Bangladesh loses export market to Whiteleg shrimp
Skip to main content
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Splash
  • Features
  • Videos
  • Long Read
  • Games
  • Epaper
  • More
    • COVID-19
    • Bangladesh
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Subscribe
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
The Business Standard
FRIDAY, MAY 27, 2022
FRIDAY, MAY 27, 2022
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Splash
  • Features
  • Videos
  • Long Read
  • Games
  • Epaper
  • More
    • COVID-19
    • Bangladesh
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Subscribe
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
Bangladesh loses export market to Whiteleg shrimp

Trade

Ahsan Habib Tuhin
12 January, 2020, 09:55 am
Last modified: 12 January, 2020, 01:09 pm

Related News

  • India exported wheat worth $473 million in April
  • Pre-shipment credit refinancing relaxed to increase exports
  • India bans wheat exports in growing wave of food protectionism
  • Forex reserve falls to $41b-mark with higher imports, lower remittance inflow
  • ‘Subsidies are facilitating the concentration of exports, not diversification’

Bangladesh loses export market to Whiteleg shrimp

The continuous fall in shrimp exports and production has resulted in a plunge in the share prices of shrimp exporting companies

Ahsan Habib Tuhin
12 January, 2020, 09:55 am
Last modified: 12 January, 2020, 01:09 pm
Representational Image. Photo: Mumit M
Representational Image. Photo: Mumit M

Even though the global shrimp market has been expanding, our share in it has been shrinking as high-priced Bangladeshi shrimp lose in sales to the lower priced hybrid Whiteleg shrimp.

The country now holds on 2 percent of the global market share, down from 4 percent five years ago.

Furthermore, the export of Bangladeshi shrimp fell by about 34 percent during the period, along with over 28 percent decline in production. This continuous fall in production and export has plunged the share prices of shrimp exporting companies.

According to the Food and Agriculture Organization of the United Nations, the global demand for shrimp has been increasing. 

In 2014, the demand for shrimp was 43 lakh tonnes, which rose to 48 lakh tonnes till November last year.

Whiteleg shrimp is a low-priced but high-yielding hybrid variety. It has captured the global market occupied earlier by other varieties of shrimp and prawn – most notably the black tiger shrimp. India, Vietnam,

Thailand and some other countries have gotten huge success by farming of Whiteleg shrimp.

However, the Bangladesh government does not permit commercial farming of this variety.

"Our competitor countries are far ahead of us in exporting Whiteleg shrimp, whereas we have stuck to high-priced prawn cultivation," said Kazi Belayet Hossain, president of the Bangladesh Frozen Foods Exporters Association.

He also said about 70 to 80 organisations in this sector have closed as the global demand for Bangladeshi shrimp and prawn continue to fall.

He further said Whiteleg shrimp have captured 77 percent of the global export market, while prawn holds only 11 percent.

"At present, one pound of prawn costs $2 higher than Whiteleg shrimp. Buyers have been cutting costs due to a global economic slowdown. This has also caused the demand for Bangladeshi shrimp and prawn to fall in the global market," Belayet stated.

He said that after 20 years of persuasion, the government has allowed only exporters to cultivate Whiteleg shrimp on a test basis for one year. 

"But the exporters have no experience this. The duration is so short that the experiment may not be successful," he further said.

He added that it requires about five years to see the success in Whiteleg shrimp farming.

Shrimp export continues to fall

According to the Export Promotion Bureau (EPB), Bangladesh exported 41,236 tonnes of shrimp worth $545 million in the 2013-14 fiscal year.

Since then, shrimp export has been dropping. By the 2018-19 fiscal year, exports decreased by 34 percent to $361 million. In that fiscal year, the country exported 29,543 tonnes of shrimp.

The falling trend in shrimp export has continued in the current fiscal year too.

In the first six months of 2019-20 fiscal year, shrimp exports fell by 4 percent than the amount exported in the same period last fiscal year.

In July-December period of this fiscal year, shrimp worth $215 million was exported but the shrimp export in the same period last fiscal year was $223 million.

At present, farmers are cultivating shrimp on 275,509 hectares of land across Bangladesh.

Origins of the Whiteleg shrimp

Whiteleg shrimp was introduced in the United States in the 1970s. Commercial cultivation started to expand in the 1980s, reaching many Asian countries such as China, Thailand, Indonesia and India.

However, many Asian nations are unwilling to promote the Whiteleg shrimp farming as they fear importing exotic diseases, according to an article of the Food and Agriculture Organization.

Picture of frozen shrimp. Photo:Collected
Picture of frozen shrimp. Photo:Collected

Bangladesh Frozen Foods Exporters Association said one hectare of land in Bangladesh yields 300-400 kilogrammes of black tiger shrimp and prawn. In contrast, much larger quantities of Whiteleg shrimp can be obtained from the same area of land.

Top Bangladeshi shrimp exporters 

Apex Foods Limited, a top shrimp exporter of Bangladesh, received a gold medal as the top exporter of frozen foods in the fiscal years 2011-12 and 2013-14.

However, the company started losing business from FY14 as the demand for Bangladeshi shrimp fell in the world market. 

From FY14 to FY19, the shrimp export of the company decreased by around 55.5 percent from over Tk384 crore to over Tk171 crore.

But the company has still been giving 20 percent cash dividends to its shareholders for the last five years. 

In the first quarter (July-September) of the current fiscal year, the company's export increased by 35 percent to Tk60 crore, from Tk44.40 crore during the same period in FY19.

