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Cablegate: Nigerian Shrimpers: Hopeful (but Unlikely)

This record is a partial extract of the original cable. The full text of the original cable is not available.

040618Z Dec 03

UNCLAS LAGOS 002455

SIPDIS


E.O. 12958: N/A
TAGS: EFIS ETRD ECON NI
SUBJECT: NIGERIAN SHRIMPERS: HOPEFUL (BUT UNLIKELY)
PLAYERS IN U.S. MARKETS


1. (U) Summary: Nigeria's principal fisheries products,
shrimp and prawns, are destined almost exclusively for
export, but only a small percentage of Nigeria's total
catch makes its way to U.S. markets. Exports are
hindered primarily by high shipping costs and consumer
preferences. Industry representatives say interest in
expanding exports to U.S. markets is high, but unless
conditions change, significant increases are unlikely.
End summary.


2. (U) Of all commercial fisheries in Nigeria, shrimp
fisheries are by far the most lucrative. With nearly
three-quarters of the country's 250 vessels dedicated
to shrimp trawling, Nigeria's fisheries produce shrimp
and little else. Trawlers with twelve- or thirteen-
person crews spend as many as 50 consecutive days in
the Niger Delta region, often many miles offshore, and
return with hundreds of metric tons of processed and
frozen shrimp. Approximately ninety percent of the
catch is exported, most of it to Europe, China and
Japan. Very little of it makes its way to U.S.
markets.


3. (U) Sam Azebeokhai and Robinson Omomia, President
and Executive Secretary of the Nigerian Trawler Owners
Association (NITOA), respectively, say several of the
association's 45 member companies are looking for ways
to expand exports to the United States. Many purchase
trawling vessels from U.S. manufacturers, and more than
a few are interested in strengthening relationships
with their U.S. counterparts.


4. (U) The interest is there, but Nigerian shrimp
producers find it difficult to export to U.S. markets,
mostly because transportation is prohibitively
expensive. It is also scarce. Since few if any ships
sail directly between the U.S. and Nigeria, most
exporters find it easier and more economical to send
their catch elsewhere. In just a few months, they will
find it even easier to do so: NITOA expects to open a
large-scale fisheries laboratory in Lagos in mid-
January. The facility was built with EU technical
assistance and will streamline the certification of
shrimp products' compliance with international
standards. Azebeokhai and Omomia believe the
laboratory will make European markets even more
attractive to Nigerian shrimp producers.


5. (U) Exports to U.S. markets are further hindered by
consumer preferences for peeled shrimp with no heads.
According to Manjit Sadarangani, Managing Director of
Atlantic Shrimpers Limited, Nigeria's largest shrimp
exporter, the preference leads to significant weight
loss: up to 35 percent in some cases. Nigerian shrimp
exporters may be able to sell their products at a ten
percent premium in U.S. markets, but they lose so much
weight meeting consumers' demands that they can make
more money in Europe selling heavier products at
slightly lower prices.


6. (U) Comment: Nigerian shrimp producers looked
briefly to AGOA to provide a cost-effective means of
entering U.S. markets, but shrimp and prawns are
excluded from AGOA trade preferences. They are
likewise excluded from GSP concessions, although they
are free of duty, with the exception of shrimp and
prawns containing meat products (these are subject to
five percent ad valorem tariffs). In the absence of
duties, shipping costs and consumer preferences appear
to be the biggest obstacles facing Nigerian shrimp
exporters. A further obstacle may be Nigeria's
inadequate use of turtle excluder devices. Shrimp
producers are reluctant to use them, even though their
non-compliance could lead to the exclusion of their
products from U.S. markets. At the moment, the absence
of a large market leaves little incentive for
compliance. Unfortunately, unless Nigerian shrimp
exporters partner with U.S. firms or overcome these
barriers, significant inroads in U.S. markets are
unlikely. End comment.


HINSON-JONES

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