Despite a punishing 50%+ tariff wall erected by the United States in August 2025, India’s shrimp industry is showing signs of resilience—and even cautious optimism—as it enters the peak hatchery season from December 2024 to April 2025. While the export landscape has shifted dramatically, industry players are adapting fast, diversifying markets, and betting on stronger domestic and Asian demand to offset losses.
The Tariff Shock: What Happened?
On August 27, 2025, the US imposed a combined tariff of 58.26% on Indian shrimp imports. This includes:
- A 25% reciprocal tariff
- A 25% penalty tariff
- Existing anti-dumping (2.49%) and countervailing duties (5.77%)
The impact was immediate:
- Export volumes projected to fall by 15–18% in FY26
- Revenue decline estimated at 18–20%
- Operating margins compressed to a decade-low of 5–5.5%
Andhra Pradesh, which contributes over 50% of India’s shrimp output, was hit hardest. Disease outbreaks and falling farm-gate prices added to the pressure3.
Turning the Tide: Why Optimism Persists
Despite these setbacks, several factors are fueling hope for a better season:
1. Market Diversification: Exporters are pivoting to China, Europe, the UK, Japan, and South Korea. China, once a secondary market, is now emerging as a top buyer thanks to forward contracts and re-export capabilities.
2. Hatchery Enquiries Rebound: With the main PL (post-larvae) season underway from December to April, hatcheries are expecting stronger demand than last year. Farmers anticipate better prices in alternative export markets and domestic retail chains.
3. Government Support & FTAs: India is banking on new trade agreements to soften the blow:
- The India–EFTA FTA (Switzerland, Iceland, Norway, Liechtenstein) launched in October 2025
- The India–UK FTA, expected to eliminate 8–12% duties on marine exports in early 2026
These deals could unlock access to high-value seafood markets and reduce dependence on the US.
4. Innovation & Integration: Andhra Pradesh has launched a Seaweed-Shrimp Integration Model to diversify income and improve pond health. This could help farmers hedge against biological and market risks.
What to Watch in 2026
| Factor | Trend | Implication |
|---|---|---|
| US Tariffs | 58.26% effective duty | Shrinking US market share |
| Export Volume | ↓ 15–18% (projected) | Revenue pressure |
| Hatchery PL Demand | ↑ vs. year 2025 | Stronger restocking momentum |
| China & EU Market Share | ↑ | New growth avenues |
| Domestic Retail Demand | ↑ in metro cities | Buffer against export volatility |
| Government Interventions | FTAs, subsidies, diversification | Strategic cushioning |
Final Word
While the US tariff shock has undeniably hurt India’s shrimp exporters, the industry isn’t sinking—it’s swimming sideways, exploring new currents. With hatcheries gearing up for a stronger PL season and exporters diversifying aggressively, 2026 could still turn out better than expected. Challenges are real, but the sector knows how to adapt and move forward..