Shrimp Giant

In February, Ladex announced a deal with Sea Farms International, the largest shrimp farmer in Honduras, pooling resources to have a combined, larger processing capability, plus 10,000 hectares of shrimp farms, two hatcheries, a feed mill, 33 trawlers and the capacity to cold-store 10 million pounds of shrimp. Terms weren't disclosed.

Meanwhile, the family is building margins with value-added products. "We don't want to compete on price," says Moreira's son, Domingo A. Moreira, Ladex's president. "The mission is getting the highest value on the shrimp possible." He brings out a packet of grill-ready shrimp on bamboo skewers, marinated in a butter glaze of fresh garlic and olive oil and vacuum-packed. Producers throughout agriculture follow a similar value-added plan because "people who come up with a little niche can get rewarded for that," says Chuck Adams, marine economist with the Florida Sea Grant program at the University of Florida. "The question is, does that niche market have enough volume?"

The answer to falling producer prices, the Moreiras say, is to lower prices -- to the consumer -- further. Consumers still perceive shrimp as a premium product rather than a staple protein, and as such retailers and restaurants enjoy 200% to 300% margins on it, they say. In parts of Europe around Christmas, some shrimp was cheaper than poultry, Moreira says. When U.S. consumers get to share in the lower prices, "consumption will go right through the roof," and producers will "make it up on volume like we make it up in poultry," he says.

Beginning of the End?

GROWING PROBLEM: Until Asian shrimp farmers began flooding the U.S. market, "We were very profitable," says shrimp boat owner John Williams. now, "A lot of people have dropped out," says the executive director of the Southern Shrimp Alliance.

Florida's best-known shrimp are the pinks, but the future for shrimpers and growers here is anything but in the pink. The business is "not looking good," concedes John Williams, 55, a Tarpon Springs owner of four shrimp vessels and executive director of the Southern Shrimp Alliance, an industry group.

Prices have been in a free fall, he says, since 2002 when Asian growers, shut out of some world markets because of concerns about their use of illegal antibiotics, began dumping their shrimp in the U.S. market, driving down the price the boat owner received for medium shrimp to as low as 80 cents per pound.

Until then, "we were very profitable. We never were overfished. We never were overcapitalized," Williams says, but now, "a lot of people dropped out. A lot of people lost their boats."

National and state marketing campaigns to differentiate wild shrimp from farm-raised to consumers have helped demand for wild shrimp, but more needs to be done, Williams says. "It's the beginning of the end for the commercial shrimp fishermen in the United States," says Bob Rosenberry, editor and publisher of Shrimp News International in San Diego. "They are hunters and gatherers, and hunters and gatherers have always lost the battle to agriculture. I've been saying this now for 30 years. It's just been coming true for 30 years."

Land, labor and production costs, meanwhile, make the outlook for Florida farm-raised shrimp doubtful as well. The state aquaculture division has 24 entities on its shrimp-grower list but most are university-related or experimental. "I can only think of three that might possibly be producing," says the division's chief, Mark Berrigan. "The economics of it have just not proven out here."

Tags: Miami-Dade, Around Florida, Agriculture