Indian shrimp exporters are anticipating a temporary lift in demand as the U.S. holiday season approaches, providing some relief from falling prices and the impact of high tariffs, industry executives said.
Companies like Avanti Feeds and Apex Frozen Foods reported that the short-term effects of the recently imposed 50% U.S. tariffs on Indian shrimp may not be as severe as initially feared. Many U.S. buyers are reportedly willing to absorb the tariffs to ensure a steady supply during peak holiday consumption periods in November and December.
“The November-December period is the holiday season in the U.S., when seafood consumption is at its peak. Retailers want to keep products on their shelves, so shipments are continuing. The short-term impact is not as large as we anticipated,” said DVS Satyanarayana, Chief Financial Officer at Avanti Feeds. The Hyderabad-based company directs nearly 48% of India’s shrimp exports to the U.S.
Avanti Feeds, India’s largest shrimp feed manufacturer, supplies feed to thousands of aquaculture farmers and operates processing plants exporting frozen shrimp mainly to the U.S., Europe, and Japan.
Indian shrimp exporters face stiff competition in the U.S. market from countries such as Ecuador, Indonesia, Thailand, Vietnam, and China. Ecuador, for instance, faces only a 10% tariff, potentially giving it a competitive advantage over India. India’s 50% tariff includes an additional 25% penalty linked to crude oil imports from Russia.
“Some U.S. customers have committed to absorb the 50% tariff for pre-holiday orders, which means the extra costs may be passed on to consumers. However, not all buyers are willing to do so; some have canceled orders or are seeking alternative sources,” said Karuturi Chowdary, Managing Director and CFO of Apex Frozen Foods.
According to Crisil, India’s frozen shrimp export volumes are expected to fall 15-18% this fiscal year, with realizations also likely to decline due to tariffs. Exporters are considering diversifying their product mix and exploring new markets to mitigate the impact.
Domestically, companies see an opportunity to boost shrimp consumption within India, which remains relatively low.
“With government support, we hope to promote domestic sales as an alternative to exports,” said Ramachandra Rao, Managing Director of Avanti Feeds.
As the U.S. holiday season approaches, Indian exporters are cautiously optimistic that demand will provide temporary relief from the challenges posed by tariffs and global competition.
