May 19, 2011

Bangladeshi aquaculture sales to surpass US$1 billion

US approval for shrimp and white fish imports from Bangladesh may help to double the South Asian country's aquaculture exports to as much as US$1 billion over the next year.

Bangladesh exported US$437.4 million worth of frozen food including shrimps and white fish in the fiscal year to June 30 of 2010, and US$511 million has been exported during the first 10 months of the present fiscal year, according to the Bangladesh Frozen Food Exporters Association (BFFEA).

"By our data, we have achieved a 58% growth over last fiscal year's exports during the same corresponding period," association executive director Md Abul Bashar said.  A third of this amount went to the US, with another "50% going to the EU countries and the remainder to Russia and the Middle Eastern nations".

This year's high growth marks a solid recovery for the industry after exports slumped for the first time in 2009 amid the global recession, dipping to US$454.53 million in the year to June 2009, down from US$534.07 million in the previous 12 months.

Adding to the industry's misery, the American Federation of Labor and Congress Industrial Organization complained to the US Trade Representative that Bangladesh's shrimp industry did not comply with the US body's labour standards, including total elimination of child laboyr. It wanted the US government to scrap a limited duty-free access facility to Bangladeshi shrimps.

That threat now appears to have passed. Reports of three US teams who visited the Bangladeshi shrimp industry over the past two years have given the sector the all-clear, according to an April 21 Financial Express report citing Syed Mahmudul Huq, chairman of the Bangladesh Shrimp and Fish Foundation.

He said the country's shrimp industry has eliminated child labor completely and that, in a bid to maintain global standards, top exporters like Meenhar Sea Food, Atlas, National, Rupsha Fish, Fresh Food, Sobi Sea Food and others have upgraded their processing and freezing facilities and are providing training to workers and shrimp farmers so that they can implement global standards strictly.

The recovery has been helped by reinstatement of fresh water shrimp (FWS) exports to the EU in May 2009 after a voluntary six-month ban following allegations from Belgium that an unacceptable proportion of the antibiotic nitrofuran was present in shrimp processed for EU consumers. The allegations led to a loss of around US$83.3 million, according to exporters.

"The US allegations followed right after this," Kazi Shahnewaz, chairman and managing director of the Shahnewaz Group and president of BFFEA, said.

BFFEA's executive director Bashar said, "The government of Bangladesh extended their support by asking the Irish scientist Dr Glenn Kennedy to investigate the European allegations in early 2009. His study revealed lower concentration of semicurbazide (SEM) in the inner portion of FWS meat, suggesting that diffusion of SEM occurred from the shell through the tail meat, rendering the allegations, which implied that harmful antibiotic like nitrofuran is present only in Bangladeshi shrimps, baseless."

Although exports resumed, EU recommendations meant exports from Bangladesh still had to undergo "stringent testing measures".

Some of these tests are likely to be withdrawn this year as an EU Food and Veterinary Office team's draft report cited the monitoring of system "improvements" after a visit to shrimp plants in late March. It also pointed that "the analytical methods used for the residue monitoring programme in crustaceans and for the pre-export testing are now validated and fit for purpose."

The list of recommendations decreased to four, down from 12 in 2010. The Department of Fisheries and Livestock in Bangladesh is confident these four recommendations will be met as well, leading the EU to drop its stringent testing measures.

BFFEA members also hope that the Bangladeshi government's decision to provide cash support on the actual rate of invoice value, to be effective from July 1 of this year, will help the exporting sector. Earlier, exporters received cash incentives based on the quantity of frozen fish exported every year.

"This will help us reach an annual frozen fish export revenue of US$1 billion as local exporters will try to seek maximum value of their products while also eliminating low-value export and dumping," said Shahnewaz.

"We are getting good prices for shrimps and white fish, this year," mentioned Bashar, who added that new destinations for exports are opening up in Eastern Europe, Mauritius, and Australia. "We are also receiving plenty of orders from Japan and Egypt," said Shahnewaz.