Ecuador has long been a dominant force in the global shrimp market, particularly in the production and export of vannamei shrimp. However, after years of rapid expansion, the industry is now facing significant hurdles that threaten its profitability and long-term sustainability.
A Decline in Export Value
In 2023, Ecuador’s shrimp export value contracted by $364 million (-5.5%), marking a stark contrast to the $3 billion (+84.2%) growth recorded between 2020 and 2022. The decline is largely attributed to weak market prices and rising input costs, which have squeezed profit margins for producers. The National Chamber of Aquaculture (CNA) estimates that the industry lost $1.5 billion in profits year-over-year.
Supply Chain Pressures & Market Risks
Ecuador’s shrimp sector is grappling with high feed, labor, and processing costs, along with political instability and adverse weather conditions. Additionally, the country’s heavy reliance on China as its primary export market (59% of total exports) has raised concerns, as China is actively working to increase domestic shrimp production and reduce imports.
The Rise & Dominance of Ecuadorian Shrimp
Despite these challenges, Ecuador’s shrimp industry has experienced exponential growth over the past two decades. From 40,000 tonnes exported in 2000 to 1.2 million tonnes in 2023, the country has surpassed both China and India to become the world’s largest shrimp exporter. Ecuadorian shrimp are known for their low stocking densities, which contribute to year-round harvests and superior shrimp health compared to competitors.
Key Constraints to Future Growth
While Ecuador remains a leader in shrimp production, several factors are limiting further expansion:
- Shrimp Prices Falling: The average export price per tonne declined by 17.4% in 2023, reaching its lowest level since 2010.
- Inflation & Demand Decline: Global inflation has reduced consumer spending, particularly in restaurants and food service industries, where shrimp is often marketed as a premium product.
- Industry Consolidation: Larger farms with economies of scale are absorbing smaller producers, raising barriers to entry for new players.
- Disease & Trade Restrictions: Shrimp-specific pathogens, such as white spot syndrome, have led to import bans from China, further disrupting exports.
- Political Instability: Organized crime and security concerns in shrimp farming regions have added uncertainty to the sector’s future.
Looking Ahead: Can Ecuador Adapt?
Despite these setbacks, Ecuadorian shrimp producers remain optimistic. Industry leaders believe that continued investment in technology, genetics, and sustainable farming practices will help maintain Ecuador’s competitive edge. However, diversification beyond China and expanding value-added processing capabilities will be crucial for long-term stability.
As the global shrimp market evolves, Ecuador must navigate economic pressures, trade policies, and shifting consumer preferences to sustain its position as a leading exporter.