Penaeus vannamei: Global production rebounded strongly in 2021 and is expected to grow by more than 10%.

At IFFO's annual meeting, Gorjan Nikolik, senior analyst at Rabobank and an industry figure, said that global shrimp production is expected to grow by 10% in 2021, and even this figure "could be a conservative amount".

"It may even be more, but I don't have good data about China," he said. "Our rebound will be enough to cover the losses in 2020." Raboam's model shows that even beyond this new high, the global shrimp supply is likely to continue to grow in 2022 and 2023.

Supply from major shrimp producing areas worldwide

At the heart of this year's double-digit sales surge are two big producers, Ecuador and India. In Ecuador, Nikolik said, 2021 will be an "extraordinary year", with prices and export volumes on an upward trend since January. As of July, Ecuador's production had increased by 22% compared to 2020, production had increased by 16%, and Nikolik believed that the country's annual output growth rate would exceed 18% by the end of the year.

Ecuador's real success stems from shedding its dependence on a single market during COVID, "Ecuadorian products were transferred to Europe and the United States within a few months. Now the Chinese market is making a comeback, but Ecuador already has a very strong position in the United States and the European Union. The average farm price of medium-sized shrimp in 2021 rose by almost $2/kg over the course of the year due to market shifts. "We raised the price of exports from $3.2/kg to more than $5/kg," which will continue to grow in 2022, despite high prices and high export volumes. ”

Meanwhile, in India, despite setbacks throughout the year – from COVID disruptions to soaring production costs to hurricanes – the value of Indian shrimp exports grew by a staggering 37% in 2021. "Not only did they make up for the losses in 2020, but they're now much higher than in 2019," Nikolaik said.

India overtook China in 2018 to become the world's largest shrimp producer; but last year's 25 percent drop in supply allowed it to be replaced by Ecuador. However, if the current rate of production growth continues until the end of the year, the two countries are expected to produce 750,000-800,000 metric tons of White Shrimp in 2021.

In terms of price levels, India's dominant share of the recovering U.S. market means that even with such huge supply growth, prices for medium- and large shrimp remain "relatively firm," despite slipping in the middle of the summer. "India has about 30-40 percent of the processed peeling market in the United States. This market is actually a retail market and is doing very well," Nikolik said. "And China is picking up from its lows at the beginning of the year – so India reached a new record in July, reaching 80,000 tons in one month!"

In Southeast Asia, Vietnam's exports in the first half of the year saw strong double-digit growth despite the COVID lockdown imposed in the summer. One of the main factors in this growth is the United States. In the first half of the year, the United States became Vietnam's largest sales market for value-added White Shrimp, accounting for 38% of all such exports. According to the Vietnam Seafood Exporters and Producers Association, U.S. consumer appetite for black tiger shrimp has also increased, with imports doubling year-on-year to $34 million from $17 million.

Indonesia saw a surge in exports in 2020, but Nicolik explained that most of the extra exports came from supply diverted from the country's domestic market. So as Indian production recovers from last year's shortages, Indonesia's export growth slows in 2021. Because "they are highly dependent on the United States, more than 80 percent of their exports go to the United States." ”

The three major shrimp markets in the world

Traditionally, the global shrimp market has been dominated by three main markets: the European Union, the United States and China. These three account for 70% of the 3 million tonnes of global shrimp imports in 2020, but the situation will vary in 2021.

First, it's no secret that the U.S. demand for White Shrimp in South America in 2021 is unprecedented. The return of the foodservice market, coupled with the retention of new retail customers during the pandemic, has led to a spike in shrimp imports and prices in the country. "As a result, as of July, we saw a 27% increase in year-to-date value.

The Urner Barry White Shrimp Index has exceeded price levels in 2019 and 2018," Nikolik explains. "So we see good prices and good demand, and the U.S. is also a real driver of global shrimp consumption."

While not as impressive as the recovery on the other side of the Atlantic, the European market also showed a recovery since the closure of foodservice in 2020 in 2021. "There hasn't actually been a major adjustment to shrimp in Europe, demand just shifted from foodservices to retail last year; in terms of growth, growth in 2020 was very flat, meaning that as of the end of July, total imports of frozen warm water shrimp imported from the EU and the UK increased by 14.7% and value by 14.3%."

Finally, China is the only one of the three major shrimp markets this year where demand has not returned to pre-pandemic levels. As of the end of August, imports were still down 15.6 percent and volume was down 17.9 percent, according to Rabobank data.

Since the summer of 2020, China has conducted COVID tests on imported overseas seafood, and demand has "fallen off a cliff". "The good news is that things are getting better. Production and imports in 2021 show signs of recovery, with August being much better than the same period in 2020," Nikolik said. "The bad news is that they're still below 2019. Even so far this year, it's even far below 2020. ”

Source: YuYipai