US embassy cable - 03LAGOS2455

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