Indian shrimp production key in 2016 as US buyers await lower prices on raised production. In the run-up to the Seafood Expo Global the market has been quiet, as it has for a while now, US Buyers said. Prices have softened a little recently, mainly because of “a lack of sales and people turning inventories into cash”, he said.
On program business, buyers are remaining cautious, waiting on an expected increase in production out of Asia which will bring prices down, he added. “I’m not sure if and when that will happen. To me it really depends on what happens in India, and right now they are having problems due to weather and disease,” the source said.“To me they are the key. If production increases there then the market will drop, otherwise it’s Indonesia that everyone will turn to, and the market will dip then move up.” Jim Gulkin, managing director of Thai importer and exporter Siam Canadian, agreed that buyers were waiting to see if prices would dip. “Whether true or not, there is anticipation among many importers and end users that prices will soften further, so buying is more hand to mouth now, and with caution.”
“India production is likely to be moderately higher than last year,” he said. “There was flooding late 2015 and there are ongoing disease problems which have definitely impacted production.” “However, farming area has increased which will likely mitigate those production problems so ultimately probably not much difference in overall production between 2015 and 2016.Indonesia is the most competitive origin shrimp at this time, said Gulkin; there seems to be a reasonable amount of interest, predominately from the US market, but only at lower price points compared to the past few weeks. “If they rise $0.10- $0.15 per pound higher, interest quickly drops off. Indonesian prices are starting to firm slightly.”
The US buyer agreed that Indian, Thai and Vietnamese prices are higher than Indonesian, and so sales to the US and elsewhere from those countries are currently slow. Looking ahead, he suggested both Vietnam and Thailand would have only a limited window during the summer with competitive prices.
“We booked goods last fall, still waiting for shipment, so they are delaying; waiting for prices to drop, which I don’t think will happen.” In Ecuador’s case, if they cannot match China’s demand then the latter will look to Thailand and Vietnam, pushing prices up, he predicted. “Overall I don’t see a major drop on the market. Prices right now are at reasonable levels.
There are problems in production of salmon, squid, snow crab, live lobsters; one retailer told me they will be promoting shrimp more this summer.”Gulkin, meanwhile, noted India raw material prices had firmed up over the past ten days, after showing a weakening trend fo several weeks prior. “We still expect their production will increase through April or May, and we still expect lower pricing,” he said. Thai production is expected to increase 10-15% over last year.
Landings are expected to increase around the end of April and into May, he added.Vietnamese production is “still facing challenges including the effects of the drought and salinization of farming areas”. Raw material imports from India, and to a lesser extent Indonesia, will continue to be an important factor, and are expected to increase for 2016. “Overall, prices are expected to remain soft for the next 45-90 days. Buying should increase in May or June, and prices will likely — at least temporarily — bottom out sometime in June or July.”
India’s shrimp production will be key to the global market in this year
Source : undercurrentnews
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