Business Standard reports that the price of vannamei shrimp which is exported to the US and Europe is especially going down because of a glut in production.
Another reason prices are dropping is alleged cartelisation practices among local exporters to avoid competition from other producers in the country.
At present, Andhra Pradesh's vannamei shrimp farmers get Rs 240 per kg of 40 count at a time while exporters in Tamil Nadu pay Rs 340 for the same. A month ago, prices were at Rs 320 per kg in the state, said I P R Mohan Raju, president of the Prawn Farmers Federation of India.
In 2012, the state's farmers produced 160,000 tonnes of vanamei shrimp whereas this year, production rose at 200,000 tonnes.
States like Tamil Nadu, Odisha, Gujarat, West Bengal, Kerala and Maharashtra are offering rates based on international prices, while exporters from Andhra Pradesh pay very low rates and enjoy huge margins on shrimp exports, Mr Raju added.
Mr Raju said: "Notwithstanding the irregularities by state exporters, we have made an oral complaint on the cartel prevailing among the Andhra seafood exporters to the monopoly trade practice restriction body and the Marine Products Exports Development Agency (Mpeda)."
Mr Raju said that majority of Andhra Pradesh's shrimp processing and cold storage units are owned by big exporters who exploit farmers by capitalising on their dependency on harvesting and the exporters' processing plants.
However, to overcome this exploitation, the Prawn Farmers Federation of India has recently proposed to set up 1.5 tonne per hour capacity mobile shrimp processing units in coastal areas.
"The National Fisheries Development Board has appreciated our efforts and agreed to give 40 per cent subsidy on the project cost," Mr Raju said.
D B Ravi Reddy, president of the Seafood Exports Association of India, denied the allegations against the exporters by the Prawn Farmers Federation of India.
Mr Reddy said: "Due to over production, the farmers in Andhra Pradesh are coming forward to sell their produce at lower prices. Normally, exporters offer rates according to the prevailing international prices."
While Tamil Nadu exports its shrimp to Japan where prices are usually high in comparison to the US and Europe, exporters in Andhra Pradesh largely send their produce to the US and European markets.