China’s Japan seafood ban sends Indian exporters surging as US tariffs squeeze margins

China’s sudden ban on Japanese seafood has opened an unexpected window for Indian exporters, giving the sector a boost at a time when steep U.S. tariffs have squeezed margins and dented shipments to its largest market. Beijing’s move, imposed amid an escalating diplomatic standoff with Japan over Taiwan, sent Indian seafood stocks surging on Wednesday, with several exporters posting their sharpest gains in months.

Shares of Telangana-based Avanti Feeds closed nearly 10% higher, marking its strongest daily jump in over two months. Coastal Corporation, which had already announced plans to deepen its presence in China to offset U.S. trade barriers, rose 5%. The immediate surge followed China’s announcement of a complete suspension of Japanese seafood imports after Prime Minister Sanae Takaichi linked the Taiwan conflict to Japan’s security.

China’s ban hits Japan, opens a gap

The latest ban is a major setback for Japan’s seafood industry, which had only recently resumed exports to China after a two-year halt over the Fukushima treated-water release. Despite seafood forming just 1% of Japan’s overall exports, China has historically taken 20–25% of its seafood shipments, making it Tokyo’s most critical market in this segment. A renewed blanket ban is expected to push Japanese exporters into deeper losses.

A lifeline for Indian exporters under tariff pressure

For India, however, the shift in China’s buying patterns offers timely relief. The US, India’s biggest seafood market with buyers such as Walmart and Kroger, has imposed duties of up to 50% in recent months as a penalty for New Delhi’s continued purchase of Russian oil. The tariffs have made Indian shrimp and fish less competitive, triggering a 9% year-on-year drop in exports to the U.S. in October.

Reports indicate that shipments to China, Vietnam, and Thailand have risen significantly, signalling a pivot toward Asian markets as exporters look to diversify away from tariff-heavy destinations.

India exported around $7.4 billion worth of seafood last fiscal year, with frozen shrimp and frozen fish making up over 40% of the value. Government data shows volumes hit an all-time high in 2023–24, with 17.81 lakh MT shipped to top importers including the U.S., EU, UK and China.

Government support amid global headwinds

To cushion the impact of global trade turbulence, the Centre last week approved a ₹4.5 lakh crore support package for labour-intensive export sectors, including textiles, jewellery and seafood, with shrimp receiving special focus.

For Indian exporters navigating U.S. tariffs and volatile global demand, China’s latest ban on Japan could be the unexpected demand bump they need.