Domestic appetite for seafood waned as the pandemic-induced lockdown weakened demand from hotels, restaurants and cafes
Subdued demand in both domestic and export markets will shave 25-30 per cent of the revenue of small and medium enterprises (SMEs), which account for nearly 80 per cent of the seafood industry in India, in the current fiscal year (FY21).
Domestic appetite for seafood waned as the pandemic-induced lockdown weakened demand from hotels, restaurants and cafes. Households also cut down on seafood consumption on fears of transmission of the disease.
Export demand, on its part, plunged as the top 15 severely impacted Covid-19 countries — including the US, Russia, Italy, Spain and the UK — account for about 65 per cent of India’s seafood export basket.
That said, the industry is projected to rebound in the next fiscal year (FY22), with about 12 per cent growth in revenue, led by recovery in demand. Though exports are also expected to see an uptick, increasing competition from Ecuador, Vietnam and Thailand is likely to cap export growth.
Over the medium-to-long term, fish production in India will improve largely on account of increase in overall aquaculture production.
In FY20, aquaculture products comprised 70-75 per cent of the country’s overall seafood exports. The size of the export market for shrimps alone was $4.5 billion, with white leg shrimps accounting for a 75-80 per cent share.
Exporters typically earn higher margins than domestic players. However, the rising global supply of shrimp has exerted downward pressure on prices, paring export realisations.
Meanwhile, the government is looking to ensure sustainable growth of the seafood industry by allowing fishing within permissible ecological limits. Moreover, to avoid excessive exploitation of resources, it has directed states to end bull trawling and refrain from using LED lights to attract fish.