Brief overview of the Russian hake market and forecast for 2007. Full story.
In the recent five years hake has been one of the most popular species on the Russian market along with Alaska pollock and cod. Those species are the most highly liquid and basiс for trade operations for a lot of wholesalers. Continuously growing demand for such fish secures stable wholesale volumes.
According to sources in the trade, in the year 2006 the Russian hake market exceeded 34,000 tonnes with two Russian companies OOO REAL (ltd) and JSC ZAO Tunaycha Company coming forward as the main suppliers of hake on the domestic market.
In particular, the Russian seafood importer OOO REAL (ltd) has been supplying head-off tail-off hake onto the Russian market from the USA, Canada, Argentine, etc. for a number of years.
Since 2000 when it was established REAL has developed into one of Russia's largest importers supplying a wide range of seafood items. The assortment offered by the company includes pelagic fish, chilled and frozen Atlantic salmon from Norway and Chile, Pacific salmon, fillets of various fish species from Vietnam and China, Latin America.
In order to strengthen its leading position on the Russian frozen fish market, on top of imported products, REAL signed a big contract for Russian-processed hake in the year 2006. Together with the Russian fishing company JSC ZAO Magellan klondiking for hake in the Canadian EEZ REAL shipped to Russia 8000 tonnes of head-off tail-off hake of the size 300-500 and 400-600. Taking into account consumer preferences as regards fish quality and packaging, the company supplied products in traditional 22-kilo cartons containing two 11-kilo blocks.
According to the company, the HGT product has a good response on the Russian market as it looks nice with the abdominal cavity lined with dark-grey film which is easily removed and the belly walls being thin. The fish body is covered with small tightly sitting scales. The flesh is firm and cream coloured and keeps water well. There are no intermuscular bones.
Value-added processing carried out at sea onboard modern trawlers helps provide high quality and attractive appearance, the company says.
At present REAL has got the exclusive right to sell the Pacific hake of the Russian origin all over Russia and CIS. With the volume of hake shipments growing from 5000 to 18,000 tonnes, the company has won ca.50% of the Russian hake market.
According to the forecasts of REAL's analytical group, in the year 2007 the harvest of Pacific hake can substantially decrease. It would be attributed to large catches of hake since 1999 with the harvest of the species already exceeding the resource potential. The reason behind the expected stock decrease has to do with lack of strong young classes.
At the same time, taking into account the information provided by the Argentinean National institute for fishery research, the company's analytics doubt in good outlook for Argentinean hake fishery and think that it will take several years for the Argentinean stocks to improve to the level sustainable for fishery.
On the threshold of the new season 2007 prices for raw hake w/r and HGT hake have already started to form on the market. As per late May 2007, the cost price of head-off tail-off Pacific hake from the future harvest 2007 is forecasted to amount to more than RUR55.00, while a similar product from Argentinean hake will be priced higher at more than RUR63.00 per kilo. Besides, traders have to take into account the condition of 100% advance payment as contracted with the US and Canadian producers.
Thus, the situation with the hake shipments in 2007 considerably darkens prospects for whitefish sales and will have noticeable consequences for the Russian market of cod family fishes.