Overview of seafood exports from Russian Far East in January - April 2008 reveals big changes in market patterns
In the first quarter of 2008 the fishery in the Russian Far East was focused on Alaska pollock generating large flows of pollock roe, fillets and headed&gutted products both the domestic and foreign markets.
According to some estimates, the roe pollock fishery in the event of strong prices on frozen roe will contribute up to 50% of sales income of some companies on yearly basis. This conclusion has been made by analysts of http://www.fishnet-russia.com/ (https://www.fishnet.ru/) based on the reports of the Russian and Japanese seafood media sources.
The situation with crab fishery, which has come under tighter state control, has also been observed with keen interest by foreign market players. The thing is that till autumn later this year, quotas for commercial crab fishery in the main fishing area of West Kamchatka, will not be allocated what may have a negative effect on the American and Japanese markets.
Alaska pollock roe
The Alaska pollock fishery in the Sea of Okhotsk in January- 10 April 2008 was first complicated by severe ice conditions in the Northern part of the Sea. Moreover, later a large number of mostly Sakhalin and Primoriye-based fishing companies suffered from numerous arrests of vessel over controversial interpretation of pollock roe yield. Those two developments seem to be the key factors to predetermine the results of the fishing season. More specifically, over 12% of the total APO quota of 700,000 tonnes remained unexploited (about 86,500 tonnes of quotas) the total catch amounting to 610,000 tonnes.
The above figure is nearly 130 tonnes up on 2007, though the resulting roe production still failed to compensate for the reduced output in the USA.
In Alaska the reduction of the quotas for A season (to 400,000 tonnes) led to the subsequent decrease of Alaska pollock roe production to less than 18,300 tonnes (8,500 tonnes down from the year 2007).
In the event of full quota take-up in Russia, the roe production could have amounted to more than 31,000 tonnes (that would have meant an increase 8,000 - 10,000 tonnes even with the roe yield limited to 4.5%) but the actual Russian roe production reached only 24,000 tonnes.
In this situation, the total supply of Russian and American roe to Japanese, South Korean and Chinese markets amounted to 42,000 - 43,000 tonnes (in comparison with 48,000 - 50,000 tonnes in 2007.).
Meanwhile, at the auction in Seattle the average selling price for two rounds increased by Y200 per kilo and reached Y1300 per kilo. It is assumed that this soaring of prices combined with decreased production in Alaska and the failed expectations of increased production in Russia have become the main factors of a serious price rise of the Russian roe.
Approximately 14,000 tonnes of Russian roe of season 2008 have been sold at the auctions of Busan by the beginning of May and 3,000 tonnes more have been sold outside the auction. Thus, total sales of Russian frozen roe reached 17,000 tonnes with 7,000 tonnes left to be sold during the rest of May 2008.
April and March auctions in Busan have been marked by increasing prices. High prices in March could be explained by strengthening of Yen against US dollar but in April the fluctuation of prices was triggered by some other factors.
From middle to end of March the prices varied from USD12 to USD13 per kilo and in April the prices reached the level of USD13 - USD14 per kilo although the Yen rate and the quality of overmature roe in skeins was gradually slackening.
Non-auction selling prices reached the level of USD14.50 per kilo, according to some sources, but this price had no official confirmation and so should be treated cautiously by market specialists.
According to some estimates, average selling prices of Russian roe of more or less high quality (from Japanese market requirements point of view) in the results of the current season can come close to USD13 per kilo, up nearly USD3 per kilo from the previous year.
Active sales of Russian roe to South Korea, China and Japan started in March 2008. More specifically, South Korean roe import volume amounted to 300 tonnes at an average price of USD7.50 per kilo (CIF terms), down 15% in terms of volume and up 20% (up USD1.10) in terms of average price from the preceding year level.
On the whole, the first quarter was not marked by serious changes in comparison with the same period of the year 2007. Import volume reached 700 tonnes and the average price came close to USD7.20 per kilo.
