December 23, 2014

Thai shrimp industry recovers but faces much higher EU tariff for exports

Thailand's shrimp industry, hobbled by the Early Mortality Syndrome (EMS) epidemic, is on its way to recovery with modest increases in production and export volumes expected in 2015, the Thai Shrimp Association (TSA) said.

The TSA forecast that shrimp production would recover to 250,000-300,000 tonnes next year and exports to 180,000-200,000 tonnes worth THB75 billion-THB85 billion (US$ 2.28 billion), according to a Bangkok Post news report.

Somsak Paneetatyasai, TSA president, said total shrimp production this year is expected to reach only 230,000 tonnes due to EMS, with expected export volume at only 150,000 to 160,000 tonnes worth about THB60 billion (US$ 1.82 billion).

During the first 10 months of the year, Thailand exported 130,000 tonnes-down by 26% year on year-valued at THB51 billion (US$ 1,55 billion), down by 8%, the newspaper said.

It said that before EMS struck Thailand in mid-2012, the country produced as much as 500,000 to 600,000 tonnes of shrimp annually.

Somsak said that as the EMS epidemic eases, the industry faces another challenge with the termination of the EU tax privileges under the Generalised System of Preferences on January 1, when the EU tariff on Thai shrimp triples to 12%.

Somsak said this would weaken Thai shrimps' competitiveness, and urged the government to accelerate free trade talks with the EU.

He also suggested that the government tackle the human trafficking issue.

"We've explained that the shrimp industry has nothing to do with forced or child labour, as shrimp production is farm-based," Somsak was quoted as saying by the Bangkok Post.

Thailand was downgraded in June to Tier 3 from Tier 2 by the US State Department for not fully complying with the minimum standards for the elimination of human trafficking. It joined Syria, Iran, North Korea and 17 other nations.