Marine exports drop 19% on US slowdown

The country's seafood exports will be the worst hit due to the recent slowdown in the US economy.

During the first seven months of the current financial year (April-October), the country's seafood exports plummeted by 19.64 per cent in volume and 14.21 per cent in rupee terms.

The exports declined by 65,580 tonnes to 268,254 tonnes, while in value term it dropped by Rs 709 crore to Rs 4280 crore.

Most of the exporters said that there had been a steep fall in their export earnings during last the seven-nine months, thanks to the appreciation of rupee against the dollar.

The average price realisation of seafood items, especially of the Black Tiger shrimp, has dropped drastically in the last three years.

While the average prices of 16-20 grade (1 Kg has 16-20 shrimps) of Black Tiger dropped to Rs 399 a kg from Rs 495 in 2005-06, the prices of 41-50 grade dropped to Rs 235 from Rs 318. In 21-25 category, the prices crashed to Rs 360 from Rs 450 in 2005-06.

Apart from the slowdown in the US economy, steep competition from Vannamei shrimp exporters in countries such as China, Vietnam and Thailand have also hit Indian exports.

Because of the tough market conditions, an appreciating rupee and poor exports demand, the number of exporters to the US has dropped to 80 in 2006-07 from 179 in 2001-02.

Increase in the cost of power and sea freight rates have further added to the woes of the industry. In 2005-06, the average per kg freight rate was Rs 14.5, which peaked to Rs 17.5 in 2007-08. Likewise, the average cost on power has increased to Rs 5.27 from Rs 4.97 a Kg in 2006-07.