The global shrimp farming industry stands at a transformative moment. Indoor shrimp farming which began as a cottage industry is rapidly evolving into a sophisticated sector, following the successful trajectory of land-based salmon farming. With total global production projected to reach 5.88 million metric tons in 20241, indoor shrimp farming through Recirculating Aquaculture Systems (RAS) is emerging as a solution to the industry’s most pressing challenges – disease management, environmental impact and fluctuating profitability.
Tropical Shrimp Farming
Tropical shrimp farming is dominated by whiteleg shrimp Litopenaeus vannamei and showcases a clear evolution from extensive to intensive operations, particularly in Latin America and Southeast Asia. This evolution reveals striking efficiency differences: extensive systems, which rely on tidal exchanges and natural feed, occupy 1.1 million hectares (46% of global farming area) yet contribute only 6% of global supply2 while leaving a substantial environmental footprint on coastal ecosystems.
Intensive operations present a different story. While requiring higher initial investment, these systems demonstrate significantly lower environmental impact. Modern intensive farms incorporate sophisticated features including precision aeration, waste management systems, formulated feeds, acoustic feeding technology, enhanced biosecurity measures, and advanced genetics/breeding techniques.
The results speak for themselves: intensive farms achieve yields of 30-60 metric tonnes per hectare in compact 0.2-0.5 ha ponds, dwarfing the 0.5-3 metric tonnes per hectare typical of extensive operations using 5-30 ha ponds3.
Tropical shrimp are a globally traded commodity with the profitability of farming very sensitive to fluctuations in supply and demand in major markets, and to rising energy and feed costs in the intensive sector. Losses to disease also represent a significant challenge and are estimated at US$20 billion over the past decade4, with survival rates in some farms below 60%.
RAS Technology: A New Production Paradigm
Modern RAS technology represents a fundamental shift in shrimp production. After two decades of development, what began as an experimental approach is now emerging as a commercially viable solution. Small-scale operations of 1 – 50 MT are only viable when global shrimp prices are high and/or conditions allow premium pricing for the fresh product and because of the environmental and welfare benefits associated with local production2. Recent advances have halved grow-out times to 90 days while dramatically improving survival rates and production efficiency through automated monitoring and control systems.
Within the RAS space, two distinct approaches have emerged: Clear-Water (CW) and Biofloc (BF) systems. CW systems employ sophisticated external filtration, including UV sterilisation and specialised biofilters, delivering superior environmental control and stability. These systems enable automated handling and clear visual monitoring of stock, supporting consistent product quality without off-flavours. While they require higher initial capital investment, their operational benefits are increasingly recognised by industry leaders.
Biofloc systems, in contrast, utilise microbial communities to supplement shrimp nutrition. While featuring lower initial setup costs, they require intensive aeration to support microbial populations and present more complex management challenges. The limited visibility affects monitoring capabilities, and there’s a risk of off-flavours that can impact product quality. A recent academic study which directly compared BF and CW concluded that the later may be the more productive option with individual shrimp weights, total biomass, and FCR all significantly better than BF systems5. CW systems are increasingly favoured for their superior control, stability, and consistent product quality.
The Strategic Advantages of Indoor Shrimp Farming
Indoor shrimp farming represents a significant leap forward in aquaculture technology, offering compelling advantages over traditional pond-based systems. For companies eyeing the growing demand for premium, sustainably sourced seafood, the benefits are particularly attractive:
Market Access and Product Quality
Indoor operations can be strategically located near urban markets, dramatically reducing transportation costs and time to market. This proximity enables producers to offer genuinely fresh shrimp to consumers within 24 hours of harvest – a significant competitive advantage in premium markets, particularly in the Northern Hemisphere. Even for frozen products, the shortened cold chain results in superior quality.
