In the face of a challenging global market and declining shrimp exports, Bangladesh is grappling with a decision by the government to reduce incentives, leaving exporters in a tight spot. The first quarter of the current financial year saw shrimp exports fall short of the target by US $56.5 million, with production decreasing by 3000 metric tons (MT) compared to the same period in the previous fiscal year.
Data from the Department of Fisheries Inspection and Quality Control reveals a concerning trend. In the fiscal year 2021-22, 24,104 MT of frozen shrimp were exported. However, in 2022-23, this figure dropped by 4,000 MT to 19,904 tons. The first six months of the current financial year saw 9,971 MT of shrimp exported, marking a 3,000 MT decrease compared to the corresponding period last year.
The initial target for shrimp export earnings in the first quarter of the current financial year was US $158.7 million, but the income fell by US $54.6 million, reaching US $102.13 million. The high price of shrimp in Bangladesh has hampered its competitiveness in the global market, and the recent decision by the government to reduce the one percent incentive has further impacted exporters.
Sujan Ahmed, General Secretary of the Seafood Export Buying Agent Association of Bangladesh, highlighted internal issues contributing to Bangladesh’s struggle in the shrimp export market. He mentioned instances where Bangladeshi shrimp, due to various reasons such as short weight, were rejected by several countries, leading to a loss of interest among buyers. The decision to cut incentives, Ahmed warns, could exacerbate the existing deficit in the export sector.
Kazi Belayet Hossain, President of the Bangladesh Frozen Food Exporters Association, shared similar concerns, predicting that the reduction in the one percent incentive for shrimp exports could intensify production deficits, resulting in a further decline in exports.
While the Directorate of Fisheries Inspection and Quality Control in Khulna has suggested focusing on the export of value-added products to boost exports, there is no clear stance on the reduction of incentives. Monirul Islam, Deputy Director of the Fisheries Inspection and Quality Control Department, hinted at exploring the possibility of importing shrimp, repackaging it, and re-exporting it as a potential strategy.
As Bangladesh grapples with the challenges facing its shrimp export industry, stakeholders are urging a reconsideration of the decision to reduce incentives, emphasizing the need for comprehensive strategies to enhance competitiveness and revive the country’s position in the global market.
