Aquaculture
Scenario Building Post COVID- 19
Indian Aquaculture is an export driven segment, with 90% of production being exported.
While the demand for aquaculture is expected to be maintained post-COVID 19; the
challenge faced by Indian aquaculture farmers will be mainly in terms of meeting the
demand with steady production. The lion’s share of Indian aquaculture comprises of
shrimp, for which both brood stocks and larval feed are imported. With the global
lockdown situation, supply of these has been stalled, which will have a significant impact
on India’s production.
This document aims to look at the challenges faced by the Indian aquaculture segment
with respect to the COVID-19 crisis; and recommend measures (immediate, mid-term and
long term), to mitigate the same.
Key Impact Factors Scenario 1 – Scenario 2 –
Lock down till end April Lock down till end May
Change in Liquidity for Minor Minor
companies
Change in Labor Challenge given the Challenge given the
availability domestic migration domestic migration
Supply of Raw Materials Major Challenge since Major Challenge since
Brooding Stock is imported Brooding Stock is imported
Logistics Major Challenge Major Challenge
Demand Domestic Minor Impact; Domestic Minor Impact;
Potential to increase exports Potential to increase
exports
1
Sector Overview
Globally, the fast-evolving aquaculture sector contributes around 50% of the total fish
production. With capture fishery production relatively static since the late 1980s,
aquaculture has been responsible for the continuing impressive growth in the supply of
fish for human consumption.
India is the second largest fish producer in the world with a total production of 13.7 million
metric tonnes in 2018-19 of which 65% was from inland fishing. Almost 50% of inland fish
production is from culture fisheries, which constitutes 6.5% of global fish production.
Shrimp comprises the majority share (75%) of India’s aquaculture share. Over the past 3
years, shrimp production in India has been growing at a CAGR of 17.4%. Thus, showing
significant growth potential.
Shrimp Production Growth
8.00 CAGR: 17.8%
7.00
6.90
6.00
5.00
5.63
2015-16
4.98
4.00
2016-17
3.00
2017-18
2.00
1.00
0.00
Shrimp Production (Lakh MT)
Source: MPEDA
Currently only 10% of the aquaculture India produces is consumed domestically. The
current per capita consumption is 6.2 Kgs which is projected to reach at 6.6 Kgs in the year
2030. While steps may be taken to increase the domestic consumption rate; it is clear that
opportunities for Indian aquaculture, especially for shrimp, will remain export driven.
Over 90% of India’s aquaculture is exported. In 2018-19, India exported 6.13 lakh MT of
shrimp. Of this, the major export countries are USA (42%), China (25%) and Europe (10%).
2
Post Covid-19 Scenario
Fish and Shrimps are aquatic living organisms
which require regular feeding and tending. Any
disruption to either of these activities will result in To maintain production, supply of
mass mortality. This will not only result in severe
quality, seed, feed and other
economic losses, but also may result in health
hazards due to decay and putrefaction. inputs is crucial.
In order to ensure continuity of the fish/shrimp
crop which has the duration between 3-6
months, uninterrupted supply of quality, seed, India imports Brood Stock, Larval
feed and other inputs need to be ensured. feed and nutrients. The supply of
these have been interrupted.
According to industry sources, hatcheries had
lost about 3.5 billion shrimp seeds immediately This, if not immediately rectified
after the lockdown while an estimated will impact production and lead
production of 5 billion shrimp was aborted. to significant price hikes.
Production challenges and Recommendations:
India currently imports the parental brood stock
of Vannamei species. Mostly Pacific Indicus is imported from Hawaii and Black Tiger
Prawns is imported from Madagascar. Given the lockdown, and the Global Pandemic,
the import of Brood stock has been put on hold and may require time to renew operations.
This will heavily impact the cyclical nature of production.
• To reduce the lag time in supply of brood stock the following immediate actions
are recommended,
Import of Brood Stock to Be Reestablished. Air Transportation of
Brood Stocks from US must be expedited. If needed special Cargo
flights should be organised for the same.
Predelivery Testing is mandatory within a span of 30 Days. However,
this won't be feasible under current situations. Thus, this criterion
may be considered to be excluded (one-time) for selected reliable
long-term suppliers. Self Declaration from such suppliers should
suffice under this emergency.
3
RGCA quarantine facility at Chennai is shut. Also its holding
capacity is not sufficient for large consignments. Thus, the brood
stock once imported should be allowed to be taken to hatcheries
directly. Thereafter sampling can be done by RGCA, and on
approval Hatchery owners can be allowed to use the Brood stock.
Additionally, the supply of larval feed and nutrients for Hatcheries need to be reworked,
as currently majority of the suppliers are from Europe. Special permits need to be worked
out to facilitate the uninterrupted supply of larval diets.
