November 8, 2008
Thailand may cut shrimp output and exports in 2009
Lower shrimp prices and expected sluggish overseas demand could force Thailand's shrimp producers to reduce export volume, and cut production by 10-20 percent, according to an industry expert.
Importers are likely to keep less stocks in face of a poor economy, which could lead to lower shrimp prices, especially if the Thai industry sticks to its original 2009 output target of 500,000 tonnes, said Somsak Paneetatyasai, president of the Thai Shrimp Association.
Next year's output may be reduced 20 percent at maximum and export volume should not exceed 350,000 tonnes, 50,000-tonnes lower than this year's estimate, Somsak said.
The cuts are to prevent further falls in shrimp prices, which have declined steadily this year. The price is THB 115 per kg, down 15 percent on-year.
"If the market improves, farmers will be able to build up supplies quickly as the harvesting period of shrimp is only four months," Somsak said.
Thai Frozen Foods Association president Poj Aramwattananont said shrimp exports to key markets such as the US, Japan and the EU had grown only 3.11 percent on-year to US$1.4 billion in the first eight months of 2008.
Next year's orders may continue to decline due to the ongoing global financial crisis, according to Poj, adding that some buyers have bargained hard for lower prices and longer payment periods.