Chapter: 01 INTRODUCTION 1.1
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Critical issues, government policies and business preparation of Shrimp export business of Bangladesh. Chapter: 01 INTRODUCTION 1.1 . Introduction Bangladesh registered a 40 percent rise in exports earnings from frozen foods mainly shrimp to $625 million in fiscal 2010-11 from $445 million in the previous year, according to EPB. The EU is the largest market for the country's frozen fish, followed by the . Shrimp production and export in Bangladesh has undergone rapid expansion over the last two decades. Shrimp is a very valuable export commodity, generating substantial revenues and foreign exchange and creating employment opportunity. Bangladesh has a total of 145 shrimp export industries. Of these, 94 industries are situated in Khulna division. In Bangladesh, shrimp industry is the second largest foreign currency earner after the garment industry. About 1.3 million people are involved in forward and backward linkage activities like fry collection, hatching, nursing, production, harvesting, processing, export and other logistic support services. The shrimp industry envisions to increase export quantity and to earn 1.5 billion USD by 2010. Shrimp culture started in Bangladesh in the coastal district of Satkhira in 1960s. Gradually, its culture expanded to the coastal belts of Khulna, Bagerhat, Cox‘s Bazar and Chittagong and now the area under shrimp culture has increased from 52,000 ha in 1982-83 to 270,000 ha in 2007-08 (Bangladesh Frozen Food Exporters Association, BFFEA, 2009). About 90% shrimp land is located in the Khulna, Bagerhat, Satkhira and Cox‘s Bazar districts in the south-eastern region of the country. Despite the rapid growth of Bangladeshi shrimp cultivation, the global frozen fish and seafood market continues to be dominated by Thailand, Indonesia, China, and Ecuador. Significant innovations in production and processing in these countries have increased the value added associated with their exports and the market share that they command. Unfortunately, the same is not true for Bangladesh. Production and processing innovations remain unrealized. Furthermore, stricter import requirements and compliance regulations in importing countries have meant that Bangladesh must invest in improving the safety and quality of their fish and seafood exports to avoid products being detained and rejected at point of entry into foreign markets. A recent IFPRI (2003) report notes that: ―The only way Bangladesh can improve its export position in the shrimp market is to improve the safety and quality of its exports.‖ Bangladesh has the potential to increase production, raise productivity, upgrade processing facilities, and draw further land into shrimp cultivation. The shrimp/prawn producing unit in Bangladesh is locally known as ―gher” farming. Gher farming is a combined form of aquaculture and agriculture. Shrimp/prawn gher farming system has significant impacts on agriculture and the economy of Bangladesh and has created many diversified local job opportunities like mud snail traders, prawn fingerlings traders, ice factory, depot owners, etc. A large number of male and female workers supply their labor in this sector. The basic components of one‘s standard of living such as food consumption, medical care, education, housing, and clothing have improved after the introduction of the gher revolution. Now the people in this industry can have three meals a day which was not possible in the recent past. They can also afford to send their children to school for education. 1 Daily Star, Tuesday, August 16, 2011 Page 1 of 64 Critical issues, government policies and business preparation of Shrimp export business of Bangladesh. 1.2. Origin of the Report We are lucky to say that our honorable course teacher of International Imranul Islam, Lecturer, Department of Marketing, PSTU has assigned us a report on “Critical issues, government policies and business preparation of Shrimp export business of Bangladesh.”. This report is prepared on the basis of the data collected from 5 samples of Shrimp producers, 5 samples of Shrimp suppliers, 5 samples of Shrimp Exporters from Rupsha and Bagerhat under Khulna District. 1.3. Significance of the Study This study has a great significance like- i) Can be used to have the idea about Shrimp exporting Business in Bangladesh. ii) Can be used for further research. iii) Can be used for academic purpose. iv) Can be kept as a statistical work 1.4. Objectives of the Report Our targeted major objectives of this study are as follows: i) To have the market knowledge of shrimp exporting Business in Bangladesh. ii) To know the production and exporting procedures of shrimp in Bangladesh. iii) To observe the Government policy regarding Shrimp exports Business. iv) To get idea about Business preparation of shrimp export. v) To examine the impacts of various factors on Shrimp exporting Business. 1.5. Limitation of the Study We have, as it is an analysis based report, faced many problems while preparing this report. The basic limitations that we have faced are as follows- i) Shortage of time. ii) Lake of pre- experience. iii) Minimum number of respondents. iv) Lake of proper knowledge. 