US tariff scenario hits Asian shrimp suppliers, strains Ecuador's processing capacity

The piling up of tariffs in the US has affected shrimp trade and could reshape the market, with Asian suppliers being the most affected and limited capacity from Ecuadorian producers to fill the gap.

In the latest move, on June 5, the US Department of Commerce released preliminary results of its 19th review on antidumping duties for frozen warmwater shrimp imported from India, Thailand, and Vietnam. Indian exporters were assigned tariffs of 2.01%-5.32%, while for Thailand and Vietnam, Commerce announced significantly different rates dependent upon the individual exporter.

The final decision is expected in the second half of the year and could result in antidumping rates exceeding cash deposit rates, leading to additional payments. The measure led to a weakening of farmgate prices in India due to a slowdown in processor procurement.

Shrimp imports into the US have also been affected by a combination of antidumping (AD) duties, countervailing duties (CVD), and reciprocal tariffs.

The four main shrimp-exporting countries—India, Ecuador, Indonesia, and Vietnam—have been impacted since late 2024 with combined AD and CVD rates of approximately 7.1%, 3.8%, 3.9%, and 2.8%, respectively.

On April 2, 2025, the Trump administration imposed reciprocal tariffs of 26% on India, 10% on Ecuador, 32% on Indonesia, and 46% on Vietnam, although a week later it announced a 90-day pause, leaving a flat 10% tariff for all countries.

This situation gives Latin American countries like Ecuador, Mexico, and Argentina a competitive edge over most Asian exporters, who face significantly higher tariffs and uncertainty on reciprocal tariffs.

In April, US shrimp imports totaled 70,279 mt, an increase of 38% on the year. Imports from India rose by 26%, to 26,670 mt in the same period. Meanwhile, shipments from Ecuador more than doubled, to 20,031 mt, from 9,881 mt in April 2024.

The data shows that importers have been anticipating purchases and building inventories to protect themselves against tariff uncertainties.

"While we expect an overall increase in imports this year, much of the strong demand in the first half can be attributed to buyers seeking to replenish their inventories amid tariff uncertainties and we will likely see a drop off in import demand in the second half of the year," S&P Global Energy analyst Max Bouratoglou said.

Processing shrimp gap

Currently, India is the largest shrimp supplier in the US due to its capacity to provide processed products, such as peeled, deveined, cooked shrimp, and other presentations, which are preferred by US distributors and consumers.

Other countries have more limited capacity. Most South American shrimp producers have an ample supply of whole and headless shrimp, but limited capacity to supply more processed presentations.

Ecuador's exporters have noticed a sudden increase in demand for peeled and deveined shrimp from the US in recent weeks. In contrast, the appetite for less processed presentations, such as head-on and headless shell-on, remained weak.

According to sources, the reason is the uncertainty behind the so-called reciprocal tariffs, which are currently under a 90-day pause until July 9.

If no changes are made, after July 9, tariffs could apply to all products from key shrimp supplying countries, such as India, Thailand and Vietnam. Products from these countries are already being negotiated at discounts, according to market participants.

"Any shipments sent now from India will not arrive until July 9, and there is no telling what could happen after that," an exporter said.

Some processing plants in Ecuador have been operating at full capacity, with night shifts to increase peeled supply and meet previous orders. Currently, delays could surpass 60 days, according to sources.

There is enough production to supply HOSO and HLSO, but buyers are less interested in these presentations. "All they want is peeled and deveined shrimp," an exporter said.

Increasing the capacity of peeled and deveined shrimp should take time, as it requires investments in new equipment and employee training.

"Increasing processing capacity is a challenge for Ecuador," another source said.

Consumer price increases

US shrimp producers may benefit from reduced foreign competition, potentially increasing their market share and prices. However, domestic production is unlikely to fully replace imports due to capacity and environmental constraints, as over 90% of US shrimp consumption comes from imports.

With limited capacity in Ecuador and other suppliers, the effect of tariffs on shrimp demand and prices is almost inevitable, according to market participants. Importers have reported that US retailers reacted to the 10% increase from reciprocal tariffs by passing this increase onto the final consumer.

This comes when CIF imported price is at lower levels than previously. The Platts PDTO Shrimp CIF US assessment was $9,370/mt on June 3, down from $10,913/mt on Jan. 2.

The situation could lead to reduced consumption or a shift towards alternative proteins if shrimp becomes too expensive.

"I guess we'll be eating $25/lb shrimp in the future," an importer told Platts. "Asian companies will have to find other markets, and Americans who want to eat shrimp will have to pay the price. I'll eat more salmon, trout and chicken."

Tariffs timeline

Oct. 22. USDC announced its final determination in the antidumping (AD) and countervailing (CVD) duty cases concerning shrimp from India, Ecuador, Indonesia, and Vietnam

April 2. The Trump administration announced reciprocal tariffs (India 26%, Ecuador 10%, Indonesia 32%, and Vietnam 46%)

April 9. President Trump announced a 90-day pause on all reciprocal tariffs (all four main exporters face a 10% reciprocal tariff)

June 5. USDC released preliminary results of its 19th administrative review on AD for shrimp imported from India, Vietnam and Thailand (India 2.01%-5.32%, Vietnam's main exporters 35.29% and Thailand up to 57.64%)