General trends
Though China experienced a difficult year for its shrimp industry in 2004 due to the USA anti-dumpling measures on Chinese shrimp exports, relative figures show that the industry has since recovered. Increasing income of residents and strong local consumption provide a strong local market demand on shrimp. Surplus rural labor plus increasing exports of value-added shrimp products helped to mitigate the negative impact on the shrimp industry caused by the appreciation of the RMB Yuan.
Farmed shrimp production continuing growth
From 2000 to 2003, farmed marine shrimp production n China increased at an annual rate of 43% while in 2004 the production witnessed a very low growth rate of only 8.5% over 2003. In 2005, the figure hit an historical record reaching 624,000 Mt up by 16% over 2004. Preliminary figures show that marine shrimp production in China kept growing in 2006. P. Vannamei continues to be the single species dominating shrimp production in China accounting for more than 70% of total farmed shrimp production.
Prices for shrimp increased
A price index for farmed shrimps indicated that in 2006, the average price for all kinds of farmed shrimp increased up by 10-15% over 2005. However, prices for P. Vannamei witnessed a very slight increase over 2005. Guangdong is the major shrimp producing province in China. Figures from Xiashan Shrimp Wholesale Market in Guangdong, the largest shrimp transaction market in China indicates that in 2006, the average price for P. Vannamei (40pc/kg) transacted in this market is about 28.5 RMB Yuan per kg, 0.5 RMB Yuan or 1.7% more than that in 2005, but about 6 RMB Yuan more than that in 2004. Below is the price trend of the P. Vannamei (40pc/kg) by months in 2006.
Exports of value-added shrimp products increased
Figures from China Customs show that from January to November 2006, China exported a total of 241,836 Mt of shrimp and shrimp products worldwide, up by 24% over the same period of the previous year and valued at 1.19 billion US$, up by 25%. This big increase is largely due to the sharp increase in exports of value-added shrimp products which was registered at 177,276 Mt, 59% more than the previous year (see table 1 below).
Table 1: Chinese shrimp exports by product form, January-November 2006 (source: Chinese Customs)
USA once again the major market for Chinese shrimp exports
USA, EU, Japan, Korea Rep., Hong Kong, ASEAN, Mexico are the top 7 markets for Chinese shrimp exports representing more than 80% of total shrimp exports in terms of volume. The USA was once again the No.1 market for Chinese shrimp exports in 2006. In the first 11 months of 2006, China exported 51,153Mt of shrimp and shrimp products to USA, worth of US$281.86 million; both double the figures in 2005. The market of the Republic of Korea is also very dynamic representing a 50% increase in 2006 over 2005 in terms of volume.
Table 2: Chinese shrimp exports by main areas of destination, January-November 2006 (source: Chinese Customs)
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Appreciation of RMB Yuan affecting the Chinese shrimp exports
Since 21 July 2005, China has adopted a flexible policy on its currency exchange rate. So far, the RMB Yuan has appreciated 6% against US Dollar. The Chinese shrimp industry does feel some pressure from the RMB Yuan appreciation, However, surveys indicate that except for the USA market, other markets which do not transact in US dollars are less affected. Besides, experts point out that since China has abundant rural labor resources, and as the industry moves to focus more on exports of value-added shrimp products, the negative impact on the shrimp industry caused by the appreciation of RMB Yuan is somewhat mitigated.
Future development of the Chinese shrimp industry
China foreign currency reserves reached more than US$1 trillion at the end of 2006. In 2006, the Chinese foreign trade surplus hit the historical record at more than US$17 billion. To balance the foreign trade imbalance, the Chinese Government has since this year shifted its policy to reduce its trade surplus through increased domestic consumption and imports. It is envisaged that in future, shrimp exports may slow down somewhat but domestic consumption will increase. However, experts believe that in view of the size of the shrimp industry as well as the solidly established shrimp processing industry, the slowdown of Chinese exports of shrimp and shrimp products may not be by a big margin.
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