily destined for Europe, are affected by the European market’s struggles with soaring energy prices caused by the Russia-Ukraine conflict.

“The slowdown in demand from China and European countries has resulted in an inventory of more than 1 lakh tonne of frozen fish in our cold storages,” remarked Fofandi. Gujarat houses over 170 units involved in fish processing and export, with 150 of them located in Veraval. The overall export has seen a 20% to 30% decline, creating a challenging year for the industry. Exporters are currently holding onto their inventories, hopeful for improved conditions in the future.

India and the United States held their 14th Ministerial-level Trade Policy Forum (TPF) meeting in New Delhi on January 12, 2024, with Piyush Goyal, India’s Minister of Commerce and Industry, and Ambassador Katherine Tai, U.S. Trade Representative, co-chairing the event. The meeting aimed to strengthen bilateral trade and enhance the economic partnership between the two nations.

The discussions covered various aspects of the economic relationship, including Joint Initiatives, the establishment of a Joint Facilitative Mechanism (JFM) to address non-tariff barriers, and the adoption of High-Level Principles on the Digitalization of Trade Documents.

Discussions also touched upon a potential Social Security Totalization Agreement to support Indian IT professionals working temporarily in the U.S. Another significant point of discussion was India’s request to lift the ban on exports of wild-caught shrimps, a matter affecting Indian fishermen and trade with the U.S.

Under the Resilient Trade Working Group, the focus remained on India’s designation as a TAA Compliant country, contributing to supply chain integration for both nations. Discussions extended to the need for increased U.S. FDA inspections in India, challenges faced by business visitors due to visa processing times, and India’s interest in restoring its beneficiary status under the U.S. Generalized System of Preferences program.

The Ministers acknowledged the robust momentum in India-US bilateral trade, with the trade volume likely surpassing $200 billion in calendar year 2023. The positive trajectory in the relationship was emphasized, with both nations settling longstanding trade disputes at the WTO during significant visits in 2023.

As vibrant democracies, India and the USA continue to deepen ties through people-to-people contacts and collaborations under QUAD, I2U2, and IPEF. Ambassador Tai’s visit further strengthened the positive trajectory in the India-US relationship.

DHAKA: Bangladesh’s Fisheries and Livestock Minister, Md Abdur Rahman, announced today the government’s commitment to increasing export volumes in the fisheries sector by focusing on the collection of marine fishes. Addressing journalists at the ministry, Minister Rahman highlighted the immense potential within the marine fish industry, expressing plans to enhance the collection of marine fishes for export to various countries.

Assuming office on January 11, Minister Abdur Rahman emphasized the significant role of the fisheries and livestock sector in contributing to the lives and livelihoods of the population, meeting the protein demands of approximately 18 crore people.

Responding to a journalist’s question, Minister Rahman outlined the government’s strategy to ensure the availability of proteins, aiming to meet domestic demands. He underscored the government’s commitment to maintaining affordable prices for essential protein sources such as eggs, milk, meat, and fish, especially during the holy month of Ramadan.

Prior to his announcement, Minister Rahman engaged in discussions with officials and employees of the Fisheries and Livestock Ministry, outlining the government’s vision to strengthen the fisheries sector and promote sustainable growth.

The government’s proactive approach to harnessing the potential of marine fisheries reflects a broader commitment to economic development and food security in Bangladesh.