August 24, 2016

A painful reinvention for the world shrimp market

An eFeedLink Hot Topic
  • A new wave of outbreaks has flattened world output 15% below peak levels achieved five years ago
  • China, Thailand are growing 30% to 50% less shrimp than before. Vietnam sustains production by using costly, less exportable tiger shrimp. India, Ecuador can't push output higher without encountering serious problems
  • Rather than a straight "host-pathogen" relationship, today's shrimp diseases capitalize on non-linear, highly conditional relationships between pathogens, water quality, feed materials, larvae genetics and other microbes.
  • Stakeholders must make painful changes in how they raise shrimp, manage farms and facilities
  • A new shrimp farming paradigm will emerge, enabling output rise 40% above today's levels by 2025
Shrimp, which once led aquaculture's ascendancy, is now the leading causative factor in its stagnation. A decade long boom has ended and producers find themselves in a caught between hard natural limits on one side and food safety concerns on the other.

It was not always like this: World farmed shrimp output increased at a 4.8% annual rate in the five years encompassing 2006 through 2011 inclusive, when it peaked at 4.15 million tonnes. The years since 2011 have been another story, with global output falling at 2.7% annual rate over the last five years. Production bottomed out 18% below peak output levels in 2013. Then with a new round of EMS, EHP and other diseases breaking out in emerging producer countries, 2014's 6.6% output recovery has been aborted, with output falling back into the 3.50 to 3.55 million tonne range in both 2015 and 2016.
Weak as it is, this recovery's sustainability over the short term is at best, shaky. 2014's production surge and subsequent fallback are symptomatic of what industry stakeholders are calling "false recoveries."
Vietnam for example, took advantage of record high world shrimp prices to boost production of white leg shrimp 12%, from 250,000 tonnes in 2013 to 280,000 tonnes in 2014 -before a new round of EMS and EHP outbreaks caused 2015 whie leg shrimp production to plunge 21%, back to 220,000 tonnes -and well below its 2010 peak of 330,000 tonnes.
At this time, overall Vietnamese shrimp production is being sustained by costlier, less exportable tiger shrimp. The latter's proportion of Vietnamese farmed shrimp output has increased from 10% in 2009 to approximately 60% today --which is one reason why Vietnam remains a large importer of white leg shrimp from Ecuador.
Similar attempts to boost stocking densities and output were followed by outbreaks and huge production falls in a large number of countries including India, Mexico and Ecuador, where producers scaled back production before outbreaks became uncontrollable. Similarly, China's output remains stuck one-third below its late 2000s peak, with industry observers noting that while much production is now occurring in new regions; areas that previously suffered EMS or EHP outbreaks remain unproductive.

