Just like the prices of other food commodities, shrimp prices experience fluctuations due to the supply-demand principle. This fluctuation impacts farmers as they rely on the selling price of shrimp in determining their harvesting times.
Factors that impact the cost of shrimp
There are several factors that impact the cost of shrimp, such as:
- Price of cultivation needs such as feed, stock, probiotics, and other goods
- Price of farm equipment
- Price of other relevant commodities such as fish meal, soy, and other raw ingredients for cultivation
- Dollar exchange rates that impact feed ingredient price
- Weather conditions
- Domestic and export market demands
Most of these factors impact the cost of shrimp production, which in turn affects the selling price. Methods and technologies that can improve cultivation productivity may help in decreasing production costs. That way, farmers can obtain a larger profit.
The main factor that impacts the decline in shrimp prices
The main factor that impacts the decline in shrimp prices is the market demand. Shrimp prices in Indonesia heavily rely on export markets. For example, during the beginning of the COVID-19 pandemic, most export destination countries such as China, Japan, USA, and some European countries closed their seafood markets, creating a barrier for Indonesia to sell its shrimp. Therefore, shrimp in Indonesia needs a competitive advantage to increase the chances of exporting to a wider market.
Price is a crucial factor for farmers to consider when choosing their buyers. It’s best not to be fixated on a single buyer and compare prices to find the best offer instead. The best offer is not solely defined by the price alone, but also the transaction security. Farmers should also ensure that the buyers or harvesting team implement a proper and transparent harvesting technique.
