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Top 10 Species: Farmed shrimp
Demand for imported vannamei grows unabated
By Rick Ramseyer
May 01, 2007
When Americans buy shrimp in a restaurant or supermarket
nowadays, there's an increasingly good chance it's white shrimp
cultivated beyond U.S. borders. And though sales of farmed
black tigers and wild shrimp remains significant, it's clear
that farmed Pacific whites, Penaeus vannemei , have become the
Indeed, P. vannamei now accounts for roughly 60 percent of
farmed-shrimp production worldwide, compared with around 25
percent for black tigers ( P. monodon ) and 12 percent for
freshwater prawns ( Macrobrachium rosenbergii ).
"And white shrimp is projected to be almost 70 percent of
production by the end of this year," says William R. More, VP
and director of the Aquaculture Certification Council in
Kirkland, Wash. "That's versus about 43 percent in 2004."
That explosive growth stems from places like Thailand, the
leading exporter of farmed shrimp to the United States, which
has shifted production from black tigers to vannamei.
Why? White shrimp, though generally smaller than tigers,
cost less to feed, are more resistant to disease, have higher
survival rates, tolerate higher stocking densities and they
"When you add all these things up, the risk of farming white
shrimp is a lot less than that of farming other species," More
says. "And [producers] can get multiple crops of vannamei per
year, whereas with tigers they only raise one crop."
In turn, he adds, major shrimp purchasers such as Red
Lobster and Wal-Mart have gone to farmed whites because they're
cheaper than other shrimp species and are more readily
available in large amounts.
"If you look at menus, you don't see near as many black
tigers anymore," More says. "A good example is Red Lobster;
most of what you see on the menu is white shrimp."
Fishery Products International in Danvers, Mass., an
importer and processor, brings in about 30 million pounds of
shrimp a year, the bulk of it from Asia.
"The economics are such that the Asian farmers are doing
much better raising vannamei," says Mark Leslie, FPI's
For example, Thai Union Feedmill in Samutsakron, Thailand, a
subsidiary of Thai Union International of San Diego, has
partnered with a shrimp-broodstock provider in Hawaii to
broaden its shrimp-farming and exporting businesses. The $11
million joint venture is already producing pathogen-free
Pacific white shrimp broodstock.
"Being able to come up with a strain of vannamei that grows
a little faster, that has a better survival, that's all big
money," Leslie says.
Choice Canning, a shrimp producer and importer in Edison,
N.J., and a subsidiary of India-based Choice Trading Corp., is
another player that handles an ever-increasing amount of
vannemei from Asia.
"It used to be 21-25 headless shrimp was the largest
vannemei you could find," says Thomas Jacob, senior VP for the
company, which makes the Tastee Choice line of shrimp products
and frozen Asian and Italian skillet meals. "Now, 16-20
headless and 21-25 cooked tail-on vannemei are coming out of
Though the majority of U.S.-bound Pacific whites hail from
Asia, other key shrimp-production countries are Ecuador and
Ocean Garden Products in San Diego, the primary importer of
Mexico-cultivated Pacific whites, is best known as a
foodservice company, supplying restaurants coast to coast. But
it has a retail hit with frozen, 1-pound bags of farmed Pacific
whites sold under the Pride of Mexico brand.
Available since late 2005, the bags come in two varieties -
peeled, deveined, tail-on 26-30s and shell-on 21-25s. Pride of
Mexico is sold in upscale grocers, including Whole Foods Market
stores in New England and the Northwest, as well as Uwajimaya
locations in Washington and Oregon.
Ocean Garden also sells plenty of wild shrimp, albeit that
percentage is changing. For the 2001-02 season, farmed Pacific
whites represented 40 percent of Ocean Garden's shrimp sales.
For 2006-07, it's 60 percent.
"Our focus is on increasing our supply of Mexican shrimp,"
says John Filose, the company's VP of sales and marketing. "The
wild fishery [in Mexico] is stable, so that increase has to
come from aquaculture."
Black tigers still have a place at the table, of course.
They're generally larger than Pacific whites and, given the
plethora of vannamei, are fetching higher prices for producers
in countries such as Vietnam, India and Bangladesh.
"Most of the farmed [we use] is the vannamei," says Davy
Lam, president of Tai Foong USA in Seattle, the maker of the
Royal Asia and Northern Chef brands. "But monodon are still
active on the bigger sizes."
Tai Foong sources shrimp from Asia and Latin America,
primarily serving retail customers like Wegmans, Costco and
Whole Foods, plus private-label accounts.
In late March, the wholesale prices for black tigers from
Asia were holding steady at $9.95 to $10.05 for U12s, $6.90 to
$7 for U15s, $5.85 to $5.95 for 16-20s, $5.30 to $5.40 for
21-25s and $4.75 to $4.85 for 26-30s, according to Urner Barry
Publications in Toms River, N.J.
Conversely, Pacific whites from Asia and Latin American were
fetching just $2.40 to $2.50 a pound for 41-50s, the benchmark
Two years ago, in response to an antidumping petition filed
by a group representing Gulf shrimp fishermen and processors,
the U.S. government slapped tariffs on importers from India,
Thailand, China, Vietnam, Ecuador and Brazil.
