Stunning outlook for 2012 Pollock market as seen by Russian Pollock professional
It is common knowledge now that US APO quota has not been taken - the first time in many years. This is an important fact of many consequences. We could say a lot about correct quota setting, fishery sustainability, etc. but here we mention just raw material shortage this year, a Russian Pollock specialist told http://www.megafishnet.com/.
Not all analysts have realized that slow pollock catch delayed start of hake fishery and there is no chance the quota will be taken fully. So, 50% quota increase will be left in water too.
The next fact is that there are no free Pollock fillet blocks or surimi at the market. Nothing. Some big producers have advised their customers that their contracts will not be honored because of fishing conditions. It was really unexpected as this year PBO blocks production was 72% higher than in 2010. Production of the other kinds of fillet increased too.
The Japanese earthquake and tsunami disaster delayed Japanese surimi deals. All the suppliers readily recognized the force major situation, but they had to sell their product. Pollock surimi production increased 42% in comparison with 2010. However, when Japanese buyers decided to start purchasing it turned out that there is no free product at the market. All the increased volume has been taken by American and European buyers, and Japanese warehouses are actually empty. We expect Japanese surimi buyers will start negotiations for A-season very soon (if they have not yet). It will surely shift production programs of key American producers from blocks to surimi.
Yes, I forgot to mention that next year APO quota in US will surely go down. Experts argue - to 1000 or 1100 th.MT. Russian quota in most productive Sea of Okhotsk will also go down. The Russian quota in Sea of Bering has been increased, but fishermen really doubt if it will be taken.
Tilapia fillets and pangasius fillets and blocks took a certain niche in Europe recently. We should realize that fillet and blocks are separate market segments. As for panga, it recently was heavily criticized in Germany, and it loses market very rapidly.
Northern blue whiting didn't exist at the market this year. 2012 quota is reasonable in size, but almost all the catch will surely go WR to Nigeria. Some will be processed into fillets for Chinese domestic market.
Russian pollock will definitely not receive MSC certificate before April. It is the earliest possible time according to MSC schedule. The certificate will cover all A-season fish (providing trampers are provided MSC chain of custody certificate).
The above mentioned facts give the following conclusions and assumptions:
- US TAC-2012 will be decreased to 1.0-1.2 MT
- Surimi demand will grow up, surimi price will go up too
- There will be serious shortage of MSC-certified whitefish. Buyers have no way out but to trust that Russian blocks get the certificate
- Price for all kinds of fillet blocks (US, Russian, Chinese) will go up
- Though Chinese processing is becoming more and more expensive, next year there will be a chance to keep average price for pollock HG $1500-1600
- Chinese processing crisis caused by permanent cost growth against the background of fixed prices of raw material and product will not cease to exist, but the industry receives one year postponement
- HG price will drop on the Chinese New Year (as usual). This year it will be January, 23, so we can well believe that price-2012 will grow up.
It is difficult to estimate pollock roe market. It will really depend on sacks size and actual quality. Everybody was impressed with results of recent Seattle auction, but it is a second-rate indicator of quality and quantity.