In March 2008 export volume to China more than doubled exceeding 300 tonnes. Average export price to China slightly exceeded the level of USD7.50 per kilo (CIF terms), up 220% from the previous year price.
Notably, as compared with the same period last year, in the first quarter 2008 the export volume of roe to China decreased by 25% to 600 tonnes while the average export price increased by more than 10% amounting to nearly USD8.30 per kilo.
Supplies to Japan in March 2008 amounted to nearly 300 tonnes, falling by more than 60%. The average import price did not exceed the level of approximately Y1000 per kilo. In contrast with Chinese and South Korean increased prices, the import price in Japan fell by nearly 10%.
Total Alaska pollock frozen roe export volume to Japan in the first quarter of 2008 reached 850 tonnes, down one third from 2007 level. Average import price fell down by nearly 5%, amounting to nearly Y920 per kilo.
Frozen Alaska Pollock
In the first quarter of 2008 supplies to China of Russian frozen Alaska pollock decreased. In March 2008 the export volume reached less than 35,500 tonnes, down 20,500 tonnes from 2007 level.
In the first quarter 2008 the total Chinese import of Russian frozen APO products (likely to include cod and other close species) did not exceed the level of 96,000 tonnes, falling nearly 10% (10,000 tonnes) as compared the same period last year.
The prices did not move upwards, however, and the average import price in the first quarter 2008 amounted to USD1.60 per kilo, down 5% from the preceding year.
It is notable that the decreasing of supplies to China has continued for two years now and in the situation of quotas increase it may mean that the Russian producers have been gradually switching to other markets (including the domestic one).
Supplies to Japan of Russian live king crab fell drastically in the first quarter of 2008 as well as the supply of Russian origin crabs on the whole. In March 2008 export volume to Japan amounted to a mere 55 tonnes, down nearly 4 times from the February 2008 level.
The total crab shipments in the first quarter of 2008 were reduced by 60% amounting to less than 450 tonnes (including blue crab supplies). Average import price in the first quarter amounted to Y780 per kilo, up less than Y70 per kilo (this price level was mainly triggered by incredibly low prices (up to Y450 per kilo) of March supplies of mostly small-sized crab).
In March the supplies of live snow crab of Russian origin more than tripled as compared to February 2008 and amounted to about 500 tonnes, down 30% from the previous year figure of more than 700 tonnes.
The total Japanese import of this product from Russia fell by more than 10% in the first quarter 2008, to nearly 1800 tonnes. Average import price of live snow crab amounted to nearly Y425 per kilo, down more than 10%.
The frozen crab import from Russia also fell drastically, the fact being indicative of a reduced scale of fishery in the beginning of 2008.
In March sales to Japan of frozen king crab and blue king crab were more active in comparison with 2007 level and amounted to nearly 475 tonnes. However, the import volume in the first quarter 2008 reached about 2100 tonnes, down 1200 tonnes or 67% on the same period last year.
In this situation prices were more favourable for Russian producers. Average import price in March 2008 crossed the level of Y1900 per kilo (this corresponds to average import price from Norway), up almost Y240/kg (up USD2 per kilo) from the February 2008 and up almost Y800/kg (70%) from the previous year period. Average import price in the first quarter 2008 by the end of March amounted to Y1680 per kilo, up Y600/kg or 53%.
Import of frozen snow crab to Japan was not marked by huge activity. Import volume in March amounted to slightly more than 150 tonnes and total import in the first quarter fell by nearly 30% to 625 tonnes, with average import price up 9% in the first quarter (Y1000 per kilo).
Chinese import of frozen crab from Russia has notably decreased as well. Import volume in March 2008 were slashed by 87% to 250 tonnes only in comparison with 2007 level. Total supplies of crab (mainly snow crab) to China decreased by more than 60% to 1.65 thousand tonnes. Average import price, although relatively low, increased by 30% (about USD3.20 per kilo).