Thai Union rolls out shrimp price guarantee scheme
As a means to prevent a possible shortage in shrimp output, Thai Union Frozen Products (TUF) has launched a shrimp price guarantee scheme, company representatives announced on 16 September.
Farmers have been hesitant to begin the next investment round what with domestic prices on the downturn, observed Rittirong Boonmechote, president of TUF’s global shrimp business. "Without a guarantee, this could negatively affect the industry in the next 3-4 months,” said Boonmechote to The Nation.
“This impact would be felt domestically and internationally, as shrimp is one of Thailand’s top export items," Boonmechote added.
The scheme is slated to run until March 2016, and will result in TUF buying 12,000 metric tons (MT) of shrimp at the guaranteed rate of THB 150 (USD 4.17; EUR 3.70) per kilogram. By way of the scheme, farmers can sell their shrimp products to other buyers if market prices rise to exceed the guaranteed price.
During the first eight months of 2015, shrimp output from Thailand amounted to 135,057 MT, an 18 percent increase over the same timeframe in 2014. As a result of the price guarantee scheme, TUF expects the shrimp output for all of 2015 to increase 20 percent over last year, to total 250,000 MT.