Shrimp traders fear $1 bn loss as long-term US contracts face heat

India's shrimp sector is in turmoil for the second consecutive day on Friday due to the impact of US tariffs.

- SANJEEB MUKHERJEE AND SHINE JACOB

India's shrimp sector is in turmoil for the second consecutive day on Friday due to the impact of US tariffs. Traders fear that US customers may back out of long-term contracts, leading to an estimated loss of around $1 billion. Additionally, farm-gate prices for shrimp are expected to fall by nearly 70 per kg for every 50-count batch.

Shrimp are sold based on count, with a 50-count representing 20 grams of shrimp (50 pieces per kg). Until recently, 50-count shrimp were priced around 350 per kg.

This count is common for Vannamei shrimp, the primary variety exported from India to the US.

The price drop is attributed to shrimp processors halting their purchase plans, which could severely impact growers. This is especially concerning as 70 per cent of India's shrimp production occurs during the summer months.

"Farmers are already in panic. If you consider 26 per cent tariff and if all this 26 per cent gets passed on to the farmers then it will be a huge loss because average 50-count price of Vannamei shrimps is around 350 per kg and if prices drop by 20 per cent then farmers will stand to lose anywhere around ₹60-70 per kg," Divya Kumar Gulati, chairman of Compound Livestock Feed Manufacturers Association, a body representing India's livestock sector, told Business Standard.