Shrimps and Power Breaks
How Droughts and Outages Are Rocking Ecuador’s Crustacean Industry
As the Ecuadorian economy continues to develop, supporting growing industries is one of the government’s key responsibilities.
Providing the necessary support to businesses generates jobs, increases GDP and provides the country an opportunity to become a world leader.
Currently, Ecuador is one of the global powerhouses in the shrimp and crustacean industry. Ecuador exports the most shrimp globally and crustaceans are the second most exported good from the country. Crustaceans bring in almost eight billion dollars annually for the country.
However, recent power outages in Ecuador are rocking the industry’s opportunity to continue growing and maintain production.
Roughly 80% of Ecuador’s electricity comes from hydropower, but the country is facing the worst drought it has seen in over 60 years. Typically, Ecuador receives between 30 to 240 inches of rain. But since 2023, there’s been a major dry spell. This year, the country hasn’t received significant rainfall since June.
While the departure of El Niño accounts for some of the decreased rainfall, the drought is still significant and devastating to the country.
Since energy production is largely dependent upon water, the Ecuadorian government mandates power outages across the country to preserve energy during times of drought. This year, the government has issued many outages, ranging from 1 to 12 hours long.
In September, the Ecuadorian government mandated overnight power outages. Overnight power outages begin at 10 p.m. and last until 6 a.m. the next morning.
The shift to overnight power outages follows previous outages from the spring that had disproportionate impacts across Ecuadorian industries. During the last few months, randomized power outages throughout the day caused some companies to lose critical operating hours, thus severely impacting the companies’ total revenue.
While the overnight outages are now relatively consistent and generally preferable to the previous outage schedule, the government still implements impromptu power outages that negatively affect businesses across the country.
The primary cause of Ecuador’s current drought is the El Niño weather pattern. Last year, El Niño brought significant rainfall across the country. However, now that El Niño is headed out, the inconsistent and little rainfall Ecuador sees harms the country as a whole.
An April update on the state of the economy in Ecuador said that recent economic activity in Ecuador has slowed. Furthermore, the update evaluated that Ecuador’s economy is largely susceptible to the effects of climate change, such as drastic impacts from weather patterns.
The shrimp industry loses 5 million dollars from each outage. While many processing facilities maintain production with generators, losing power makes operating equipment harder to restart. The additional labor required to restart operating equipment alters daily production and creates internal complications to the workflow.
Furthermore, the ponds where the shrimp grow rely on electricity to regulate the temperature of ponds. Shrimp are unable to maintain their internal body temperature so the ponds in which they grow are vital to their development. Cooler pond temperatures create higher mortality rates within the shrimp industry.
On top of the struggles the industry faces as a result of the power crisis, the shrimp industry is facing additional production issues. With steady global demand but a smaller supply, shrimp producers struggle to keep up with industry needs.
Unstable temperatures in ponds also affect growth rate, resulting in smaller shrimp across the board, which are less desirable in global markets.
Without the shrimp industry, the broader Ecuadorian economy would suffer. While the power outages are somewhat unavoidable, government officials in Ecuador must communicate and find ways to preserve energy that continue to protect industries.