Environmental and Health Benefits
These systems set new standards for sustainable aquaculture:
- Dramatically reduced land and water usage compared to traditional ponds
- Elimination of antibiotics and pesticides
- Enhanced biosecurity leading to survival rates above 90%
- Zero discharge of pollutants into local ecosystems
Operational Excellence
Modern indoor farms offer unprecedented control over production:
- Year-round harvesting capability, ensuring consistent market supply
- Integration of renewable energy sources, reducing operational costs and carbon footprint
- Automated monitoring and control systems for optimal growing conditions and lower labour costs.
The combination of these advantages positions indoor shrimp farming as a solution to the industry’s longstanding challenges of disease control, environmental impact, and production sustainability. More importantly, it creates opportunities for producers to capture premium market segments with high-quality, sustainably produced shrimp.
Leading Innovators in Indoor Shrimp Farming
The indoor shrimp farming sector is experiencing rapid evolution, with several companies emerging as pioneers in different markets. Here’s how the landscape is taking shape:
North American Innovation
CP Foods has made a strategic move into the U.S. market with its “Homegrown Shrimp” facility in Indiantown, Florida, while AQUABANQ is pursuing ambitious expansion plans across North America. These investments signal growing confidence in the market potential for locally produced premium shrimp.
CP Foods update 16th Jan 2025:
CP Foods announces withdrawal from the US retail market for Homegrown shrimp its 160 MT indoor farm in Florida. The facility which has a production of 160 MT will in future focus on genetic improvement and the selling of broodstock. The reason given for this shift in strategy is the unwillingness of consumers to pay the prices needed to make a profit given current operating costs which has resulted in unsold product due to competition from imports. Source Intrafish7.
This news is not particularly surprising as 160 MT is not of a sufficient scale to achieve farming costs that are competitive with traditional shrimp fisheries. It also confirms the view that reaching parity in production costs is essential for commercial viability.
European Leadership
Europe is seeing particularly dynamic development:
Oceanloop (Germany) has forged strategic partnerships with Crusta Nova (now Honest Catch) and Neomar, operating facilities in Munich and Kiel. Their ambitious growth plans target 2,000 MT production by 2027.
Novaton (Switzerland) is establishing itself as a turnkey RAS provider, with successful implementations in Morocco and Saudi Arabia.
In the UK, FlowGrow and Three-Sixty Aquaculture have secured funding to scale their pilot plants, aiming for 2,000 MT of sushi-grade production annually.
Technological Advancement
The indoor shrimp farming sector is seeing diverse technological approaches emerge. Vertical Oceans (Singapore) has pioneered a distinctive multi-trophic system that integrates macroalgae as a key component of biofiltration, moving beyond traditional single-species intensive systems. This innovative approach combines AI integration and automated systems with ecological principles, demonstrating how aquaculture can evolve beyond conventional production methods.
Meanwhile, Lisaqua (France) is advancing automation and control systems for traditional RAS setups. These industry leaders are demonstrating that indoor shrimp farming can be both technologically feasible and economically viable, while taking different paths to sustainability and efficiency.
Market Opportunity: Meeting Premium Demand
The market landscape presents compelling opportunities for indoor shrimp farming, particularly in high-value regions. The United States alone imported nearly 800,000 MT of shrimp in 2023, valued at approximately £114 million6. Similar opportunities exist in the EU and UK markets, while Asian urban centres present even broader potential for growth. Indoor shrimp farms, especially those offering sustainably farmed, locally produced fresh shrimp, are well-positioned to tap into these growing markets.
As consumer demand shifts toward sustainably sourced, high-quality products, the ability to market shrimp based on their environmental credentials—such as reduced water and land usage and the elimination of antibiotics—will provide a significant competitive advantage. The ESG story around land-based shrimp production is particularly strong given the damaging environmental impacts of traditional farms in relation to land and water use, disease, poor welfare and pollution.
Oceanloop claim that the global warming potential (GWP) of a tonne of shrimp farmed in their facility is up to 77 per cent lower than for open pond farms and uses up to 49 per cent less land and up to 96 per cent less water, all with the help of 100 percent renewable energy sources such as solar and wind power.
