Mahdi Mesbahi is an export manager at Shrimpy Co., an Iranian shrimp production and exporting firm.
He recently spoke with SeafoodSource about how his industry relies on China and the domestic market for its sales, and explained the difference between approaching both markets.
Iran aims to export USD 2 billion (EUR 1.8 billion) worth of seafood and ship at least 2.6 million metric tons (MT) of seafood products by 2026, and Mesbahi outlined whether the industry can achieve that growth over the next few years.
SeafoodSource: Can you outline the growth trends in Iranian exports to China and how much it relies on the market for growth?
Mesbahi: Iran's seafood exports to China, particularly shrimp, have grown significantly. From mid-March to mid-August, Iran exported over 118,000 MT of fishery products valued at USD 187 million (EUR 176 million) to China, which was up 33 percent in value and 43 percent in volume compared to the same period last year, respectively.
During the same time frame, Iran’s shrimp exports to China were valued at USD 98.5 million (EUR 93.5 million) – accounting for 32 percent of total seafood export value. This was a 26 percent decline from the previous year.
Ecuador has a 66.2 percent share of China’s frozen shrimp imports – the largest category in China’s seafood imports – followed by India and Thailand.
This competitive environment underscores the importance for Iranian exporters to maintain high standards and competitive pricing to strengthen their position in the Chinese market. To capitalize on this opportunity, Iranian traders should focus on quality assurance, competitive pricing, and understanding China's import regulations to enhance their market share.
SeafoodSource: Can you expand a bit more on the rapid growth of shrimp production in Ecuador and India and how it has impacted Iran's seafood export market, particularly in terms of market share and pricing?
Mesbahi: Both countries have established themselves as dominant players in the global seafood trade, leveraging advanced farming techniques, economies of scale, and favorable trade policies to flood markets like China with competitively priced shrimp. Ecuador holds a commanding share of China’s shrimp imports, driven by its focus on large-scale, high-yield aquaculture operations and year-round production capabilities.
This increased supply from major producers exerts downward pressure on prices in key markets, including China, making it more challenging for Iranian exporters to compete. Iran’s shrimp industry, while growing, operates on a smaller scale with higher production costs compared to giants like Ecuador. This limits Iran's ability to match the low prices offered by its competitors, especially in a price-sensitive market like China. As a result, Iranian exporters may struggle to secure large volumes or premium pricing, which can erode profitability.
Additionally, the competition intensifies the need for Iranian producers to differentiate their products. Meeting international quality standards, ensuring sustainable practices, and focusing on niche markets or premium product segments, such as organic or traceable shrimp, could help counteract the pricing disadvantage. Establishing strong trade relationships, investing in marketing, and leveraging Iran’s geographical proximity to China can also play a role in maintaining a competitive edge.
SeafoodSource: Do you see China as the key target market for Iranian exports, or is the domestic market more important?
Mesbahi: China is undoubtedly a key target market for Iranian seafood traders, especially as earnings in foreign currencies provide a significant advantage amid Iran’s economic conditions.
While smaller in scale compared to China, the domestic market provides steady demand, particularly in coastal regions and urban centers where seafood consumption is rising. This market benefits from lower logistics costs and avoids the complexities of international trade, such as tariffs and regulatory hurdles.
However, the Iranian market is more price-sensitive due to ongoing economic challenges, making exports to China potentially more profitable.
SeafoodSource: What’s the best approach for Iranian seafood companies in terms of maximizing both domestic and export sales?
Mesbahi: The best approach for Iranian seafood traders is a balanced strategy that leverages the strengths of both markets. Targeting China allows for tapping into a vast, high-value consumer base while maintaining a strong domestic presence to ensure stability and diversification.
Dependence on a single market like China can pose risks, including exposure to geopolitical and economic changes. Success in the export market, driven by adherence to international standards, can enhance a brand’s reputation domestically, while a solid local market base can act as a safety net during international disruptions.
SeafoodSource: How important are other markets like the E.U. and United Arab Emirates for Iran's shrimp sector?
Mesbahi: For Iranian shrimp exporters, the E.U. represents a premium market with the potential for high revenue. However, entering and sustaining a presence in this market is challenging due to stringent regulatory standards, including food safety requirements and traceability and sustainability certifications.
