The recent tariff hike of 50% implemented by the U.S., after the initial six weeks of 25% tariffs, is exerting heavy strain on the shrimp industry. This abrupt increase in tariffs is causing a ripple effect throughout the entire India’s shrimp supply chain.
Ravi Kumar Yellanki, President of All India Shrimp Hatcheries Association, reveals the immediate impact of these tariffs. He explains that hatcheries are suffering most, given that farmers have halted their purchase of shrimp seed stock. Resultantly, an alarming approximate loss of ?150 crore has occurred.
Uncertainty plagues the shrimp farmers who cannot predict the future of their exports to the U.S. Due to this, their demand for seed stocks has significantly dwindled, as they tread cautiously in this unsure climate.
A single repercussion of the ongoing crisis has been the wasting away of nearly 5 billion shrimp seeds. Yellanki discloses these seeds, bearing a short lifespan of only 3 to 4 days, were not sold and hence were disposed of, leading to devastating losses.
The forthcoming festive season, including Thanksgiving, Christmas, and New Year, however, provides a glimmer of hope. Exporters are observing substantial orders, fulfilling the holiday-induced demand surge.
Indian shrimps hold a unique advantage in these troubling times – their taste. They possess a flavor profile that strongly appeals to U.S. consumers, an aspect that positions them favorably in the market, even amidst these challenges.
Indukuri Mohan Raju, the President of the Prawn Farmers Federation, offers positive news amid this crisis. He informs that assured orders are in line for their shipment until the middle of November, in preparation for the festive season burger.
The scenario quickly changed when the 50% tariffs were introduced, leading to a sharp drop in prices by ?80-100 per kg. However, it is suggested that these tariff hikes are being absorbed by American traders, who are in turn passing the burden to their customers.
Duggineni Gopinath, Co-ordinator of the Southern Coastal Districts’ Prawn Farmers Association, provides insights into the reactions of the exporters. While specifying that the situation hasn’t directly affected their operations yet, he mentions the noticeable dip in price from the exporters’ side due to the tariffs.
A meeting was held recently by shrimp farmers from four districts in Andhra Pradesh to discuss the dire situation. Their worries are considerable, as the State is a major contributor to shrimp exports, accounting for half of the total ?40,000 crore worth of shrimp exports from the country.
During this meeting, the protesting farmers called for government intervention. They appealed for the introduction of a minimum support price ranging from ?250-400 per kg for different varieties of shrimp to buffer the impact of the imposed tariffs.
The farmers also demanded that the government provide electricity at subsidized rates. They proposed a rate of ?1.50 per unit in an attempt to ease the financial strain of their operations.
In summation, the shrimp industry in India is grappling with a significant crisis following the U.S. tariff hike. While the festive season brings some relief, it is clear that a lasting solution has to be found soon to mitigate the extensive damage being inflicted on the industry.
The post US Tariff Hikes Threaten India’s Shrimp Industry appeared first on Real News Now.
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