Indonesia's CP Prima races to restore shrimp output

The world's largest shrimp producer, PT Central Proteinaprima (CP Prima), is working to overhaul its production processes after output was affected by the spread of a highly-infectious virus and sales were hit by a trade spat with the US last year.

''We have taken gradual steps toward a recovery in shrimp production amid our multi-dimensional problems, including implementing prudent management in all aspects of the operations,'' said Erwin Sutanto, CP Prima's president director.

Erwin said the company was focused on limiting the spread of the infectious myonecrosis (IMN) virus, which has devastated the company's shrimp production. Total harvest volumes plunged from 8,486 tonnes in January to 3,536 tonnes in September. Production at the company's main Central Pertiwibahari (CPB) farm dried up almost completely -- from 5,728 tonnes in January to below 433 tonnes in September.

The company's revenue declined by 14% to Rp5.2 trillion (US$551 million) in the nine months to September, while net profit tumbled by 80% to Rp24 billion (US$2.52 million).

Profit plummeted on lower sales volumes, especially after sales to the key market in the US were halted in January because of allegations that the company had illegally transshipped shrimp from China.

Export volumes of the company's mainstay, frozen shrimp products, dropped from 12,800 tonnes in the first quarter to only 7,300 tonnes in the second quarter before increasing slightly to 7,565 tonnes in the third quarter.

The US began admitting CP Prima shrimp again in mid-year after government representatives intervened on behalf of the company in April.

Profit margins were also affected by the weakening of the US dollar, which dropped from about Rp12,000 (US$1.26) in the middle of the year to Rp9,500 (US$1.00) this week, as concerns about the health of the US economy grew.

Erwin said CP Prima continued to suffer from net cash outflows in the third quarter, primarily due to lower production at its CPB farm and farmers' impaired ability to pay for feed and fry because of reduced pond yields.