Issues related to antibiotic residue or improper documentation have occasionally hampered Iran's access to the E.U. market, as well. Nevertheless, access to this market enhances Iran's reputation globally and opens doors to other high-value markets.
The United Arab Emirates serves as a vital market for Iranian shrimp, primarily due to its geographical proximity and cultural ties. With its role as a trading hub, the U.A.E. not only consumes significant quantities of shrimp domestically but also reexports seafood to other Gulf Cooperation Council (GCC) countries, the Middle East, and even parts of Asia and Africa. This makes it a strategic partner for Iranian seafood exporters.
Unlike the E.U., the U.A.E. market is less regulated and more accessible, though it still values quality and competitive pricing. The strong presence of Iranian businesses and communities in the U.A.E. facilitates trade relationships and reduces barriers to entry.
SeafoodSource: Several Middle Eastern countries like Saudi Arabia, Oman, and Iran aim to rapidly increase their aquaculture production. Are these plans realistic?
Mesbahi: The ambitious plans by Middle Eastern countries to rapidly expand their aquaculture industries are bold and forward-looking, but their success hinges on several critical factors, particularly their reliance on imported expertise, technology, and inputs. While the region offers some natural advantages, such as warm coastal waters and proximity to major markets, there are substantial challenges to achieving these goals.
Many countries lack a robust aquaculture knowledge base and rely on international consultants, technicians, and companies to set up and manage operations. This dependency can drive up costs and delay projects if the transfer of knowledge is slow or incomplete. Feed, broodstock, and equipment are often imported, making these industries vulnerable to global supply chain disruptions and price volatility.
While these countries are making substantial investments and have the financial resources to support large-scale development, the timelines and scale of their ambitions may be overly optimistic. However, gradual progress with a focus on sustainability and regional markets seems achievable. Success will depend on their ability to localize expertise, develop infrastructure, and address environmental and logistical challenges effectively.
SeafoodSource: Are uncertain future geopolitical challenges, including sanctions, impacting the growth and expansion of the Iranian aquaculture sector?
Mesbahi: These challenges create obstacles in accessing global markets, importing essential inputs, attracting foreign investment, and building a competitive international presence. Despite Iran’s natural advantages and growing expertise in aquaculture, these issues constrain its ability to realize its full potential.
Sanctions, particularly those imposed by the U.S., restrict Iran’s ability to trade freely on the global stage. Although seafood exports are not always directly targeted, sanctions complicate logistics, financial transactions, and access to global supply chains. Many Iranian exporters must rely on intermediaries or barter systems, which increase costs and reduce competitiveness.
Additionally, geopolitical uncertainties deter potential buyers, who may hesitate to engage in long-term trade relationships due to concerns about supply chain disruptions or reputational risks. This is especially true in premium markets such as the E.U., where strict standards and political considerations make market entry even more challenging.
The reliance on imported inputs such as feed, advanced farming equipment, and broodstock is another critical vulnerability. Sanctions and political tensions often limit access to these vital resources. This dependence reduces efficiency and affects both production volume and quality, further complicating efforts to compete with major aquaculture exporters like Ecuador and India.
Moreover, the aquaculture sector’s modernization and scaling efforts are hampered by restricted foreign investment and limited technology transfer. Without access to cutting-edge technologies such as recirculating aquaculture systems or advancements in genetic breeding, Iranian producers face challenges in achieving sustainable and efficient growth. While domestic innovation is progressing, it cannot yet fully replace the benefits of international collaboration.
These geopolitical constraints also affect Iran’s ability to diversify its export markets.
Sanctions force the country to focus heavily on less restricted markets, such as China, Russia, and neighboring countries like the U.A.E. and Iraq. These markets are valuable, but overreliance on them exposes Iran to market-specific risks, such as fluctuating demand, increased competition, or shifting trade policies. Entering higher-value markets like the E.U., which demand rigorous compliance with sustainability and food safety standards, remains difficult under current conditions.
Despite these challenges, Iran’s aquaculture sector has demonstrated resilience and adaptability. Efforts to strengthen domestic supply chains, such as developing local alternatives for feed and equipment, have helped reduce dependence on imports. The sector has also prioritized expanding exports to markets with fewer restrictions, such as China and Russia, while exploring innovative trade mechanisms like barter agreements and non-dollar payment systems.
