The recent Early Mortality Syndrome (EMS) outbreak in Southeast Asia is likely to provide second-tier shrimp producers, including India and Myanmar, with new opportunities, says Rabobank.
The company says it expects the industry to become stronger, with larger, diversified and more vertically integrated multinational producers leading the next growth wave.
Gorjan Nikolik, analyst, Rabobank, said: “The EMS outbreak in China, Vietnam and Thailand has created double-digit yearly contraction in shrimp supply, leading to prices hitting record levels. However, regions unaffected by the disease are emerging to fill the supply void and are benefiting from this high price situation. Producers in Ecuador, Indonesia, India, Bangladesh and Myanmar are rapidly expanding production.”
India, among others, has the potential to increase shrimp production thanks to its large river systems providing ideal shrimp farming conditions. Rabobank says shrimp exports to the US are expected to rise by 69%, due to global supply constraints, and reach 11,000 tonnes by 2013.
He added: “Integrated producers that have access to raw material, low labour cost for processing and access to markets are, in our view, the future model of the shrimp industry.”
However, Rabobank adds that the current shrimp deficit could reverse by 2014. The recent discovery of the cause of EMS could mean a solution for the disease will be found in short to medium term, with Thailand likely to be the first of the impacted countries to recover.
