Unplanned power outages jeopardize Ecuador's shrimp industry

Caused by the worst drought in its recent history, Ecuador's severe energy crisis led its Government to announce last Monday that power cuts would be extended to the entire country for 12 hours a day, compared to the 8 hours planned. The National Chamber of Aquaculture (CNA) now warned the country's shrimp industry is in jeopardy if these power outages continue to be unplanned.

Vital to the Ecuadorian economy, Ecuador's shrimp industry already requested preventive measures to deal with energy shortages earlier this year. What the CNA is asking from the authorities now is a differentiated approach to electricity rationing for areas categorized as industrial.

Ecuadorian shrimp farmers are claiming for more planning and for it to be adapted to the particular characteristics of their value chain because, if planning is not followed, shrimp production and exports will be at risk.

Shrimp industry could lose up to USD 5 million a day

The National Chamber of Aquaculture recalled that electricity supply plays a fundamental role in all links of its value chain. If in shrimp farms the lack of energy affects water pumping, jeopardizing oxygen conditions and the survival of the crustacean, industries such as shrimp feed manufacturing require minimum times to turn on their equipment.

The same is true for the processing industry. Facilities need to plan product reception for sorting, processing, packaging, and containerization for export. Not having defined schedules prevents them from organizing logistics and jeopardizes the commitments' fulfillment with customers.

Not only that, but the processing facilities also require electrical power to process and freeze the shrimp at -18°C, which requires considerable amounts of energy. This process is essential to preserve product quality and meet food safety standards.

Therefore, the CNA pointed out that unexpected power outages in these key areas of the industry can generate economic losses exceeding USD 5 million a day (EUR 4.48 million).

The sector estimated that, if this scenario continues, it could accumulate losses of tens of millions in a few weeks, compromising not only exports but also the internal production of inputs and the survival of shrimp in ponds that depend on electrical systems.

"It's chaos and much worse than expected"

According to Reuters' information, speaking at the recently held United Nations General Assembly, President Daniel Noboa said Ecuador was experiencing its worst drought in 61 years. "It's chaos and much worse than expected," he said.

The same piece of information reported that Ecuadorian Energy Minister, Antonio Goncalves, told journalists that continued adverse weather conditions in the areas where the country's dams are located were to blame for the situation. "The important issue is that the climate is crazy, it has changed a lot," Goncalves said pointing out that the dry season started two months early. "We depend a lot on hydrology. I can't predict something that only God knows."

Given this situation, the shrimp industry expressed its willingness to work together with the authorities and stakeholders to find solutions to protect the industry. The CNA recognized, for example, the Government's initiative to involve the private sector in electricity generation during the crisis, although it also insisted on requesting an improvement in the flow of information provided by the energy sector authorities.

The hope is that there will be certainty in the schedules of the power outages, as well as the approximate duration of this crisis to be able to make a plan. In addition, as mentioned, Ecuador's National Chamber of Aquaculture insisted on requesting a differentiated approach to electricity rationing for those areas categorized as industrial, for example, in the cantons of Durán and Yaguachi in the province of Guayas.

The CNA argued that industrial demand in Durán is 140 MW, almost double that of residential (80 MW), which requires special treatment compared to other cities. It also proposed limiting power interruptions for the industrial sector to once a day, minimizing the impact on productivity.

Finally, the National Chamber of Aquaculture reiterated its request that announcements on energy restrictions be made sufficiently in advance to allow for efficient planning of industrial operations in the Ecuadorian shrimp sector.

*Source:

– '"The climate is crazy" Ecuador minister says as country faces 12-hour power cuts', Reuters article.