Progress and outlook for Fish and Seafood Export from Russian Far East in February 2011

February 16, 2011 11:08
New Year festivals in China, Korea and Japan are over, and though factories will start working at full capacity in March the earliest, the trade is slowly becoming active.  As soon as managers return from vacations, buyers show more interest to new supplies with the main developments having to do with Pollock HG, Pollock roe, Pollock milts, fishmeal, herring and crabs.

Negotiations on APO HG, major winter product from Russian Far East, started after two weeks break, and large supply caused price drop from $1,350 to $1,200 plus.  Exporters race each other proposing the fish as everybody knows that delay in sales will cause putting product to BWT, cash flow will slow down.  After all, APO fishery is the main season for most companies at Far East.

Pollock milts are becoming more profitable every year.  Market of them is very limited - almost everything is consumed in Korea.  Just two or three years ago usual price CFR Busan was $1.00 - $1.40 per kilo, and there was no growing trend.  However, when the main milt producers fixed their product for a season, the situation changed dramatically.  The fact that almost all the market turned out to be controlled by just 2 importers pushed the other players to look for new supplies, and importers increased prices.  Those exporters who had not contracted their product in advance today sell at $2.50 - 2.60 for kg.

The first pollock roe auctions were run in February.  The achieved price level was unexpectedly high.  The auctions were not really representative due to small volume, but the market participants hope that American quota increase will not make the prices drop.

Fishmeal sales seriously deteriorated.  China, the major market for the product, just closed Russian fishmeal import.  Actually, the situation is very much the same as a year ago when Russian civil servants didn't prepare necessary documents in time, and fish exporters couldn't export anything because of absence of catch certificates.  Now the reason is very much the same, Russian and Chinese government bodies didn't achieve understanding, and Chinese Ministry of Agriculture doesn't register Russian fishmeal producers.  Quite a usual set of administrative barriers is used.  The fishermen must provide a free trade certificate to confirm their right to sell their product.  No explanation that by law any company is entitled to sell their product or that no organisation is entitled to issue this kind of certificates worked.  The authorities had to find a way to issue such a paper.  The Chinese also require a proof that during fishmeal production no livestock product was used.  What kind of a livestock could be reduced into fishmeal aboard a trawler which has been at sea for half a year?  Maybe a rat, but nobody specially controls each of them.  Chinese inspectors are very strict with HACCP documentation too.  Probably, they know too well a problem with it at their factories.

However, Russian fishmeal cannot be legally imported into China.  The most enterprising buyers deliver fishmeal to Korea - either for stockpiling till better times, or for repacking and re-export with new documents.  Naturally, both variants press the price down.

The rest of herring is been delivered from the fishing ground.  As usual, the season end came unexpectedly for Chinese buyers.  Prices which stuck at below $700 in January soared up and quickly jumped over $800.

Crab exporters are cautiously optimistic.  Full ban on king crab harvest at all major areas and coming ban for blue crab made all the prices to go up.  However, export volume is not large as yet.

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