But tariffs aren't the only complication altering the global
shrimp industry. Under a policy that U.S. Customs and Border
Protection began enforcing in 2005, importers must post
continuous bonds to help prevent tariff evasion. Continuous
bonds are calculated by multiplying the value of a seafood
company's imported product from the previous year by the amount
of the tariff. Thus, if a company imported $30 million of
shrimp subject to a 10 percent tariff in 2005, it would post a
$3 million bond in 2006.
In February, a World Trade Organization panel ruled that
U.S. antidumping tariffs on Ecuadoran shrimp violate
international trade law. The panel said the DOC inflated the
tariffs using a controversial methodology called "zeroing,"
which assigns a value of zero to export prices that exceed
normal values, instead of a negative number. That effectively
increases the difference between export prices and local prices
when averaged out over time. (The DOC agreed to discontinue the
use of zeroing in early 2006 after the WTO deemed it
The WTO's dispute-settlement body is expected to take up
Ecuador's case. Thailand and India have also filed petitions
with the WTO claiming the DOC inflated its shrimp tariffs using
zeroing, with a decision expected soon.
Not surprisingly, some industry representatives remain none
too pleased by trade restrictions.
"What I find most appalling is the arbitrary nature of the
bonding," says Eric Bloom, president of Eastern Fish Co. in
Teaneck, N.J., which sources shrimp - the vast majority Pacific
whites - from Asia and Latin America. "Companies with a 30-,
40-, 50-year history, if they want to do imports they'll have
to post the bond, as if they're ready to go out of
FPI, meanwhile, like other seafood companies, has migrated
more business toward countries that are either tariff-free, or
works with suppliers that deliver duty paid (DDP).
"We were a large player in Vietnam for both our U.S. market
and our Canadian market," Leslie says. "Now, we haven't bought
a load of Vietnamese [shrimp] for the U.S. market in I don't
know how long."
Moreover, it's no secret that some tariff countries are
cooking the shrimp and converting it to other forms that have
"Pre-tariffs, we bought large volumes of peeled shrimp, raw
IQF; now we buy large volumes of pre-dusted butterfly and small
peel from China," Leslie says. "So we had to modify our whole
process to maintain the supply source, but bring it in without
getting hit with tariffs."
Creating value-added shrimp also is a growing trend. "People
seem to be pushing more toward marinated shrimp and shrimp
skewers," says Bloom of Eastern Fish. "Those markets are
gaining some inroads."
Still, the U.S. market "has a long way to go to create a
brand for shrimp [that resonates with consumers]," says Lam of
Tai Foong. "Private labels don't help consumers to recognize
any national brand out there.
"The market has been fragmented for years, so it's going to
be a challenge for any value-added products," he adds. "But
it's something everybody's trying to pursue."
At FPI, the value-added lineup includes shrimp sold under
the Margaritaville retail brand in several sizes and in six
varieties: Calypso Coconut, Island Lime, Jammin' Jerk, Paradise
Cocktail Shrimp, Sunset Shrimp Scampi and Surfside Shrimp
"A major growth area, and challenge, is the shift of
value-adding overseas," Leslie says. "The overseas suppliers
see where the margins are, so you're seeing a lot of people
getting involved in the shrimp value-added business."
Nevertheless, given shrimp's status as America's favorite
seafood, with per-capita consumption topping 4 pounds, "the
general consumer is still very comfortable, particularly at
retail, buying shrimp in a bag out of a case and preparing it
themselves," Bloom says. "Or buying the precooked cocktail
With 85 percent of the U.S. shrimp supply now stemming from
imports, and global production of aquaculture shrimp in 2006 of
2.8 million metric tons - a 12 percent increase over 2005 -
it's little wonder that certification, including traceability,
is growing in significance.
"Environmental sustainability is probably the biggest issue
right now," says More of the Aquaculture Certification Council.
"It's a focal point for most buyers, certainly driven by
consumers. It gives buyers assurance about a more wholesome
product produced under environmental responsibility
As part of those efforts, Wal-Mart and Darden Restaurants,
collectively representing more than 5,200 U.S. stores and
restaurants, are requiring shrimp farmers to adhere to the Best
Aquaculture Practices. These standards were developed by the
Global Aquaculture Alliance and are enforced by the ACC to
ensure shrimp is farmed and processed in an environmentally and
socially responsible manner.
Since its inception in 2003, ACC has certified 260,000
metric tons of product in 54 processing plants, as well as
about 25,000 metric tons of farmed product from 38 farms in the
Western Hemisphere, More says.
Seafood safety also remains top of mind.
"The average consumer may be aware of sustainability, but I
don't think it's their primary concern," says Bloom. "They want
a healthy, safe product."
As shrimp imports continue to rise - shipments in 2006 to
the United States exceeded 1.3 billion pounds, up from 1.16
billion pounds the previous year - more countries like
Bangladesh are ramping up production.
"These developing nations recognize the opportunity: Shrimp
is easy to prepare, it's a desired seafood, and most people can
relate to it," says Bloom of Eastern Fish. "So I see
consumption growing with the increased supply."
Filose of Ocean Garden agrees. "A double-digit supply
increase to a mature market is substantial," he says. "The
price of shrimp right now is one heck of a value for any
retailer or restaurateur. If you have good supply and fair
prices, it's a good time to be in the shrimp industry."
Contributing Editor Rick Ramseyer lives in Cumberland,