Value chain analysis of Penaeus vannamei in Tamil Nadu, India

Abstract

The global shrimp market was valued at approximately $ 68.40 billion in 2022 and is expected to expand at a compound annual growth rate (CAGR) of 5.5% from 2023 to 2030. Increased production of farmed shrimp particularly P. vannamei in Asia catered to the rising global demand for shrimp. India is one of the leading players in the global shrimp market recognized for its competitive pricing, quality, and compliance with international standards, making it a preferred choice among global consumers. Shrimp, the most important commodity in the seafood export basket, contributes 40.19% in quantity and 66.11% in value to total seafood exports from India. Against this background, this study evaluated the value chain for processed vannamei shrimp in Thoothukudi, Tamil Nadu, where over 90% of farmed vannamei shrimp are being processed. An examination of the profile of seafood processors indicated that they were well educated, experienced, trained, and were in the active group. Four different shrimp products viz., Block Frozen—Untreated (BF-UT), Block Frozen—Treated (BF-T), Individually Quick Frozen—Untreated (IQF-UT), and Individually Quick Frozen—Treated (IQF-T) with an annual production of 5850 tonnes, on an average was the output from the study area. Inputs were sourced need based, with essential and perishable raw materials acquired on a daily basis and other supplies procured monthly or weekly basis. While insulated vehicles transported farmed shrimp to processing plants, heavy-duty vehicles handled the transport of equipment and machinery. The average plant gate price of BF-UT shrimp rose from ₹ 562.72 ($ 6.75) to ₹ 881.32 ($ 10.58)/kg, representing a 56.62% increase in value. The main factors that determined the price were raw materials (49.04%) and the processors’ profit margin (29.24%). It was found that raw material cost significantly influenced the prices of BF-UT, IQF-UT, and IQF-T shrimp, while the processors’ margin influenced the plant gate values of BF-UT and BF-T shrimps. The study indicated that seafood processors can reduce cost by implementing scientifically managed inventory systems, utilizing AI and ML for input monitoring, automating product handling, and establishing local infrastructure like ice plants. Treated IQF shrimp yielded higher profit margins due to strong market demand and superior quality. Processors generated significant profits by value addition. However, despite these profits, they faced challenges in enhancing the value and quality at different levels. Addressing the constraints will improve the efficiency of the shrimp value chain in the processing sector, ultimately boosting value addition and competitiveness in the international market.