Companies that align their operations with these trends are likely to see both market share growth and premium pricing.
Critical Success Factors
The next decade will be decisive for indoor shrimp farming. Success hinges on several critical factors. First, standardisation of facility design and husbandry methods needs to provide certainty around capital and operating expenses, as well as profitability metrics. Production costs must become competitive with traditional shrimp farms at around €25-30/kg, as premium pricing opportunities will likely decrease as the market matures.
The industry must also determine optimal facility sizes – whether that’s 2,000 MT, 10,000 MT, or beyond – while developing robust supply chains for equipment, feed, and genetics.
Once these conditions are realised the investment taps are likely to be fully opened allowing the sector to really take off and make a meaningful contribution to global supply and food security for individual countries.
Companies best positioned for success typically fall into five categories:
- Technology Innovators
Companies that specialise in highly efficient, automated RAS systems with low capital expenditure and operational costs. These systems should also ensure superior shrimp welfare and product quality.
- Genetics Pioneers
Organisations focusing on developing RAS-optimised broodstock, shifting from traditional pathogen resistance to traits like faster growth rates and improved feed conversion ratios.
- Sustainability Leaders
Companies that can forge partnerships with retailers and leverage sustainability credentials to gain competitive edge in an increasingly environmentally conscious market.
- Entrepreneurial Firms
Businesses that focus on local, sustainable production and the circular economy, tapping into growing trends toward reimagining the seafood industry in developed countries.
- Strategic Collaborators
Companies that build partnerships with local feed suppliers, governments, and technology providers to secure a more sustainable and cost-effective supply chain.
Genetics: The Next Frontier
The role of genetics in indoor shrimp farming extends far beyond traditional breeding goals. While conventional programs focused primarily on disease resistance for open-pond systems, RAS environments present new opportunities and priorities. Next-generation breeding objectives include accelerated growth rates, improved feed conversion efficiency, enhanced stress tolerance in controlled environments, and optimisation for high-density production.
Strategic genetic improvement could provide the competitive edge needed as the sector matures, particularly in addressing rising feed costs and operational efficiency.
Xelect specialise in genetic improvement and there is significant potential to contribute to the scale-up of indoor shrimp farming. Collaboration between genetics specialists and leading RAS operators is already yielding substantial benefits in terms of genetic optimisation for growth, stress tolerance, and feed efficiency.
The Path Forward
Indoor shrimp farming stands at an inflection point. The convergence of advanced technology, sustainable practices, and growing demand for premium seafood creates unprecedented opportunities. Success in the next 5-10 years will belong to companies that can:
- Scale efficiently while maintaining product quality
- Leverage technology for operational excellence
- Demonstrate clear sustainability credentials
- Build strong market relationships
- Optimise genetics for indoor production
For stakeholders in aquaculture, the time to act is now. The indoor shrimp farming sector is rapidly evolving from promising technology to commercial reality. Those who move decisively – combining technological innovation, genetic advancement, and sustainable practices – will help shape the future of global seafood production.
The transformation of shrimp farming from traditional pond systems to high-tech indoor facilities represents more than just technological advancement – it’s a fundamental reimagining of how we can produce seafood more sustainably, efficiently, and profitably.
For more information about how your organisation can participate in this emerging opportunity, contact us at info@xelect.co.uk.
References
3. Boyd, C.E. and A.A. McNevin. (2017). Land use in shrimp aquaculture. World Aquaculture 49 (1) pp. 28-34.
4. Far Eastern Agriculture. (2016, September 22). “Disease costs Asian shrimp sector US$20bn.” Retrieved from
6. US Shrimp Imports 2023
https://www.fao.org/in-action/globefish/news-events/news/news-detail/us-shrimp-imports-declined–in-2023/en#:~:text=Total%20import%20quantity%20in%202023,been%20at%20a%20record%20low.
