India-US trade deal | Tariff cut sparks hope among Andhra's shrimp farmers, traders & exporters

Hyderabad: Shrimp farmers, traders and exporters in Andhra Pradesh are optimistic about a revival in the aquaculture sector after reports of a finalized US trade deal slashing the reciprocal tariff to 18%. While awaiting official clarity on the new rates, they see it as welcome progress "something better than nothing."

The hope follows a tough year as after US President Donald Trump announced 50% tariffs on Indian goods in late July 2025, shrimp aquaculture output plunged nearly 40%, according to market insiders as many farmers abandoned the sector.

Traders and exporters faced sharply reduced volumes and struggled to secure alternative overseas markets comparable to the US.

“Many farmers quit aquaculture in the last six months due to fewer liftings by traders or drastically low rates. We are now hopeful of a revival, with some farmers returning if the 18% tariff holds. It is still a burden, but is better than nothing. Prices for 30-count and 100-count shrimp dropped drastically,” Rudraraju Suryanarayana Raju, who runs 50 acres of shrimp farms in Bhimavaram, West Godavari told DH.

Shrimp are graded by count per kilo. Fewer shrimp per kilo means bigger size, which fetches higher prices and is believed to taste better.

Indian shrimp exporters already grapple with headwinds, including a 5.77% Countervailing Duty (CVD) that combined with other levies creates a 20% overall duty disadvantage versus competitors.

Beyond tariffs, Raju pointed to high price volatility "decided" by export industry leaders and soaring input costs as the real culprits behind farmers' distress.

“It's not just tariffs, the price volatility set by exporters and rising input costs are to blame. Twenty years ago, 30-count shrimp fetched Rs 700 per kg; now it's down to Rs 500 instead of an increase. Feed, which is 70% of production costs, jumped from Rs 500 per 25-kg bag to Rs 2,500. Diesel prices have also risen steadily. Government intervention is needed in these aspects or farmers' distress will continue,” Raju told DH.

Over 10 lakh families rely directly and indirectly on Andhra Pradesh's shrimp sector, which spans about two lakh hectares across coastal districts like East and West Godavari, Krishna, Guntur, and Nellore. The state leads India's shrimp exports to the US.

In FY 2023-24, India exported $2.55 billion in marine products to the US, with shrimp making up 92% and Andhra Pradesh supplying roughly 75% of India's total shrimp exports.

“There was a 30-40% drop in our US liftings over the last six months. Buyers there wouldn't bear the tariff burden, so we were forced to pass it on to farmers and ultimately stopped procuring not to burden the farmers. Lower tariffs would obviously benefit everyone. We are hoping for a strong season ahead,” B Ramesh, a West Godavari-based shrimp trader and exporter told DH.