Shrimp shift: Indian seafood exporters turn to China after US tariff shock

US President Donald Trump has levied a 50% tax on Indian shipments, making it difficult for the shrimp exporters to compete with Ecuador, Vietnam and Indonesia. In this backdrop, exporters are increasingly turning to China and also aiming to bolster shipments to markets such Europe, the UAE, Japan and South Korea, industry officials and experts said.

Chinese buyers, supported by strong domestic demand, have stepped in with forward contracts, making the market increasingly attractive, they said. Forward contracts are agreements to buy or sell a specific product at a pre-negotiated price on a future date.

“The tariff shock has turned out to be a blessing in disguise for Indian shrimp exporters. China, which was previously the second-largest importer of Indian shrimps after the US, has now emerged as one of the most promising markets. It is likely to become the top importer of Indian shrimps in the near future," said Shaji Baby John, chairman and managing director of Kings Infra Ventures Ltd, a Kerala-based shrimp exporter.

Industry experts note that while India once treated China as a secondary market, the US tariff shock has elevated its importance. China’s strength in seafood processing and re-exports has further encouraged Indian exporters, as Chinese processors procure raw material from India for re-export to duty-free markets.

To mitigate the tariff impact, Indian exporters are expanding their reach beyond China into other Asian markets. Those with US contracts are negotiating with buyers to share the tariff cost and simultaneously tapping into domestic demand in cities such as the Delhi-National Capital Region, Bengaluru, Hyderabad and Coimbatore, added John.

Trade data from the commerce ministry shows that in fiscal year 2025 (FY25), India exported marine products worth $7.39 billion, of which $2.68 billion went to the US, accounting for about 36% of total exports. In FY24, marine product exports to the US stood at $2.50 billion.

As per commerce ministry data, in the first four months of FY26 (April-July), exports of marine products, including shrimps, rose 18% year-on-year to $2.60 billion.

However, the steep American tariffs have severely affected shipments to the US. According to a Global Trade Research Initiative (GTRI) report, shrimp exports to the US plunged 43.8%, from $289.7 million to $162.7 million, between May and August this year.

Shipments of Vannamei shrimp, India’s largest seafood export, dropped 52.2% to $98.6 million, significantly impacting employment in coastal processing clusters.

“Amid the tariff shock, exporters are also looking at European Union (EU) markets and counting on the UK FTA (free trade agreement) deal. Additionally, we are focusing on the Russian market, which has significant growth potential," said K.N. Raghavan, secretary general of the Seafood Exporters Association of India.

Raghavan pointed to a recent development crucial for Indian exporters, noting that the EU has approved exports from 102 additional Indian marine establishments. This move is timely and reinforces the EU’s role as a key market, particularly since it is the third-largest shrimp market after the US and China.

Earlier, Mint reported on 8 September that India’s commerce ministry is moving to soften the blow by redirecting exports to trusted partners such as Singapore and the UAE. Singapore has agreed to increase purchases of Indian farm goods and is likely to open its market to seafood, offering relief to marine exporters, while the UAE is being positioned as an alternative hub for textiles, one of the worst-hit sectors.

According to InCred Equities, a financial services firm, while Ecuador dominates the global shrimp segment, India’s strength lies in value-added shrimp. Indian shrimp is preferred in the EU, but long-standing barriers—including a freeze on plant approvals—had limited India’s access. “With plant approvals now cleared, the next priority is addressing both tariff and non-tariff barriers that continue to restrict Indian access to the EU market," said InCred Equities in its report dated 10 September.