Trade

Indian seafood companies are redirecting their focus toward the domestic market, investing in high-value items such as shrimps, squids, lobsters, and seer fish. The move comes as a strategic response to the downturn in global exports, with the pandemic forcing a shift in the dynamics of the largely unorganized domestic seafood market.

Shivam Gupta, Director of WestCoast Fine Foods, highlighted the changing landscape of the local seafood market, revealing that it is growing at a rate of 9-10%. There is a noticeable transition towards organized players in the industry, with these entities experiencing growth rates of 30% or more.

The availability of shrimps in India has significantly increased, driven by booming aquaculture activities that have pushed production beyond 9 lakh tonnes. While over 7 lakh tonnes are exported, seafood processors and exporters believe that approximately 30% of the production can find a market in the domestic sphere. This shift is attributed to competitive domestic prices compared to export prices, with the export market witnessing a decline due to oversupply and economic challenges in major markets like the US and Europe.

Mathew Joseph, COO and Co-founder of FreshToHome, a leading online seafood and meat platform, highlighted the changing preferences in the domestic market. Even high-value items like vannamei shrimps, seer fish, and tiger prawns, previously earmarked for export, are finding substantial demand domestically. FreshToHome has invested around Rs 500 crore in infrastructure and transportation to ensure product freshness and is experiencing strong growth.

The acceptance of surimi products, including crab sticks, has also grown in the domestic market. Gadre Marine Export, a leading surimi exporter, reported doing Rs 35-40 crore worth of business in India, with the domestic market growing at 25-30%.

Kings Infra Ventures Ltd., specializing in aquaculture farming and seafood trade, is entering the domestic market with plans to set up a chain of quick-service restaurants (QSRs). The company intends to invest around Rs 100 crore to establish QSRs, initially setting up 100 in Kerala and another 200 in Bengaluru under the brand Kings Bento.

Abad Fisheries, a major seafood exporting company, has seen business worth Rs 200 crore in India, leveraging its 25 cold storages across southern states. CMD Anwar Hashim highlighted the strengthening domestic market, with shrimp becoming a regular feature even in weddings.

While the domestic market shows promise, industry experts believe more needs to be done to develop it further. Suggestions include government-led campaigns similar to those for eggs to promote seafood consumption, and joint efforts to raise awareness about the health benefits of seafood, creating robust cold chain networks.

Ravi Kumar Yellanki, President of the All India Shrimp Hatcheries Association, emphasized the need for collaboration between the government and the industry to enhance awareness and build infrastructure facilities such as cold storages in harbours and fish markets.

Research organization Expert Market Research projects a compound annual growth rate (CAGR) of 9.60% in the Indian shrimp market over eight years, reaching 2.12 million tonnes by 2032. Despite challenges in global exports, the optimism in the domestic seafood market signals a positive trajectory for the Indian seafood industry.

Source: Money Control

Japanese trading giant Mitsui & Co. has announced a significant investment of US$360 million in Industrial Pesquera Santa Priscila (IPSP), the world’s largest shrimp farming company based in Ecuador.

Mitsui, known for its core business in commodity and energy trading, is acquiring shares from the founders of IPSP, marking a substantial financial commitment to the booming shrimp industry. Following the transaction, IPSP will become an equity method affiliate of Mitsui, although the specific size of the stake has not been disclosed.

Mitsui already holds a notable 35.1% stake in Minh Phu Seafood, the world’s largest shrimp processing company located in Vietnam. The decision to invest in IPSP aligns with Mitsui’s strategic vision of expanding its influence in the shrimp industry, encompassing various facets of the value chain, including breeding, feed, and farming.

The move is driven by Mitsui’s anticipation of an increasing global demand for shrimp as a protein source, attributed to both the rising global population and the growing popularity of low-calorie food options. The company aims to solidify its position as a leading global player in the shrimp industry by strategically extending its reach upstream in the value chain.

This investment reflects Mitsui’s forward-looking approach, recognizing the long-term potential and sustainability of the shrimp market amid evolving consumer preferences and global demographic trends.

Ho Chi Minh City: Vietnam is setting its sights on achieving high earnings in its commercial fishing sector, aiming to produce 1.7 million tonnes of tra fish and generate up to US$2 billion from exports in the current year, according to a report by Vietnam News Agency.

