It is 4.30 a.m. and long before the dawn broke, John Raju, an aqua farmer from a village near Palacole in the West Godavari district, wakes up to an alarm buzz and peeps out anxiously from his bedroom window into his backyard. He then heads out hurriedly towards his shrimp pond and walks along its embankment, with aerator machines making a constant whirring sound. They have been running through the night.

He then pauses at a stilt and glances across the pond, spread across a sprawling 10 acres. In the pond, he sees tens of thousands of shrimps, reminding him of the months of hard work and investments of lakhs of rupees to fetch profits from the business. Although there are hopes, fear lingers with the rising feed price, which has become a stiff challenge not only to John Raju but also to thousands of farmers across the State’s aquaculture belt in districts of Godavari, Krishna, Bapatla, Prakasam and Nellore.

According to farmers, feed manufacturers have recently increased the price of Vannamei shrimp feed by ₹10 per kg and Black Tiger shrimp feed by ₹12 per kg. As a result, the price of a 25-kg bag of tiger shrimp feed has gone up by ₹300 and vannamei feed by ₹250.

“There was a time when I worried only about the produce falling prey to diseases. But today I worry about the aqua feed,” he says anxiously.

What was once considered one of rural India’s greatest success stories has been turning tables for farmers by heaping stress, uncertainty and shrinking margins.

Stakes are high

The stakes extend far beyond individual farmers. Aquaculture has been one of the most significant drivers of the State’s rural economy, supporting lakhs of livelihoods directly and indirectly. The sheer scale of operations underscores why rising feed prices have emerged as a matter of statewide concern.

According to the government, aquaculture is currently being practised across nearly 2.35 lakh hectares in Andhra Pradesh. Fish farming occupies about 1.22 lakh hectares, while another 1.13 lakh hectares are under brackish water aquaculture.

Commercially valuable species such as shrimp and sea bass are cultivated over nearly 1.2 lakh hectares, with the fortunes of a vast network of farmers, labourers, hatcheries, feed dealers, processors and exporters tied to the sector. For many farmers, the concern is no longer about the profitability of a single crop but about the sustainability of an industry that has become a cornerstone of Andhra Pradesh’s coastal economy.

Farmers invest substantial sums in pond preparation, seed stocking, aeration systems, labour, electricity, water management and disease prevention. Among all these expenditures, however, feed prices take a lion’s share. It represents the single largest component of production costs, accounting for 60-70% of total expenditure in many shrimp farming operations.

Consequently, even a relatively small increase in feed prices can have a disproportionate impact on farm economics, says Bhagawan Raju, an aqua farmer and president of A.P. State Aqua Farmers Association.

Rising costs of raw materials vs feed prices

According to officials, the sharp rise in feed prices is primarily driven by escalating costs of key raw materials such as fishmeal, fish oil and soybean meal, which together form the backbone of shrimp feed production.

Fishmeal and fish oil supplies have been affected by lower anchovy catches, climate-related disruptions and fishing restrictions in major producing countries, while soybean meal prices have surged due to supply shortages and strong global demand.

Officials noted that feed manufacturers are also facing higher transportation, energy, packaging and import costs, further increasing production expenses. Since raw materials account for a major share of feed manufacturing costs, these increases have inevitably translated into higher feed prices for farmers. Raw materials account for the overwhelming majority of feed manufacturing costs. Fishmeal, fish oil and soybean meal alone can determine whether a feed company earns a profit or suffers losses.

For farmers, however, these explanations provide little comfort. The increase, farmers allege, was implemented without prior consultation with them and at a time when the industry is already struggling with rising production costs and fluctuating international market conditions.

“We are told fishmeal prices have increased. We are told fish oil is expensive. We are told soybean costs have gone up,” says Venugopal, a farmer. “Maybe all of that is true. But the shrimp buyer doesn’t pay us more because fishmeal has become costly. At the end of the day, it is the farmer who carries the burden.”

Meanwhile, Bhagwan Raju argues that feed prices in the year 2021-22 were increased, citing a rise in prices of raw materials such as soya and fish meal. Later, the prices of raw materials had come down, but the companies did not reduce the feed price, he recalls.

Farmers question feed pricing formula

Duggineni Gopinath, president of the Ongole District Prawn Farmers Association, alleges that shrimp feed companies often cite higher raw material costs during the annual fishing ban to justify feed price increases, arguing that the prices of fishmeal and fish oil typically rise immediately after the ban is imposed because of temporary supply constraints but decline once fishing resumes and supplies return to normal.

According to Gopinath, feed manufacturers usually procure and stockpile fishmeal, fish oil and soybean meal when market prices are relatively low. Despite this, he claims, companies continue to base feed price revisions on the higher prices prevailing during the fishing ban period. The government should adopt a more transparent mechanism for determining the costs of raw materials, he says.

