New Delhi, May 30 Indian shrimp exporters will see a marginal 2-3 per cent uptick in revenues this fiscal (FY26) on improved realisations stemming from rising prices and currency gains, a Crisil report said on Friday.
Though the low-value-added shrimp exports will likely see increased pressures, Indian exporters have a competitive advantage in the value-added segment over other Asian peers, such as China, Vietnam, Thailand and Indonesia, which face higher tariffs but enjoy over one-third market share in the US.
However, export volumes will be flat because of higher tariffs expected to be imposed by the US and subdued demand in key importer nations as sluggish economic growth affects disposable incomes.
India exports close to 48 per cent of its produce to the US. The reciprocal tariffs announced by the US, though paused for the time being, will benefit south American exporters such as Ecuador, the largest shrimp exporter in the world. Indian exporters will face higher competition from them in the raw frozen and peeled frozen categories, which have low value addition and are less remunerative.
According to the report, operating margins will be under pressure because the tariff burden will be passed on only partially and gradually, as seen in the past, even as exporters scout for other markets and improve offerings through value addition.
Credit profiles will continue to face challenges as elongated working capital cycles induce further recourse to credit lines that, in turn, would moderate debt protection metrics. Capital structures are expected to remain comfortable, however, the report mentioned.
“Last fiscal, the waters turned choppy for Indian shrimp exporters as prices and competition increased after a countervailing duty of 5.77 per cent was slapped by the US,” said Himank Sharma, Director, Crisil Ratings.
This fiscal, with the US imposing reciprocal tariffs -- even as other major markets such as the European Union and China see sluggish economic activity -- exporters will likely see flattish demand.
“But as realisations tick up, overall growth in revenues should be in low single digit this fiscal,” Sharma added.
Global shrimp demand has flatlined at 4 million tonne (MT) over the past few fiscals and will likely remain subdued this fiscal, too. Indian exporters have around a fifth of the global market share as of now, while domestic production is seen flat at 1.2 MT due to non-remunerative global prices impacting shrimp culture and growth, this fiscal.
Nagarjun Alaparthi, Associate Director, Crisil Ratings, said that “Despite rising debt, the capital structures of shrimp exporters will remain healthy”.
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