Lower demand from China and less availability of containers is likely to bring down Indian seafood exports by 20% this fiscal, Jagdish Fofandi, national president of the Seafood Exporters Association of India (SEAI), said on Friday.
He said confusion regarding the extension of the Merchandise Exports from India Scheme (MEIS) till April 2021 is also affecting the export sector.
India exported 1,289,651 tonne of seafood in 2019-20, valued at $6.68 billion. China was the largest seafood export destination for India in terms of quantity, with imports of 3,29,479 tonne worth $1,374.63 million accounting for 25.55% in quantity and 20.58% in dollar terms.
“Export to China has come to a standstill with containers stuck at ports and Chinese importers delaying payments. Exports of sea-caught fish like croakers and ribbon fish, which are only exported to China, are the worst-hit. The Chinese authorities are not clearing the containers and there is a lot of confusion,” Fofandi said.
China halted the import of frozen seafood from India in November for a week after traces of Covid-19 were reportedly found on the outer packaging of samples.
Besides, Fofandi said, lower imports into India and the resultant dip in availability of containers is also causing hardships to the exporting community. Trade imbalance has led to an increase in freight charges, which is also cutting down the profit margins.
“The stock levels with the exporters are at an all-time high due to the slow movement of cargo. If the situation persists, it could lead to a cash crunch and put the exporting community into distress,” he said.
He added that 30-40% of the fishing boats on the western coast are still not operational.
Unit prices of exported fish are 30% lower year-on-year, according to SEAI.
Fofandi said that demand from major markets of US and EU is improving slowly, but exporters are concerned because of the delay in announcing the new export incentive scheme.
“The government has extended the MEIS till the year-end and the new scheme will only come into effect from April 2021.The support provided by the government helps exporters become more competitive in the global market,” he said.
According to the latest data by the US agency National Oceanic and Atmospheric Administration, Indian shrimp exports to US, the largest market, for the period of January-October 2020 fell to 221,519 tonne as against 231,901 tonne during the same period in 2019.