Farmers’ associations have been demanding greater scrutiny of feed pricing, maintaining that rising input costs are eroding profitability in Andhra Pradesh’s aquaculture sector.

Fisheries Commissioner Rama Shankar Naik says the State government has formed a technical committee to examine the issues.

The committee is expected to assess the concerns raised by both farmers and feed manufacturers before submitting its recommendations. Based on the findings, the government will facilitate discussions between industry representatives and farmers’ associations to arrive at a consensus on feed pricing and address concerns affecting the aquaculture sector.

Small, medium-scale farmers feel the pinch

The anxiety is particularly acute among small and medium-scale farmers. Many farmers like Chidapotu Koteswara Rao from Tangutur depend heavily on borrowed capital. Before a crop even begins, they often take loans from banks, private financiers or relatives. Some mortgage land, while others pledge gold ornaments. Their calculations are based on carefully projected expenses and expected returns.

“When feed prices rise unexpectedly, those calculations can quickly unravel. A crop that initially appeared profitable may suddenly become marginal. A modest profit may turn into a loss,” Koteswara Rao says.

He feels that under current market conditions, Vannamei farmers can recover their investment only when shrimp reaches around 60 counts. Farmers harvesting shrimp between the 100 and 70 counts are reportedly losing ₹30-₹40 per kg. In shrimp farming, “count” refers to the number of shrimps needed to make 1 kilogram. Lower counts mean larger shrimp and generally better prices.

For Black Tiger shrimp farmers, the situation is similar. Production costs can typically be recovered only when shrimp reach around 40 counts. Any harvest at smaller sizes significantly reduces profitability.

The recent feed price hike, however, has shifted the break-even point even further. Farmers estimate that Vannamei shrimp would now need to be grown to nearly 40 counts merely to cover costs. Yet only a small proportion of farms consistently achieve such large harvests. Industry leaders claim that nearly 90% of Vannamei production is harvested between the 100 and 50 counts, meaning a vast majority of farmers may struggle to remain profitable under the revised feed pricing structure.

For Black Tiger shrimp, the challenge is equally severe. Farmers estimate they would now need to achieve around 30 counts of shrimp to break even, a size reached by only a fraction of total production.

The industry also faces volatile export demand, global competition and unpredictable weather. Many farmers rely on loans, adding financial pressure. As farmers gather across Andhra Pradesh, discussions now revolve less around production and more around costs.

“This is why shrimp farmers closely track both count and market price before deciding when to harvest. In Andhra Pradesh’s aquaculture industry, daily conversations among farmers often revolve around questions such as “What’s the 30-count price today? or ‘Has the crop reached 40 count yet?’ because count directly determines profitability,” says Gopinath.

Demand grows for government’s intervention

The farmers argue that the companies have increased the prices of feed without the approval of the Andhra Pradesh State Aquaculture Development Authority. Later, with the intervention of the Chief Minister, the companies agreed to bring down the prices, but they went back on their assurance by slashing merely ₹2 per kg. With these prices, the farmers would not get break-even if they went for a 60-count harvest.

Farmers state that the Andhra Pradesh government has to intervene and examine the circumstances surrounding the feed price increase. They argue that feed prices should not be viewed solely as a commercial matter between companies and farmers but as an issue with broader implications for rural employment, exports and economic growth.

According to officials and farmer associations, any sustained decline in shrimp cultivation could trigger a chain reaction across the sector. Reduced production would affect hatcheries, seed suppliers, feed dealers, cold storages, ice plants, transport operators, processing units, exporters and numerous ancillary businesses dependent on aquaculture.

Cold storage facilities, which handle large volumes of harvested shrimp before processing and export, could witness a sharp fall in utilisation. Ice plants, truck operators, harvesting labourers and workers in peeling sheds and processing factories may also face reduced income and employment opportunities.

Leading seafood-producing State

The impact could extend to export earnings as well. Andhra Pradesh is one of India’s leading seafood-producing States, and shrimp remains among the country’s most valuable marine exports. A prolonged slowdown in cultivation could affect export commitments, reduce foreign exchange earnings and weaken the State’s contribution to national seafood exports.

Farmers’ associations estimate that up to 80% of cultivators may reduce stocking or exit aquaculture if rising costs continue to outpace farm-gate prices, placing the livelihoods of nearly two million people at risk.

For now, farmers are seeking immediate relief through a rollback of the latest price increase. But the larger debate revolves around the long-term sustainability of an industry that has transformed coastal Andhra Pradesh over the past two decades. Whether policymakers step in or allow market forces to prevail may determine the future trajectory of one of the State’s most important export-orientated sectors.