SEAFOODNEWS.COM [Schuichan] translated by Amy Zhong – March 5, 2018
Since the second half of 2016, India has encountered great difficulties in white shrimp exports to the European Union, because the EU has discovered antibiotics usage in the country’s aquaculture exceeding those of the EU’s standard. What’s worse, the U.S. Food and Drug Administration has found high levels of salmonella in several batches of India’s shrimp products. Thus, European importers started looking for new shrimp suppliers. China should have been the first choice, since it has a large white shrimp aquaculture industry.
However, customs statistics Northern European buyers have not been interested in China’s white shrimp. China has exported 89,026 tons of white shrimp last year, but it sold only 554 tons to Belgium, the largest buyer in Northern Europe. Export volumes included 550 tons to England, 536 tons to the Netherlands, 118 tons to Germany and 53 tons to Denmark. Meanwhile, its shrimp exports reached 2,226 tons to Chile alone, higher than the total export volume to the European countries mentioned above.
So what is holding back China’s shrimp export to Europe? First, its white shrimp are mostly for domestic sales, which in turn squeezes its export volumes. The country’s domestic market is expanding at a surprisingly rapid rate, said one anonymous European buyer. Many Chinese aquaculture companies would rather sell shrimp to domestic consumers than tailor products in accordance with the high requirements of European buyers and sell them at prices acceptable to those buyers. One large European importer said he imported squid and a mix of seafood products but no white shrimp from China. Another said that he bought shrimp meat from China but the volume was low.
Another hindrance to Chinese white shrimp exports is high tariff rates. One large import company bought China’s white shrimp for further processing only because it could be free of tariffs under the EU’s end-use authorization. Most European buyers are faced with a 12 percent tariff rate while importing products from China, but the rate is only 4.2 percent for purchases from Vietnam and India. Although the EU has further strengthened supervision of shrimp imported from India, the cost is still lower than the imports from China.
Moreover, the cost is comparatively high in China’s white shrimp farming. According to the second largest importer in the Northern Europe, the ex-factory price of China’s white shrimp is much higher than those of other aquaculture countries. September is the white shrimp harvest season in China, so prices are lower than other months. But in Guangzhou, the average ex-factory price is about U.S. $8.57 per kg for shrimps at the size of 60 shrimp/kg, while such shrimp are sold at around U.S. $5.53 per kg in Thailand and U.S. $5.19 in India.
China’s white shrimp industry is undergoing a transition, which also takes a toll on its export to the EU. In the last two years, China’s white shrimp export to the U.S. has hit another low at 5,000 tons. In 2015, the U.S. bought 8,268 tons of white shrimp from China, while the number dropped to 4,856 tons in 2017. Guolian Aquatic used to sell most white shrimp to the U.S., but now American buyers can only get their shrimp through its subsidiary, Sunnyvale Seafoods. Meanwhile, Japan bought 19,636 tons of China’s white shrimp; Spain, 10,603 tons; Malaysia, 7,962 tons; and Russia, 5,777 tons. China exported a total of 89,026 tons of white shrimp in 2017, while its production reached 525,000 tons in total.
In the past, Chinese preferred fish to shrimp. But with domestic consumption increasing and further development of the seafood catering industry, white shrimp has become increasingly popular and they are expected to replace freshwater fish as the main source of aquatic protein. The country expects an increase in middle-class families. By the year of 2022, 76 percent of Chinese families are predicted to belong to this class — at the same time, its white shrimp consumption is predicted to exceed 2 million tons. This means the corresponding market value is to reach as high as 100 billion yuan (~$15 billion USD). Though the future seems glowing, China’s white shrimp aquaculture first has to deal with ongoing problems of shrimp seed, environment, technologies, feed and market substitutes. Without solutions, it is still too early to tell what the future will holds.