Deputy Minister of Agriculture and Rural Development, Phung Duc Tien, emphasized the need for the fishery sector to be well-prepared with plans to navigate the increasingly competitive market landscape and address the stricter regulations and technical barriers imposed by importing countries.

Despite facing challenges in 2023, including decreased consumption demand in European and Chinese markets, this year is anticipated to bring positive signs for Vietnam’s tra fish industry, stated Tien.

Le Hang, Communications Director of the Vietnam Association of Seafood Exporters and Producers (VASEP), highlighted that while there was a reduction in market share in certain areas, the export of tra fish is showing positive trends in markets such as China, Mexico, Canada, Brazil, and the United Kingdom (UK).

Hang noted a growing demand for Vietnamese tra fish in various markets, particularly for deeply-processed products. China, a stable importer of Vietnamese tra fish, has expressed a willingness to expand aquatic product imports from Vietnam. The United States remains a key market for Vietnamese tra fish products.

The European Union (EU) market, traditionally significant for Vietnamese tra fish, is witnessing a resurgence in demand, providing a potential bright spot for exports in the coming year. China is expected to experience high growth in tra fish imports in 2024.

Beijing: Pakistani aquatic product exporters are increasingly benefiting from zero tariffs and gaining a deeper understanding of the China-Pakistan Free Trade Agreement (CPFTA). Ghulam Qadir, the commercial counselor of the Pakistani Embassy in China, revealed that new species have been registered under the second phase of CPFTA, paving the way for increased exports to China.

Currently, numerous Pakistani companies are actively seeking to enhance collaboration with Chinese partners to boost their aquatic product exports. A recent development saw a Pakistani agricultural delegation, led by Shahid Firoz, representative of Pakistan Arfeen Group and vice chairman of Belt and Road Development Company, visiting the China Aquatic Products Processing and Marketing Alliance (CAPPMA) in Beijing on September 13. The delegation engaged in in-depth discussions on advancing China-Pakistan cooperation in the aquaculture industry.

Shahid Firoz expressed the primary purpose of their visit, stating, “Our company is a comprehensive enterprise in Pakistan with businesses covering trade, food processing, agriculture, etc. We also own abundant water resources such as lakes and reservoirs. The main purpose of our visit is to establish connections with excellent aquatic product companies.” Firoz further hoped for assistance from Chinese enterprises to facilitate aquaculture development and promote trade cooperation.

Cui He, chairman of CAPPMA, emphasized the association’s willingness to support Arfeen Group in building partnerships with other aquatic product companies. He stated, “We have rich experience and knowledge in the circulation and processing of aquatic products. We are willing to provide necessary technical and marketing support to Pakistani friends for the development of the fishery industry.”

Recognizing the immense potential in Pak-China cooperation in the aquaculture industry, Shahid Firoz expressed readiness to take actions to deepen collaboration. He highlighted areas such as improving production efficiency and product quality in the aquaculture sector through the application of China’s advanced technology and experience. Additionally, Firoz suggested joint efforts to promote the processing and sales of Pakistani aquatic products in the Chinese market. He also emphasized the potential for increased imports of Chinese fish fry and fish feed through enhanced marketing with Pakistani support.

Global production of fishmeal and fish oil experienced a significant decline of 52% in July 2023, primarily due to a sharp drop in Peruvian supply following the cancellation of the country’s anchoveta season. According to IFFO, The Marine Ingredients Organization, Peru’s fishmeal production has seen a staggering 76% year-over-year decrease through July, dragging down global cumulative fishmeal production by 31% year over year.

Lower catches in reduction fisheries worldwide, except for Iceland, the North Atlantic, and Africa, contributed to the overall decrease in global production. However, the main reason for the substantial drop in global production, which was only down by 10% year over year through June 2023, was Peru’s decision to cancel the main anchovy fishing season in the north-central zone in June 2023. The Peruvian Production Ministry (PRODUCE) made this decision to ensure the sustainability of the biomass.

The closure of the season and the subsequent rise in aquafeed prices have impacted seafood companies globally, from Norway’s Austevoll Seafood to tilapia producers in China. While Chinese fishmeal demand has decreased in 2023, and local production is also depressed, the country has managed to compensate with imports, according to IFFO.