In case, steady supply of Brood Stock and larval feed is not ensured, the supply of shrimp
will be heavily impacted. This will hike up prices in both the global and domestic markets.
Recommendations to Improve domestic Consumption: While post lockdown, the
domestic demand for aqua products is not expected to be impacted; with definite
interventions domestic consumption may be accelerated.
Country wide education Build Rail-based Hub
program for consumer Strengthen cold supply infrastructure to handle
and producers on chain facility for fresh chilled products and
Antibiotic Free produce. movement, storage of transport via trains. This will
Constant vigil through Fish, Aquaculture and enable quick movement
rigorous sampling and Marine produce of fersh produce, thereby
testing at source level reducing the prices
Measures to Improve Domestic Consumption
4
Global Market Opportunities
Indian aquaculture’s major export markets are USA, Europe and China, contributing to
almost 80% of India’s shrimp exports. As per FAO data, these regions together imported
Fishery and Aquaculture products worth around EUR 37 billion as of 2018.
USA: As of 2018, US imports of Fishery and Aquaculture reached EUR17.45 billion. The US
mainly imports shrimps from India and Indonesia. Thus, India already has an advantage in
the US market for shrimp exports.
Europe: Europe’s imports of Fisheries and Aquaculture is at estimated EUR6.82 Billion.
Between 2017 and 2018, households in all EU countries, except Sweden, increased their
expenditure for fish and seafood. Thus, it is a growing market presenting huge export
opportunities.
However, the challenge faced by Indian exporters to the Europe market is of antibiotic
residue. To overcome this, India needs to invest in technological interventions in relation
to antibiotic residues, along with initiating Government to Government dialogue as
confidence building measures.
China: China’s exports of Fisheries and Aquaculture stood at EUR18.48 billion, while its
imports of EUR12.45 billion. China’s aquaculture imports are witnessing a much faster y-o-
y growth (28%) compared to its exports (1%). Until 2016, China was producing large
quantity of shrimps for their increasing domestic consumption as well as for exports.
However, since 2017, China’s production has gone down due to factors such as disease
prevalence; water stress on agriculture and conversion of aquaculture land holding to
agriculture land; and an increase in cost of labour. This opens up the market for Indian
players.
Going forward, by 2030, as per FAO the largest fish consuming regions will be Japan,
China, South East Asia and North America.
Region Per Capita Consumption (Kg/Person/year)
2020 2030 projected
Japan 63.7 62.2
China 37.8 37.8
Southeast Asia 28.3 29.6
North America 24.5 26.4
East Asia and the Pacific 26.1 23.8
Source: FAO
5
Recommendation towards Improving Export
Potential
As mentioned earlier, there exists huge opportunity for India to capture a major share of
the global market through exports. However, for this, the production needs to be
maintained through the steady supply of seed, feed and other inputs.
Short Term Recommendations
Reducing power tariffs to improve viability
Towards improving viability and competitiveness of Indian
shrimp farms, it is recommended that the power tariff be
lowered to a maximum of Rs 4.50 per unit, since power
constitutes 17% of the cost of production of shrimp.
Import Duty Exemption for Feed Additives and Supplement, Premixes
Shrimp Feed accounts for more than 55% of the operating
cost. It is recommended that feed subsidy of Rs.10/ kg of feed
should be passed to farmers through the feed mills based on
the production data of the farmer or the purchase receipt of
the farmers.
Financial Support for the Aquaculture Farming Community
Given the intensive investment and industrial scale
implement usage required in Aquaculture farming, the sector
should be given equivalent status to Micro, Small & Medium
Enterprises (MSMEs). This will also allow the credit guarantee
fund trust for MSME scheme to be applicable to aquafarmers.
6
Creation of Bridge fund, as a risk fund to be operated by NFDB
to cover the calamities like floods and market collapse
situations, or insurers can take this job and NFDB can bear the
premium on behalf of the fish farmers.
Long Term Recommendations
There should be a focus on Research and Development (R&D)
towards developing a nuclear breeding centre (NBC) for shrimp
in the country.
Clear areas need to be identified for Aquaculture and inland
fisheries with environment sustainability programs. This zoning will
help in enhancing biosecurity in operations. It will also help in
business continuity during times of disease outbreak.
End-to-end cold chain infrastructure is needed from the point of
harvest to point of retail. Port infrastructure for handling frozen
products need to be made more efficient.
Create desks of Indian trade of Aquaculture and Marine
produce in each of targeted country specific foreign consulate
offices to coordinate between the Indian trade body and
importing country trade body. It is important to note with the
passage of time the food safety regulation become stricter and
close engagement will be key to avoid any trade disruption.