But as the production cost during the period shot up by 38 percent, the company's net profit dropped by 25 percent.

As a result, share price of Apex Foods in the Dhaka Stock Exchange kept falling. In May 2018, its share price reached its highest at Tk272.30. 

But last Thursday, the closing price of the company's share was only Tk119.20.

Shahriar Ahmed, managing director of Apex Foods, said, "Apex Foods had a continuous growth up to 2013-14. Thereafter, we were unable to maintain it due to decline in the international demand and price levels.

"Nevertheless, we have been trying to overcome the situation by minimising costs so that the company can run profitably and maintain sustainable growth," he added.

Gemini Sea Food Limited, another local exporter, was never able to achieve continuous growth in shrimp exports.

After 2012, its exports continuously fell for the next four years. In 2017, its export suddenly rose to Tk135 crore.

That year, it gave its shareholders a 125 percent stock dividend as its share price in the Dhaka Stock Exchange grew by 395 percent to Tk1,485 from Tk300.

After 2017, shrimp exports by the company continuously decreased.  Up to FY19, its export fell by 50.43 percent to Tk67.16 crore.

The price of Gemini Sea Food shares, too, slid continuously. On Thursday, its shares closed at Tk163.90.

Kazi Inam Ahmed, managing director of Gemini Sea Food, said, "The demand for shrimp produced in our country has decreased due to Vannamei [Whiteleg] shrimp. We are working to produce higher quality shrimp by reducing production costs."

He also said a decision has been reached to modernise their factory to improve the quality of shrimp processing. Tk30 crore will be invested for this purpose.

Economy / Top News

Shrimp / export

Comments

While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. Published comments are readers’ own views and The Business Standard does not endorse any of the readers’ comments.

Top Stories

  • All banks have to sell dollars at same rate
    All banks have to sell dollars at same rate
  • Ctg port Asia’s least efficient for container handling: World Bank
    Ctg port Asia’s least efficient for container handling: World Bank
  • Photo: Bloomberg
    Bigger food crisis can be averted if Asia remembers not to panic

MOST VIEWED

  • India to import goods from Bangladesh by rail
    India to import goods from Bangladesh by rail
  • File image
    India allows goods import from Bangladesh by rail, framework set
  • Photo: Mohammad Minhaj Uddin/TBS
    Direct container shipping to the United Kingdom starts on Friday
  • Photo: Collected
    No barrier in wheat import from India: Tipu Munshi
  • Photo: Courtesy
    Ctg Chamber president slams edible oil hoarders
  • Photo: Mohammad Minhaj Uddin/TBS
    NBR to allow more firms easy release of goods from ports

Related News

  • India exported wheat worth $473 million in April
  • Pre-shipment credit refinancing relaxed to increase exports
  • India bans wheat exports in growing wave of food protectionism
  • Forex reserve falls to $41b-mark with higher imports, lower remittance inflow
  • ‘Subsidies are facilitating the concentration of exports, not diversification’

Features

Photo caption: Business models are already being hit by climate risk. It is the function of regulators to force banks to pay attention to the future risks to businesses. Photo: Bloomberg

HSBC and its discordant climate songbook

10h | Panorama
Illustration: TBS

Should Belayets be allowed to return to school at 55?

14h | Pursuit
Impact Hub Dhaka is designed to cater to connectivity, offering lots of communal areas where you can chat over coffee, watch a webinar as a group or even host events. Photo: Courtesy

Inside Impact Hub: The surprising benefits of working in a co-working space

15h | Pursuit
Pacific Jeans uses sustainable technology in washing and finishing, and now has the facility to wash with zero water. Photo: Courtesy

How big dreams and smart investment made Pacific Jeans a denim exporting giant 

17h | Panorama

More Videos from TBS

Inflation changes lives of limited-income people

Inflation changes lives of limited-income people

3h | Videos
 Vat on locally-made mobile phones, fridges may increase prices

Vat on locally-made mobile phones, fridges may increase prices

4h | Videos
Local brands dominate country’s refrigerator market

Local brands dominate country’s refrigerator market

4h | Videos
5 latest exciting movies

5 latest exciting movies

9h | Videos

Most Read

1
Tk100 for bike, Tk2,400 for bus to cross Padma Bridge
Bangladesh

Tk100 for bike, Tk2,400 for bus to cross Padma Bridge

2
Bangladesh at risk of losing ownership of Banglar Samriddhi
Bangladesh

Bangladesh at risk of losing ownership of Banglar Samriddhi

3
Corporates go cashless…tax cut on cards
NBR

Corporates go cashless…tax cut on cards

4
Photo: Courtesy
Panorama

Misfit Technologies: A Singaporean startup rooted firmly in Bangladesh

5
BSEC launches probe against Abul Khayer Hero and allies
Stocks

BSEC launches probe against Abul Khayer Hero and allies

6
Illustration: TBS
Banking

Let taka slide

The Business Standard
Top
  • Home
  • Entertainment
  • Sports
  • About Us
  • Bangladesh
  • International
  • Privacy Policy
  • Comment Policy
  • Contact Us
  • Economy
  • Sitemap
  • RSS

Contact Us

The Business Standard

Main Office -4/A, Eskaton Garden, Dhaka- 1000

Phone: +8801847 416158 - 59

Send Opinion articles to - oped.tbs@gmail.com

For advertisement- sales@tbsnews.net

Copyright © 2022 THE BUSINESS STANDARD All rights reserved. Technical Partner: RSI Lab