China lifted its final domestic fishing ban in areas of the Yellow Sea and East China Sea on 16 September. Although operations in open fishing grounds have resulted in below-par landings, similar to the same period last year, the current slowdown in fishmeal consumption is likely linked to the approaching end of the main aquafarming season and expected lower-than-average demand from the pig-farming sector.

“The current slowdown in fishmeal consumption is likely to be related to the imminent end of the main aquafarming season and to an expected lower-than-average demand of feed from the pig-farming sector,” stated IFFO in its monthly update. “Stocks of imported fishmeal are currently reported as being not far from the previous five-year average, as the Chinese traders and end-users have so far managed to navigate through the drop in the Peruvian supply of fishmeal and fish oil by increasing their imports from other origins.”

However, off-takes of imported fishmeal from main ports’ warehouses are below the average of the previous five years, according to IFFO. Global fish oil production also saw a 30% decline through July, with Chile being the only country to report higher year-over-year totals for the month.

The Bay of Bengal off Visakhapatnam is witnessing a bountiful harvest of premier shrimp varieties, but the fishing community faces a dilemma as buyers remain scarce. Andhra Pradesh’s largest fish landing facility at the fishing harbour in Visakhapatnam is bustling with activity, with around 600 mechanized boats venturing into the sea to reap the rewards of the abundant catch.

Despite the high-quality harvest, the fishing community is grappling with an unusual season marked by a surplus of brown prawns, Asian tiger shrimps, three-spot crabs, and some blue crabs. However, the market reflects a different reality, with only four out of 23 exporters actively buying the produce.

This limited demand has led to a drop in prices, with boat owners like Narasing Rao highlighting the predicament. Rao notes, “This year we have a good catch. We are especially getting the export quality ‘brown prawns’. But only four exporters are buying this now though we have 23 exporters here. Because of this situation, we are selling one kg brown prawns at Rs 370. Last year we sold this at Rs 450.”

The fishing community attributes the reduced demand to exporters favouring cultured shrimps over sea-harvested shrimps, despite a government rule stipulating that 25 percent of the export volume must comprise sea-harvested shrimps. Workers at export firms express concern that the state and central governments have not taken adequate measures to address this issue.

With each boat returning with substantial quantities of brown prawns, averaging between 600 kg to a tonne, the market is flooded, leading to a further decline in prices. The situation raises challenges for the Vizag harbour, which has a total of 700 mechanized boats, 600 of which are engaged in fishing activities.

Kolkata, India: IFB Agro Industries disclosed challenges in its alcohol business as it grapples with the impact of a 30% excise rise imposed by the West Bengal government, leading to a notable surge in liquor prices. The company also revealed plans for its new fish feed manufacturing facility in Odisha, set to be operational from March 2024, as part of a strategic move to enhance its presence in the fish feed segment.

Despite West Bengal being a significant market for IFB Agro, the decision to establish the fish feed plant in Odisha was driven by certain challenges faced in the former and the anticipation of a more favourable business environment in the latter. The company, however, did not provide specific details regarding the issues encountered.

The liquor business, a major revenue stream for IFB Agro, witnessed a sharp decline in volume due to the substantial 30% increase in Maximum Retail Price (MRP). The company, aiming to fortify its position in the fish feed sector, highlighted its commitment to setting up the manufacturing facility in Balasore, Odisha.

IFB Agro officials declined to comment on the challenges faced in West Bengal. Meanwhile, the marine products division of the company reported positive performance, with a 30% revenue growth in exports and an impressive 87% growth in the domestic food business.

The consolidated net profit for FY23 stood at Rs 49 crore, reflecting a decrease from the Rs 58 crore recorded in the previous fiscal year. IFB Agro’s strategic move to diversify into fish feed production aligns with the company’s efforts to navigate challenges in its liquor business and capitalize on opportunities in the evolving market landscape.

Japan has expressed its eagerness to collaborate and invest in Bangladesh’s blue economy, with a special focus on the fisheries sector. Japanese Ambassador to Bangladesh, Iwama Kiminori, conveyed this interest during a courtesy call on Fisheries and Livestock Minister SM Rezaul Karim at the secretariat in the capital.

Discussions during the meeting covered a range of topics, including Prime Minister Sheikh Hasina’s recent visit to Japan, trade and commerce expansion, Japan’s investment in Bangladesh’s major development projects, and potential areas of cooperation in the fisheries and livestock sectors.

