India’s seafood exports are likely to miss the $8.86 billion target set for the current fiscal due to a significant drop in demand across markets.

Though the country’s marine products exports had crossed the $4 billion mark by September this year, major markets such as the US, Europe, China, Japan are witnessing a subdued demand ahead of the Christmas and New Year season.

The emerging situation, according to industry sources, has made a dent on the business prospects in the current fiscal. They attributed the trend to factors such as inflationary pressures in global markets, Russia-Ukraine war, excess stocks both in consuming centres and producing regions, energy crisis and so on.

All these factors have led to a major decline in shipments by around 40 per cent against an encouraging trend in the first few months this year, the sources added.

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“We will be climbing down from our last year’s overall performance of $7.76 billion by about 15 per cent in view of the current situation across the markets, which were down in terms of selling,” Jagdish Fofandi, National President, Seafood Exporters Association of India told businessline.

Lower consumption in the US and Europe, high supplies from competitive markets are instrumental for the crisis. Most of the markets have been saturated due to local conditions. The country’s stock position—both on ocean catch and aquaculture—are also on the higher side and exporters are facing a financial crunch due to delayed payments, he added.

Shaji Baby John, Chairman and Managing Director of Kings Infra Ventures, said overseas shipments have been affected in three different ways.

First, the competition faced by Indian Vannamei shrimp in the US markets from Ecuador.

For a long time, the US market was stable for Indian products. However, the emergence of Ecuador as a major supplier due to its proximity to the US coast has hit Indian exports. The advantage of lower freight rates and cheaper production has given them a competitive advantage, resulting in flooding of products from Ecuador in the US markets.

Second is the rising energy prices in Europe following the Ukraine war, resulting closing down of restaurants, hitting bulk procurement.

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Lastly, China’s zero Covid policy has resulted in piling up of containers in various ports there. All these have resulted in increased stocks.

Many consuming countries are not in a position to order fresh stocks because of the closure of processing factories there, he said.

Meanwhile, Indian shrimp production has gone up with new regions coming up in inland water areas. This has put a pressure on shrimp prices, which dropped to ₹380 for 30 counts from ₹550. However, Shaji Baby John expressed the hope that this temporary phase will be over by the end of this season with demand for new stocks by early next year.