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Welcome to The Tradex Foods "3-Minute Market Insight"
A fast facts to start your week...
------2012 Troll King salmon fishing is gaining momentum leaving buyers looking for price
relief.
There have been spot openings to date for troll King salmon with prices to wholesalers
at $8.00-$9.00 per lb.
Alaska Troll King fishing re-opened May 1st along with California, Washington and British
Columbia.
As reported previously Oregon troll King fishing is already under way.
It is expected that as production increase prices will soften, however at this point
processors report mediocre harvests.
Distributor prices ranged between $8.00 and $8.50 by the end of last week.
------In roughly 2 weeks the 2012 Copper River sockeye season will begin near Cordova Alaska.
The Copper river sockeye have long been prized for their exceptionally high quality and have
yielded some of the highest Wild salmon prices in Alaska.
The fish have a very high oil content and are processed with the highest attention to
quality.
According to local sources in Cordova there may be a delay in the opening as the river
is frozen over and the Alaska Department Fish and Game fish counters are covered by a layer
of ice.
Fishing is determined by ADFG monitored escapements and a frozen river may delay opening the fishery.
Given current economic conditions will the 2012 Copper river fish be met with all the
fanfare of previous Years?
Helicopters and fixed wing aircraft have in the past transported fish from the the fishing
grounds to Cordova for immediate delivery to Seattle and other major markets with prices
nearing $20 per lb.
ADFG forecasts a run of 2.15 million copper river sockeye for 2012, and an expected harvest
of 1,430,000 fish.
------Now a little on Halibut inventories...
There continues to be a huge price gap between 2012 halibut and remaining 2011 inventory.
It should translate that 2011 inventory priced at or below current grounds prices should
be moving briskly.
However expensive 2011 halibut inventory is still moving slowly and is a growing concern
for many packers and inventory companies.
Grounds prices in Canada for 10-20 lb. fish is $7.20 with Alaska pricing sitting at $6.25.
------Some news out of China...
More troubled times are ahead for Tilapia farmers and processors in China.
Up to 30 percent of the Tilapia farmers in China have not and will not be re-stocking
their ponds with new fry.
The poor market conditions have made farming for many processors unsustainable.
Processors advised that economic pressures are considerable as is disease.
With up to 50 percent of Tilapia dying during summer months from Streptococcus bacterial
outbreaks, farmers have chosen to deplete current stocks and re-stock with a different
species.
There is no effective vaccine available to prevent streptococcus.
Antibiotic treatments are only partially effective and antibiotic residue would make product
unacceptable for food markets.
Outbreaks usually occur when fish are subjected to changing water temperatures, in China this
is July to September.
Farmers and processors are now preparing to stock one of the domestically consumed fresh
water aquaculture species.
These species include 6 varieties of carp, Eel, shrimp and turtle.
Tilapia currently accounts for roughly 4 percent of aquaculture in China while carp for instance
accounts for 75 percent.
This is aquaculture for domestic China sales.
Farmers see growth potential in Eel farming which is currently only 1 percent of Chinese
aquaculture production.
When looking at this situation globally, buyers should expect considerable changes by summer
of 2012.
The drop in Tilapia production when added to Vietnamese Pangasius output falling as
processors struggle to raise hundreds of billions of VND to offset the tens of billions of VND
shortage created by the banks lending strategy will likely lead to either shortages or higher
prices moving forward.
------Chinese salmon processors are reporting extremely high inventory levels of Chum slamon
at costs that are considerably over market prices.
The European Seafood Exposition did not stimulate the salmon business processors were targeting
and it has left many processors with few outlets remaining for their product.
One processor we spoke to reported they have 5,000 tonnes of raw material that is uncommitted.
We canvassed several chum processors in China to gain perspective on the market pricing
but were left with the impression that there is no concrete market on this product.
Prices for same specification products had a variance of $0.70 per lb.
It is a buyers market on chum salmon and as an inventory speculator this is one species
that should be handled very carefully.
The 2012 Chum season is approaching quickly.
With hundreds of thousands of pounds still in North America unsold and millions of pounds
in China unsold, it will likely be a very challenging year for Chum salmon harvesters
in processors in North America.
It is apparent that Alaskan processors have a plan of their own as two confirmed hatchery
bids were accepted in Alaska at $1.62 and $1.65 for round fish to be harvested in June,
$0.50 per lb higher than last year.
Finished H&G prices will be around $2.25 based on this pricing.
The answer has to be in the roe and as the Japanese Ikura market is lack lustre processors
must be looking to other foreign roe markets to justify this pricing.
------Thank you for joining me for the Tradex Foods
"3-Minute Market Insight" This is Robert Reierson - “BUY SMART”
and “EAT MORE SEAFOOD”