Trump’s 25% Tariff Sparks Sell-Off in Shrimp Export Stocks

Market Performance

On Thursday, July 31, shares of major Indian shrimp exporters—Avanti Feeds Ltd., Waterbase Ltd., and Apex Frozen Foods Ltd.—witnessed a sharp fall, reacting to global trade policy shifts.

• Avanti Feeds Ltd. share price dipped by up to 6% in early trade
• Waterbase Ltd. and Apex Frozen Foods also recorded similar intraday declines
• Losses were later trimmed, with stocks trading 2%–4% lower by mid-session

This sudden market reaction came following a fresh round of tariff announcements by the United States government.

Main News

US President Donald Trump unveiled a 25% tariff on Indian goods, coupled with an unspecified penalty linked to India's trade ties with Russia, including defense and oil transactions.

This move directly affects India’s seafood export industry, particularly shrimp exports, where the US remains a critical market.

Company Exposure to the US Market

• Avanti Feeds Ltd.:
  • Derives approximately 77% of its total revenue from the North American market
  • This is a marginal drop from 80% in the previous corresponding quarter
• Apex Frozen Foods:
  • In its March quarter investor presentation, reported 53% of its revenue came from the United States
• Waterbase Ltd.:
  • While specific revenue distribution is not disclosed, it operates primarily in the shrimp feed and processing segment, with significant exposure to export markets like the US

Impact of Increased Tariffs

• Prior to this announcement, Indian shrimp exports to the US were already facing an effective customs duty of 17.7%
  • Countervailing Duty (CVD): 5.7%
  • Anti-Dumping Duty (ADD): 1.8%
• With the new policy, the total tariff would rise to 25%, adding pressure on profit margins and competitive pricing

Shrimp Industry Insights

• India holds about 20% of the global shrimp market share
• Production is expected to remain steady at 1.2 million metric tonnes this fiscal year
• As per Avanti Feeds' annual report:
  • 48% of India's shrimp exports are destined for the US
  • This highlights the industry's high exposure to US policy changes

Company Details

Avanti Feeds Ltd., Waterbase Ltd., and Apex Frozen Foods are among India’s key players in the shrimp and aquaculture industry. All three companies depend heavily on international markets, especially the United States, for a large portion of their revenue.

These businesses operate across the shrimp hatchery, feed manufacturing, processing, and export chains, making them directly sensitive to global trade policy developments.

Summary

The imposition of a 25% tariff by the United States has sparked volatility in Indian shrimp exporter stocks. The Avanti Feeds Ltd. Waterbase Ltd. and Apex Frozen Foods share price saw sharp declines amid growing concerns over profitability and trade access.

With the US being the largest consumer of Indian shrimp, contributing nearly half of total exports, such policy changes significantly impact market sentiment and investor confidence in these companies.