India’s shrimp export volumes are likely to contract by 15-18 per cent in the current fiscal following a steep increase in US import duties, taking the effective levy on Indian shrimp to 58.26 per cent from August 27, according to a report by Crisil Ratings.
The agency said the tariff shock will not only hit export volumes but also pull down realisations, with revenues projected to decline 18-20 per cent year-on-year. This comes despite a temporary spike in shipments during the first quarter as exporters rushed orders ahead of the duty hike.
In FY25, India shipped shrimp worth around USD 5 billion, with the US accounting for nearly 48 per cent of the market. The fresh duty burden—comprising a 50 per cent reciprocal tariff, a 5.77 per cent countervailing duty, and a 2.49 per cent anti-dumping duty—will make it harder for exporters to sustain business, as passing on the additional costs to buyers is not viable.
Operating profit margins are expected to shrink by 150-200 basis points, sliding to a decade-low of 5.0-5.5 per cent due to lower capacity utilisation, weaker sales of value-added and large shrimps, and the overall tariff impact. Crisil’s analysis of 63 rated shrimp exporters—representing about 55 per cent of the industry’s revenue—indicates rising stress on debt protection metrics and credit profiles.
The US has long been India’s largest shrimp export destination due to repeat demand and higher profitability, but the latest duties place Indian exporters at a sharp competitive disadvantage compared to rivals such as Ecuador, Vietnam, Indonesia, and Thailand, who face far lower levies.