Ecuador's production, US demand key drivers of global shrimp market

Ecuador’s push to implement technology to drive efficiency while focusing on sustainable production may lead it to take the top spot in the global shrimp market as soon as this year, according to Allan Cooper, director of business and value creation at Lima, Peru-based aquafeed company Vitapro.

Speaking at the annual IFFO - The Marine Ingredients Organization Conference in Lima on 26 October, Cooper said Ecuador's wild shrimp catch has remained stagnant over the past five years. Worldwide, the harvest of wild shrimp will total around 3.25 million metric tons (MT) in 2022, trending down from the 3.49 million MT registered in 2017, while over the same time period, shrimp production from aquaculture increased from 606,000 MT in 2017 to 2.18 million MT estimated for 2022.

“Aquaculture is the future of seafood proteins, and two species – shrimp and salmon – are the backbone of it,” he said.

The shrimp industry alone saw more than USD 20 billion (EUR 20 billion) in trade value in 2021, boasting a compound annual growth rate (CAGR) of 5 percent from 2013 to 2021, closely followed by salmonid production with a CAGR of 4.8 percent over the same period.

Within the shrimp sector itself, global demand is being driven by the U.S., Cooper said. While China is still the largest market, consuming an estimated 3 million MT this year, its demand has remained flat, with a CAGR of just 1 percent from 2019 to 2022. On the other hand, the U.S. is expected to demand 1 million MT this year, with a CAGR of 10 percent during the same period. In comparison, Europe is estimated to consume 720,000 MT this year, with a CAGR of 1 percent. The rest of the world combined  consumed 3.8 million MT, a negative CAGR of 0.35 percent.

Globally, shrimp supply growth is being led by Ecuador, which experts estimate will produce nearly 1.3 million MT in 2022, with a CAGR of 23 percent from 2019 to 2022. Ecuador is followed closely by China, at an estimated 1.27 million MT, but that figure represents a CAGR decline of 3 percent over the same period. Other top-producing countries are India at 800,000 MT, with a CAGR of 5 percent; Vietnam at 600,000 MT, with a CAGR drop of 3 percent; and Thailand at 301,000 MT, with a modest CAGR of 0.1 percent.

The growth of Ecuador, Cooper said, has been sudden and remarkable.

“In 2017, Ecuador represented about 12 percent of total shrimp production in the world. Today it is about 24 to 25 percent,” Cooper said. The country saw 36 percent growth last year alone, and is slated to expand another 30 percent this year.

“Ecuador has taken the shrimp world by surprise,” Cooper said. “We’ve seen exceptional growth in the last two to three years. Very few industries have been able to grow at a pace such as Ecuador, which saw massive growth after 2020.”

The country was forced to react to a drop in 2020 prices, stemming from lower demand due to the COVID pandemic, he said. Coming out of the global health crisis, Ecuador continues to push its growth through the rapid and widescale implementation of new technology, according to Cooper.

Currently, nearly a quarter of Ecuadorian hectares are equipped with automatic feeders and aerators, up from 10 percent in 2019, according to Cooper. Since 2019, planting densities have increased from 15 per cubic meter to 18.6 per cubic meter, thanks to the implementation of a variety of technological advancements.

On a global level, shrimp farmers produced 5 million MT of shrimp in 2021, and that figure is estimated to reach to 7 million MT in 2030, Cooper said, with some of that growth coming from nontraditional markets such as Mexico and Brazil. Additionally, former shrimp players including Venezuela are making a comeback thanks to new technology.

Regarding trends in ingredients for shrimp feed, Cooper said that plant-based feed was gaining momentum. Whereas 73 percent of feed was plant-based in 2001, while fish oil represented 2 percent and fishmeal 25 percent of the total meal fed to shrimp, the share of plant-based shrimp feed used in 2020 had increased to 86 percent, while the use of fish oil decreased to 1 percent and fishmeal to 13 percent. Despite that shift, the shrimp sector is still producing more volume than 2001, Cooper said.

The shrimp aquaculture sector must put more focus on ensuring sustainable practices in the aquafeed supply chain, and in validating and making more visible the sector’s commitment in traceability technologies.

“We as an industry have to talk about the good things we’re doing,” he said. “We need to radically collaborate, how to think of a better world where feed and protein are the best for the final consumer, which will bring systemic change towards sustainability."

Photo courtesy of Christian Molinari/SeafoodSource