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March 31, 2015

United States

Where Are Shrimp Prices Going?

 

Don Berger (email donb@cleanfish.com, cell phone 1-415-308-5677) director of frozen products at Clean Fish, a company that brings together artisan producers—both fishermen and farmers—and champions them in the marketplace under traceable and transparent brands, reports on The Shrimp List:

 

The prices of shrimp came down due to over supply relative to the demand.  There is much discussion about disease, but as far as the USA is concerned, 2014 had the third largest imported volume ever.

 

I see the huge volumes of shrimp coming from India and wonder what impact this will have on the environment.  Will these new producers follow the good example set by more established farmers?  Or will they simply run an eight-inch pipe out to the ocean and pump away?   Many new producers increased output in hopes of catching the top of the market, now with prices moving lower what short cuts will they take to preserve their margins?

 

The current shrimp market will go down another 20% before buyers are inclined to increase purchases.  Until Walmart, Kroger and other large retailers are able to merchandise large shrimp at $4.99 a pound, prices will continue to trend lower.  Once prices support this price point, demand will improve.  Retail demand is the engine that drives the shrimp market; unfortunately these recent markets have greatly diminished this demand.

 

One other variable to consider is the USA frozen storage capacity.  It is not uncommon for there to be 2-6 months of supply on hand in storage at any give time.  With holiday sales being so poor and imports strong, it is likely there were large carry over inventories from 2014 in 2015.

 

Source: The Shrimp List (a mailing list for shrimp farmers).  Subject: Shrimp Disease in the World.  Donelson Berger.  March 31, 2015.

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