1.6. Methodology of the Study It is very essential to maintaining a proper methodology for achieving the target objectives of any research. The study will be conducted to maintaining the following steps: Selection of Study Area Rupsha and Bagerhat have been selected as the study area, considering the Shrimp production and Exporting and affecting factors. Sources of data Both primary data and secondary data have been used in this study. The primary data were collected from the survey. Secondary data collected from internet. Page 2 of 64 Critical issues, government policies and business preparation of Shrimp export business of Bangladesh. Size of Sample and Period of Data Collection In selecting samples for a study two factors need to be taken into consideration. The sample size should be as large as to allow for adequate degrees of freedom in the statistical analysis. It was not possible to include all the population in the area studied due to limitation of time, money and personnel. A total number of 15 (5 Shrimp producers, 5 Shrimp suppliers and 5 Shrimp exporters) have been selected from Rupsha and Bagerhat. Data has been collected during December-2nd week 2012 by interviewing the sampled respondents using interview schedules. Preparation of Interview Schedule Another crucial basis of the field level study is to prepare a correct interview schedule which help to achieve the ultimate objectives of the study. For this, primary interview schedule has been pre-tested comparing with many other standard one. After necessary correction and modification, the interview schedule has been finalized to collect data from the respondents. In our interview schedule we have used number leveling the degree of importance of the factors affecting the Shrimp exporting Business. The number leveling are- No Importance 1 Not Such Important 2 Average Important 3 Important 4 Very much Important 5 Collection of Data Obviously, both practical and theoretical data are needed in the relevant research. The researchers themselves have collected the data by interviewing the selected respondents. All possible efforts have been made to ensure the collection of reasonably accurate information from the field. At first, the objectives of the present study have been explained to the respondents and then they will be requested to provide correct information. Research Instruments The survey was conducted with only one-structured questionnaire. In our questionnaire, we used two types of question pattern like, open questions, closed questions to design the questionnaire. Sampling plan We have selected the Rupsha and Bagerhat as the sample places for our convenience, sample size was 15 and information was collected from Rupsha and Bagerhat and the result has been considered for the overall Bangladesh. After this we have analyzed the finding, identified the problems and made recommendations. Processing of Data The collected data has been carefully edited and coded. Then all the collected data will be summarized and scrutinized. Data entry has been made in computer and analyses have been done using the concerned software Microsoft Excel. Analytical Technique To meet particular research objectives, several analytical methods have been employed in the present study. Tabular method has been used for a substantial part of data analysis. This technique has been intensively used for its inherent quality of purporting the true picture of the Shrimp producers, Suppliers and Exporters in the simplest form. Relatively simple statistical techniques such as percentage and arithmetic mean or average has been employed to analyze data. Page 3 of 64 Critical issues, government policies and business preparation of Shrimp export business of Bangladesh. Chapter: 02 MARKET KNOWLEDGE OF SHRIMP EXPORTING BUSINESS 2.1. Importing countries of shrimp Last year‘s export from Viet Nam of Bangladesh shrimp totaled 103.85 Million Lbs and this year the volume is likely to increase further. Despite difficulties faced by the aquaculture sector in 2009, Bangladesh managed to increase its shrimp exports by 10.65% in quantity and amounting to 437.40 million US$. Bangladesh exported shrimp to 82 destinations with the main markets being USA, Belgium, UK, Netherland, Germany, Russia, Saudia Arabia, Japan And Others. Black tiger shrimp contributed 75% of the total export value last year. USA & Belgium was the argest market taking around 35% of the Bangladesh total shrimp exports. Shrimp Exports From Bangladesh (2009-2010) USA Belgium UK Netherlands Germany Russia Saudia Arabia Japan Others 24% 18% 3% 17% 3% 8% 14% 3% 10% Source: Bangladesh Frozen Foods Exporters Association 2009 Page 4 of 64 Critical issues, government policies and business preparation of Shrimp export business of Bangladesh. Shrimp and Fish From Bangladesh (2009- 2010) Shrimp 20% Fish 80% 2.2. Global production and trade The total global production of farmed shrimp reached 2.5 million tonnes in 2005. This accounts for 42% of the total shrimp production that year (farming and wild catches combined).