The Economics of Shrimp farming in Selected Asian Countries

Abstract

This paper discusses the status of shrimp farming and evaluates the level of profitability, the relative competitiveness in the production and trade of shrimp, and the technical efficiency of shrimp production in the major shrimp-producing countries of Bangladesh, China, India, Indonesia, the Philippines, Sri Lanka, Thailand, and Vietnam. The analysis is based on primary and secondary information collected by the WorldFish Center and its partner research institutes, and supplemented by a review of the existing literature. The chapter uses descriptive techniques to compare the performance across different levels of intensity and across the countries in terms of productivity, cost-effectiveness, and profitability. Results suggest that semi-intensive shrimp farming is generally the more profitable approach in Asia, supporting the claim that it is more sustainable. A domestic resource cost approach was adopted to assess the level of competitiveness and comparative advantage in the production and trade of shrimp. With the exception of Bangladesh, it is advantageous for countries to expand production and trade. The differences in comparative and competitive advantage across countries are due to (1) differences in productivity (e.g., Bangladesh compared with India), (2) border price (e.g., China and the Philippines), and (3) dependency on imported inputs (e.g., Thailand and Vietnam compared with the Philippines). In general, semi-intensive shrimp farming was more competitive and had a greater comparative advantage than intensive farming. The technical efficiency of shrimp farmiing in the countries studied shows the potential for increasing the level of shrimp production and, thus, improving the level of competitive and comparative advantage.