Before 2015, all post-2010 increases in production came from new, frontier production regions such as India, Ecuador and Indonesia. This however, is no longer true: Ecuadorian output is levelling off slightly below 350,000 tonnes. Poor monsoon conditions in India, drought in Indonesia and emerging disease problems have held back stocking densities in both of these countries.
Thus, alongside incremental increases in the rest of the world, a 50,000 tonne increase in Thai production (which remains 53% or 340,000 tonnes below peak levels) are offsetting cutbacks or the levelling off of previously anticipated higher production increases in Ecuador, India and Southeast Asia. As a result, 2016's world shrimp output remains nearly 15% below peak levels achieved in 2010-11.
Although 2015 saw outbreaks or near-outbreaks of EMS, EHP and WSSV spreading to India, Mexico, Vietnam and Ecuador, Asia Pacific still accounts for the entire output drop in world production: At The Aquaculture Roundtable Series (TARS 2016) conference recently held in Phuket, Thailand, Robins P. McIntosh, CP's senior vice president for aquaculture production technology noted that from a peak of 3.2 million tonnes prior to the onset of EMS, Asian shrimp production fell 31.3%, to 2.2 million tonnes in 2015.
Output in the rest of the world increased by less than half the volume of Asia Pacific's production decline. Within Asia itself, China and Thailand each account for about 40% of this million tonne production decline, with Southeast Asian countries such as Vietnam and India making up the other 20% of losses.
On one hand, leading exporters cannot push pond stocking densities and output to yesteryear's peak levels without outbreaks appearing -or laws being broken. This is economically burdensome, with massive productivity losses causing decades of hard won, incremental efficiency improvements disappearing overnight. For example, McIntosh states that in Thailand, shrimp farm productivity fell from 10.6 tonnes/ha in 2010 to 4.3tonnes/ha in 2013, and continues to languish below 5.0 tonnes/ha today.
On the other hand, for countries like India and Vietnam, attempts to boost productivity and output resulted in shipments being rejected by US or EU customs officers, who cited alarmingly high antibiotic levels.
For example, India quadrupled production from a mere 100,000 tonnes in 2009 to 400,000 tonnes in 2014, taking large world shrimp market shares once occupied by China and Thailand in the process. Even so, 2015 saw EHP, white spot syndrome virus (WSSV), white faeces syndrome (WFS) and running mortality syndrome (RMS) upset the industry best laid plans. Last year, these diseases transform India's anticipated 20%, +80,000 tonne output increase (to 480,000 tonnes) into a 10%, 40,000 tonne production decline (to 360,000 tonnes).
 -With the world market having anticipated 120,000 more tonnes of Indian shrimp than what was actually grown, both importers and Indian shrimp growers were badly affected. Moreover, even to keep Indian production at current, below peak levels, the number of Indian shrimp shipments rejected by US customs due to their high antibiotic levels has multiplied over the past year.
India is not alone in having more shipments rejected in the first seven months of this year for high antibiotic levels than during entire previous years combined. According to the US based Southern Shrimp Alliance, since the star of 2016, shrimp from Vietnam, Canada, China and Thailand have all been rejected in mass volumes by major importing nations including Canada, Britain, Belgium, Germany, the United States and Australia. Substances that caused shrimp shipments to be rejected by these nations included high levels of doxycycline, oxytetracycline, tetracycline, nitro furans, fluoroquinolones, enrofloxacin, chloramphenicol, sulfadiazine, ciprofloxacin,
All this brings us to the most vexing part of the shrimp industry's dilemma: Without using banned or dangerously high levels of antibiotics, mature, established shrimp exporting regions must reduce stocking densities (and production) by 30% to 50%. From China to Ecuador, output has only been sustained by brining untouched, frontier regions into production. Of course, with such new areas dwindling in number, this strategy is unsustainable.
Ironically, the pathogens which cause these diseases have always been present in shrimp ponds, but only turned lethal under modern shrimp culturing conditions. Unlike previous outbreaks, these diseases are not caused by the pathogens acting on its own. A critical accumulation of pond waste, poor genetics (due to the cost-saving inbreeding of PL stock), the elimination of the pathogen's natural predators and boosting of bacteria above a critical, minimal concentration must all coincide before the EMS causing microbe becomes lethal.
Noting that the bacteria that EMS causing bacteria live off, "shrimp feed, molted shells and sludge," McIntosh notes that the industry's current recourse to antibiotics treats symptoms, rather than EMS's foundational causes. He concluded that "We must redesign our shrimp culturing systems to keep [EMS causing] bacteria below Quorum levels."
This is the reason why EMS was lethal in China and Thailand but it did not harm shrimp in Bangladesh, which has far lower stocking densities and thus, fewer pond waste issues. Similarly, EMS did very little harm to Mexican shrimp when it was first detected -but turned deadly when stocking densities were increased. We also know that while high stocking densities create such preconditions, in China and Thailand, in-breeding of PL grow-out stock (rather than buying new broodstock) weakened shrimp immunity to the disease.
Moreover, through means such as pond waste flushing and monitoring broodstock quality, McIntosh reports that Thailand is getting EMS under control while employing stocking densities far higher than those found in Mexico or Bangladesh. He shared that to keep EMS causing bacteria below levels where disastrous outbreaks occur, CP has developed a pond flushing mechanism that rapidly removes shrimp sludge, feed waste and molts; adding that "It literally works like a toilet."
McIntosh's solution is given credence by Anwar Hasan, BIOMIN's Southeast Asia technical manager for aquaculture. According to Hasan, to recover from a late 2000s IMNV epidemic that caused Indonesian output to fall 56% drop in white leg shrimp harvests, Indonesian shrimp farms introduced periodic sludge flushing alongside closed water systems (to prevent contamination) and broodstock quality monitoring (to ensure good genetics). Indonesia now stands out as the only major Southeast Asian producer to not have suffered catastrophic EMS outbreaks.
Nevertheless, McIntosh warns that there is was no clear predictable, association between host and pathogen, no 'silver bullet' solution -pond flushing included. Indonesia's ability to avoid EMS for example, is due to the fact that unlike the rest of Southeast Asia, Indonesia's Indian Ocean waters are free of shewanella, a marine bacteria species scientifically proven to "activate" the lethal effects of EMS bacteria.
And this points to the real challenge facing shrimp growers: EMS, EHP, WSSV are not straight pathogen-host-antibiotic cure type maladies: The actualization of these shrimp diseases requires a wide array of coinciding, complicated, non-linear, highly conditional relationships between pathogens, water quality, physical conditions, feed materials, larvae genetics and even the presence (or absence) of certain other microbes.
For example, McIntosh notes that, "you can have white faeces syndrome (WFS) without EHP but you can't have EHP… without white faeces present." Similarly, "The mixing of VPA with WSSV produces a far higher mortality than WSSV alone, "but how many farmers merely report WSSV and are unaware of the VPA's role in jacking up the mortality rate? Get VPA under control and you are halfway to managing WSSV."
Ung Eng Huan, Biovalence Sdn's Chief Technology Officer provides perhaps the oddest example of how modern shrimp culturing systems create the very conditions which lead to these disease outbreaks. According to Ung, in nature, ubiquitous EMS causing microbes are disabled by naturally occurring bacterial strains. Unfortunately, in modern shrimp ponds, the population of EMS preventing bacteria has been artificially depressed by floc systems -which oddly enough, are designed to optimize pond water flora!
The implication is clear: All over the world, shrimp stocking densities have reached a peculiar, critical point where the technologies that boost productivity create the preconditions necessary for outbreaks to occur. Therefore, if shrimp rearing farms can be redesigned in a manner that does not create coincident preconditions for these diseases, these pathogens will revert to being harmless background microbes.
McIntosh notes that much like today, the 1990s saw six straight years of flat world shrimp output before new technologies such as biosecurity measures and new, more disease resistant breeds enabled output to achieve new peaks in the 2000s. He predicts that once shrimp farms are redesigned to prevent disease outbreaks, stocking densities -and production -will reach new heights, eventually growing by 40%, from today's 3.55 million tonnes to 5.0 million by 2025.
Unfortunately, the industry is only starting to painfully reinvent the way it manages everything from broodstock genetics to feed quality, the removal of waste and even existing bacterial control systems. Thus, while a new boom is as inevitable as the sun rising, for now, the world shrimp sector faces another dark year or two.

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