The Competitive Advantage of the US Shrimp Industry: A Focus on the Role of Shrimp Imports

Abstract

The US has become dependent on shrimp imports over the past decade. Imports account for seventy percent of the US supply of shrimp. Recognizing the important competitive role of shrimp imports in the US shrimp industry, important were evaluated using a gravity model for the period 1990-2000. The results show that shrimp has evolved from a luxury to a normal good. Domestic demand, driven by higher incomes has pulled imports into the US - with exchange rates playing an important role as a foreign exchange incentive for national governments. Distance, as a measure of transport costs and entrance into the US market, does not affect the quantity of shrimp imports. Increasingly, the US shrimp industry will be dominated by imports because US shrimp fisheries can not meet the domestic demand. The US has the potential to develop and grow shrimp farming operations, but any sustainable growth in the US shrimp industry is dependent on securing marketing contracts, developing marker niches, and overcoming negative government policy and regulatory actions towards domestic shrimp aquaculture.