Pawan Kumar G, national president of the Seafood Exporters Association of India, told businessline that the impact would be severe as India’s shrimp exports to the US stood at $2.9 billion and the country’s 40 per cent of seafood exports go to the US. The decision to impose CVD will hit both farmers and exporters and there are chances for raw material prices to go up, making Indian shrimp products less competitive vis-à-vis other competing countries.
Besides the 5.7 per cent CVD, there is an additional 1.3 per cent anti-dumping duty on Indian products and there are also chances that the anti-dumping duty may go up further. “If it happens, Indian shrimps will become most expensive in the US markets”, he said.
Ecuador is dealing with its own power cut problem due to very low rainfall this year and Ecuador is more into commodity shrimp business whose no. one market is china. US export from Ecuador is on no. 3. US is more into value added shrimp market which is supplied by India.
One more thing is that at the shelf of US marketplace , shrimp from all countries sell at same price. CVD is the extra money deposited by the company to the US government and appears as expenses in company balance sheet.
This is clearly mentioned in latest concall. The thing which I am not understanding is the difference in commentary of management of Avanti and Apex. Apex is more emphasising on improvement in shrimp demand in Q3 where as Avanti doesn’t recognise this fact.
Let see how things evolve. But one think that I have strong feeling is that next quarter results for Avanti is going to be good just like latest quarter results.
2 Likes
I am also facing the same issue, but the data seems to support Avanti management’s claim of no significant improvement in realization. I think it’s best to wait and watch for now.
Any data on Devi seafood and Devi fisheries please share in terms of processing capacity and realization?
Not invested
I don’t know from where Avanti Feeds get their shrimp price data. I was the person who asked them about this in the concall. Anyway I don’t agree with them regarding the shrimp price and I don’t expect them to be right because they won’t get direct benefit from shrimp price rise. Here is a snapshot from Kings Infra Q2 Press Release. They are also backward integrated and benefitting from shrimp price rise. Check the highlighted portion. Beleive what you want to.
Here is the shrimp price data of past few months. From July till November shrimp prices have risen by 16%… that’s huge for a backward integrated shrimp player if the price sustains.
5 Likes
I agree with the raise in the shrimp price but the reason might be diminishing supply from india also. Farmers are not able to survive at the price, which is there few months before, so they have halted the shrimp farming further and created supply issues.
Ecuador main focus is on china as they are not into the big size shrimps, india always dominates the big size shrimp market, supply issues in india also could have lead to some improvement in the prices.
Over all we may see margins improvement for all prayers, which is much needed.
2 Likes
Backward integrated players will benefit the most. Apex not being backward integrated sees margin fluctuations.
So the prices are getting adjusted to the duty raised.
Shrimp processing capacities
| Avanti |
H1FY25 |
H1FY24 |
FY24 |
Apex |
H1FY25 |
H1FY24 |
FY24 |
| Capacity in TPA |
29,000 |
29,000 |
29,000 |
Capacity in TPA |
34,240 |
34,240 |
34,240 |
| Volumes in MT |
6,206 |
5608 |
13,443 |
Volumes in MT |
5281 |
6531 |
10,949 |
| Capacity utilization |
21% |
19% |
46% |
Utilization |
15% |
19% |
32% |
| Realization in Cr./ MT |
|
|
1,082 |
Realization in Cr. |
|
|
804 |
Even Avanti has good capacity and revenue contribution from Shrimp processing…
Lets clear our doubts in upcoming concall
2 Likes
so far all discussion is about prices. what about consumption?. is it increasing or decreasing or steady. usually when prices increases consumption decreases. is this the case here as well ?
1 Like
Instead of copy pasting, please share the link to the original poster. The guy who does the hard work deserves the recognition.
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Things get priced in very quick. If you want clarity you will have to pay higher price. Be careful with cyclicals. Invest when there is uncertainty which comes with valuation comfort.
2 Likes
I am quiet conservative when it comes to investing in Shrimps will still wait until the picture gets clear.
1 Like
I’m not comfortable with catching moving trains. I’d rather buy and wait then buying after 50-60% move comes when everyone is rushing to buy. In comodity cyclicals one has margin of safety when prices crashed, there is no clarity everything is gloomy. Things look great with picture perfect clarity near top. I will not be able to exit timely if I enter late.
2 Likes
Is this good or bad for Indian shrimp exporters like apex, avanti, waterbase, kingfa?
It has been three continuous quarters where MIT has been buying Apex frozen. MIT has historically been long term investors in Indian equity. Looks promising
1 Like