Minister SM Rezaul Karim highlighted the immense investment opportunities for Japanese investors in establishing a diversified processing industry for fish and animal products in Bangladesh. He underscored the strong friendship and cooperation between the two nations, expressing optimism about further advancing this collaboration.

“Japan is a genuine friend and one of the most important development partners of Bangladesh. The role that Japan is playing in the development of Bangladesh is a unique example of selfless friendship. We can further advance the cooperation between the two countries,” Minister Karim stated.

Acknowledging Japan’s extensive cooperation in the qualitative development of Bangladesh, he cited examples such as Japan’s technical and financial support for mega projects like the Matarbari deep-sea port, the third terminal of Hazrat Shahjalal International Airport in Dhaka, and the Dhaka Metro Rail.

The minister highlighted the potential for cooperation and investment in the fisheries and livestock sector, expressing hope for increased bilateral collaboration. Japanese Ambassador Iwama Kiminori affirmed Japan’s interest in supporting Bangladesh’s blue economy, especially in the fisheries sector.

Ambassador Kiminori suggested the possibility of a joint consultation meeting between the two countries and emphasized the ease of transporting goods due to direct communication. He also stressed the importance of diversifying food products in Bangladesh. The discussions concluded with a shared commitment to exploring avenues for joint initiatives and enhancing bilateral cooperation in the identified sectors.

India-based Zeal Aqua has inked a European supply agreement with Lenk Frozen Foods, a seafood sourcing and selling company based in Bangkok, Thailand. Zeal Aqua, operating 160 farms across 300 hectares in Gujarat, primarily grows Aquaculture Stewardship Council (ASC)-certified black tiger shrimp with an annual output of 2,000 metric tons. The company, known for its antibiotic-free farming practices, was the first ASC-certified black tiger shrimp farmer in India and also farms ASC-certified vannamei shrimp.

Under the agreement, Zeal Aqua has transferred its European business development activities to Lenk Frozen Foods, which specializes in seafood procurement from South and Southeast Asia. Lenk Frozen Foods, with subsidiaries in multiple countries, primarily serves the European market.

Zeal Aqua’s Managing Director, Rohan Navik, expressed enthusiasm about working with Lenk Frozen Foods to supply high-quality black tiger shrimp to the European market. The partnership aims to target an output of over 2,000 MT of black tiger shrimp in 2023, with approximately 50% of the volume earmarked for the EU market.

Lenk Frozen Foods’ Managing Director, Peter ter Heide, sees the collaboration as a strategic move to strengthen its Asian network and meet the growing demand for black tiger shrimp internationally. The focus will include expanding markets in Southern Europe, where black tiger shrimp holds a strong niche alongside vannamei.

The move aligns with Lenk’s commitment to responsible and sustainable aquaculture. Ter Heide emphasized the importance of working with partners like Zeal Aqua, which integrates expertise in farming and sustainability into its business model, evident through ASC certification and the cultivation of native species such as Penaeus monodon.

Discussions between Saudi Arabia and China at the Global Investment Promotion Conference in Shenzhen indicate growing prospects for investments in the aquaculture sector.

Representatives from Saudi Arabia’s Ministry of Environment, Water, and Agriculture engaged with over 60 specialized Chinese firms to explore and expand opportunities, aiming to showcase investment prospects, foster expertise exchange, and facilitate private sector involvement in Saudi Arabia’s aquaculture sector.

The National Fisheries Development Program, part of the ministry’s delegation, played a pivotal role in these discussions. Launched in 2015, the program targets $5 billion in private sector investments by the end of the decade.

Central to this initiative is the National Aquaculture Group (Naqua), the largest firm in the Middle East’s aquaculture industry. The program focuses on expanding aquaculture to create new jobs, with half allocated for Saudi nationals, significantly increasing seafood volumes for export and contributing to economic growth.

Aquaculture, growing at 6% annually globally, is viewed as a key element for improving food security, job creation, rural development, and environmental sustainability. Ali Al-Shaikhi, CEO of the National Fisheries Development Program, emphasized the importance of aquaculture in enhancing the quality of life and promoting the seafood industry in Saudi Arabia.

The collaboration with China aligns with Saudi Arabia’s Vision 2030 plan to produce 600,000 tons of fish annually, creating around 200,000 direct and indirect jobs in the fisheries sector and diversifying the economy.