Dynamics and trends of Russia's seafood market capacity

August 29, 2008 16:30

In 2007 Russia's seafood market showed a further growth of supplies, the consumption capacity satisfied both by domestic production and importation. At the same time, the share of imported products on the domestic market decreased which was compensated by dwindling exports, www.fishnet-russia.com (www.fishnet.ru) reports with reference to Promyshlennyi Vestnik Info.

Main indices of Russia's food fish market, million metric tons

 -

1991

1995

2000

2005

2006

2007

Food fish production, canned inclusive

3.67

2.56

3.14

2.93

2.97

3.11

Fish exports

0.45

1.10

1.20

1.37

1.26

1.14

Fish imports

0.23

0.27

0.47

1.00

0.85

0.71

Domestic market capacity

3.45

1.73

2.41

2.56

2.56

2.68

Share of imported fish products on the domestic market, %

6.6

15.6

19.5

39.1

33.2

26.5

In 2000-2007 the structure of the Russian export of fish products was changing not for better. Russian exporters shipped much less live, fresh and chilled fish and fish fillets.

Against the above background the share of export shipments of frozen fish jumped more than by 15%. In that period the average export price per one tonne of live, fresh, and chilled fish tripled from 720 USD to 2160 USD. Prices per one tonne of fish fillets grew 1.9-fold from 1610 USD to 2980 USD, while prices per tonne of frozen fish increased by 32% from 1040 USD to 1360 USD. Export shipments of canned fish and fish roe in 2000-2007 grew by 25%, but the average export prices per tonne of those products decreased by 18% from 2670 USD to 2180 USD. Unfavorable changes in the structure of Russia's seafood export resulted into a slow growth of its value. In the period under the analysis the nation's seafood export was annually increasing by 4.4% only. The domestic supply was incompliant with strengthening solvent demand. Large seafood import in volume terms could be attributed to a lack of internal supply.

Dynamics of average export/import prices on Russia's fish market in 1000 USD per tonne

-

2000

2006

2007

2007 versus 2000, %

Average prices - export/import

1.27/0.48

1.56/1.57

1.71/1.84

134.6/383.3

Live, fresh and chilled fish

0.72/0.48

2.00/3.75

2.16/4.58

300.0/954.2

Frozen fish

1.04/0.37

1.26/1.22

1.36/1.30

130.8/351.4

Fish fillets

1.61/0.67

3.35/2.06

2.98/1.90

185.1/283.6

Dry cured fish, dried and smoked fish

0.89/042

3.28/2.17

3.53/2.17

396.6/516.7

Shellfish products

4.82/0.47

7.67/2.56

9.73/2.76

201.8/587.2

Molluscs products

2.10/1.50

3.29/2.21

2.97/2.02

141.4/134.7

Canned fish, fish roe

2.67/0.30

1.84/1.43

2.18/1.55

81.6/516.7

Canned shellfish and molluscs

6.13/1.22

8.43/4.10

7.08/4.48

115.5/367.2

Russia's statistics data proves the country's strong dependence on seafood imports. The price policy in the nation's fish trade is peculiar for the fact that on the domestic market wholesale and especially retail prices are used to be set too high (spread), while foreign exporters will normally sell at low prices (dumping) in order to speed up sales. Experts say Russian exporters ship to the international markets more valuable food products such as cod, ocean perch, sockeye, Alaska pollock, shellfish, etc., while the nation's importers normally purchase less valuable products enjoying strong demand at home, such as Baltic herring, capelin, sardine, herring, blue whiting, etc. The thing is that in Russia retail prices of many seafood products are much higher than meat prices. The high prices can be explained by the long way of the product (often re-exported) to the consumer going through various intermediaries, and also by high transport tariffs and monopolization trends. Under such conditions experts think that import of cheap seafood strongly demanded by Russians with small and medium income has a positive influence for the market saturation. Stable volumes of shipments have been maintained first of all by steady growth of prices of main seafood products.

In 2000-2007 import prices increased 9.5-fold for live, fresh and chilled fish, 3.5-fold for frozen fish, 2.8-fold for fish fillets, 5.2-fold for dry cured, dried, salted and smoked fish, 5.9-fold for shellfish, 1.3-fold for mollusks, 5.2-fold for canned fish and fish roe, 2.7-fold for canned shellfish and mollusks. In the period under analysis the growth rates of import prices were much higher than those of export prices, namely amounting to 383.3% and 134.5%. In 2006 the average prices reached 1570 USD per imported tonne and 1560 USD per exported tonne, while in 2007 the figures rose to 1840 USD and 1710 USD respectively. The average import and export prices of frozen fish came close to each other with the indices for 2006 amounting to 1200 USD and 1260 USD correspondingly (1300 USD and 1360 USD in 2007).

In March 2008 the average import prices per tonne of fresh and frozen fish (according to Russia's Federal Service of State Statistics) jumped by 16.1% and reached 1690 USD. In the same period average export prices per tonne of the same products grew by 9% to 1590 USD. Convergence of average import and export prices softens longstanding opposition of seafood importers and exporters and shows that the domestic market has been growing attractive for the Russian companies, which have been earlier focusing only on export shipments. The above development has highlighted a problem of import substitution of fish products. As compared to 2006, in 2007 with a slight decrease of value (-0.8%) export of food fish in volume decreased by 9%, while import went down by 16%.

According to experts, the decrease of seafood export volume encouraged greater saturation of the domestic market. In general the structure of the Russian market changed progressively. The total volume of purchases in 2000-2007 contained a considerably increased share of live, fresh and chilled fish, fish fillets, and shrimps. At the same time, the frozen fish segment slightly decreased in volume terms. In the period under analysis import of fillets in natural figures jumped 10 times, shellfish - 6 times, mollusks (mostly shrimps) - 22 times.

Dynamics of finfish and shellfish production in Russia in 2008

-

I quarter 2008 versus I quarter 2007, %

January-April 2008 versus January-April 2007, %

-

I quarter 2008 versus I quarter 2007, %

January-April 2008 versus January-April 2007, %

Live fish

137.2

123.2

Dry cured fish

106.5

108.0

Chilled fish

180.3

139.7

Spice salted fish and pickled fish (less herring)

95.6

101.0

Frozen fish

98.6

101.3

Ready-to-eat fish

179.0

153.1

Special cut fish

148.2

156.0

Balyk-style fish

108.1

112.0

Frozen fillets

155.4

148.6

Fish mince

187.8

187.4

Salted fish (less herring)

135.9

128.5

Fish roe

109.9

113.3

Herring, all types of processing

142.6

94.7

Other than finfish aquatic products

117.5

123.8

Smoked fish

115.8

117.9

Canned fish and marinated finfish and other aquatic products

140.0

134.6

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