THE VALUE- ADDED SHRIMP- THE WAY FORWARD FOR THE INDIAN SHRIMP INDUSTRY TO SUSTAIN THE COMPETITION IN THE GLOBAL MARKET – PERSPECTIVE REVIEW
Abstract
Shrimp farming has been a huge success story for India from 2011 to 2018. With this success story, India has become the second largest farmed shrimp producer in the world after China. However, India is still facing increasing challenges in the global market with three market forces namely limited valued added processing capabilities, lack of traceability and low productivity. Most of the shrimp in India undergo basic processing and are sold to other countries for further value -added processing and reexports. The value- added shrimp products can be an innovative product like natural bonded shrimp, a new package, eco- labelling, a new cut, ready to eat, ready to cook, ready to fry, thaw and eat, heat and serve, etc with multiple formats, shapes, dimensions and flavour. There is also an increasing demand for valued added shrimp in the global markets. The value added- shrimp products are more profitable with better realization of foreign exchange earnings and high unit value. The Earnings Before Interest and Taxes (EBIT) for frozen shrimp with minimum processing is about 8%, whereas value-added processed shrimp’s EBIT margins are around 20%. India’s limited value-added processing capabilities are losing this revenue opportunity. This lost revenue opportunity limits the industry’s overall profits. India needs shift to value-added products to tap into new markets, build even stronger competitive position and become a leader in the global market. If India’s processors are ready to upgrade their processing facilities to provide value-added shrimp products in the global market, they will definitely achieve higher sales prices for shrimp. If India wants to secure shrimp Industry’s future in the global market, India requires a transformation to focus on developing an innovative business model of developing value-added processing capabilities to supply value added shrimp products to achieve improved economics and sustainability. This paper studies on value added shrimp products, the future for the Indian shrimp Industry to sustain the competition in the global market and provides a perspective review.
Keyword : Shrimp Farming, Value-added shrimp, Earnings before Interest and Taxes, Improved Economics and Sustainability.
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References
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