Small and medium enterprises (SMEs), which account for over 75 per cent of India’s seafood industry revenue, are set for a decent outing following a spurt in both production and exports.
These units are clustered around Veraval in Gujarat and Kochi in Kerala.
CRISIL Research expects the industry to grow 5-7 per cent year-on-year, compared with 6-7 per cent in the last fiscal year.
The domestic market, which accounts for as much as 70 per cent of industry revenue, will likely grow 7-9 per cent, apace with last fiscal’s growth.
However, exports, which have a 30 per cent share in revenue, are expected to turn around after a listless 18 months, and grow 2-4 per cent this fiscal, compared with a negative growth of 1 per cent in fiscal year 2019 — a year when disease and volatile weather in the southern states impacted production.
Further, the US market — which accounts for 35 per cent of India’s seafood exports in value terms — was impacted by the Seafood Import Monitoring Program (SIMP) and a ban on shrimps caught by vessels not fitted with turtle excluder devices (TED).
Exports were muted even in the first half of the current fiscal year, because of inventory pile-up in the US and Japan after a buying binge in the festive season of November-December 2018.
But demand has been improving in the second half, as the US and Japan exhausted their inventory, and production revived as companies complied with the SIMP and TED norms. Besides, an exponential increase in demand from China will offset slower offtake from Vietnam.