Revised anti-dumping duties will shift global shrimp trade

Published on
September 28, 2016

The United States’ recent revisions of its anti-dumping duties on frozen shrimp, announced in early September, will have far-reaching repercussions on global trade.

For frozen shrimp from India, the United States’ preliminary duty of 4.98 percent fixed in July was reduced to 2.2 percent. The reduction will help Indian exports, but may steer more product to the U.S., rather than to Japan.

As part of its 10th administrative review, the U.S. Department of Commerce (DOC) also increased anti-dumping duties on frozen shrimp from Vietnam. The DOC selected one mandatory respondent, which will be taxed at 4.78 percent, and other companies that voluntarily responded will also be taxed at that rate. The tariff imposed on other Vietnamese firms and exporters not examined as mandatory or voluntary respondents will be a much higher 25.76 percent.

As this is prohibitive, Japan will now be a more appealing market to these firms. Thus, the DOC actions will likely result in Indian shrimp going to the U.S., and more Vietnamese going to Japan.

According to Japanese Customs data, total shrimp imports totaled JPY 12.5 billion (USD 122 million, EUR 109.5 million) in July, the latest month for with data has been released. That’s up from June, but down about a quarter from the same month last year. For 2016 through July, Japan imported a total of 70.9 million kgs, valued at JPY 80.2 billion (USD 783 million, EUR 702 million).

Ranked by total volume, Vietnam, Thailand, Indonesia and India were the four largest suppliers of frozen shrimp to Japan last year. According to the Vietnam Association of Seafood Exporters and Producers (VASEP), Vietnam, Thailand and China all lost ground to cheaper products from India and Indonesia last year, and VASEP blamed Japan’s poor economy as pushing buyers to cheaper sources, though the former two countries held onto their leading positions.

In 2016 through July, Vietnam held its top position, supplying frozen shrimp valued at JPY 17.9 billion (USD 178 million, EUR 158 million) to Japan. Indonesia gained the second spot, shipping JPY 17.3 billion (USD 172 million, EUR 153 million). India sold JPY 14.7 billion (USD 146 million, EUR 130 million) and Thailand, which has long suffered from early mortality syndrome (EMS), fell to fourth with only JPY 6.7 billion (USD 67 million, EUR 59 million), closely rivaled by wild Argentina red shrimp at JPY 6.3 billion (USD 63 million, EUR 56 million).

However, on a weight basis, India, with 14.6 million kg, edged out Vietnam, with 14.5 million kg. Indonesia was third, at 14.3 million kg, while Argentina’s volume, at 6.5 million kg, exceeded that of Thailand, 6.4 million kg.

Volume leader India has moved the majority of its production from large monodon (black tiger) shrimp to vannamei to take advantage of a global shortage in that species due to EMS cutting output in Thailand. But over-reliance on the species presents risks. Running mortality (RM) syndrome is cutting harvests this year by as much as 30 percent. The risk may make black tigers a safer bet.

Imported frozen black tiger shrimp (frozen, headless, shell-on, 16-20/lb) sold at 4,104 (USD 40.11, EUR 35.95) to JPY 4,320 (USD 42.22, EUR 37.84) per 1.8 kg block at the Tokyo’s Tsukiji wholesale market on August 31. This works out to approximately 1,061 yen per lb.

Volume of 32,185 kg was traded on the day. Prices have been fairly stable over the last three months, after having dropped sharply from August to October of 2015, then gained through January on holiday demand before beginning the current gradual decline.

Contributing Editor reporting from Osaka, Japan

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