Saving Seafood

Chinese tariffs challenge Alaska seafood, new markets emerge

February 27, 2019 — Alaska’s fishing industry provides more jobs than any private sector in the state. On Tuesday, the House Special Committee on Fisheries received an update from the Alaska Seafood Marketing Institute.

The tariff war with China remains a concern. The Alaska Seafood Marketing Institute put a lot of effort into selling Alaska’s seafood to China, said Jeremy Woodrow, the interim executive director of the ASMI. For every $10,000 spent on marketing in China, the Alaska seafood industry gets $1 million. But with the tariff war between the U.S. and China, Woodrow said, “We are expecting big drop offs in our Chinese market.”

However, Woodrow had plenty of positive news to report. In December, U.S. Sen. Dan Sullivan was able to add a provision to the Farm Bill that would require Alaska seafood pollock to be used in fish sticks in American school lunches. Previously, fish sticks in American school lunches were comprised of Russian pollock. Woodrow said this would equate to about $30 million a year. Alaska pollock makes up the bulk of the Alaska’s fishing harvest volume: 57 percent of the 5.9 billion pounds of seafood harvested in a year.

Ukraine has been a growing market for Alaska seafoods ever since the Russians placed an embargo on U.S. fish about five years ago, Woodrow said this market has been steadily growing.

Read the full story at the Juneau Empire

Stand-off mounts in Russia between crab sector and government

February 21, 2019 — A fight between Russia’s crab fishing sector at the Russian government has escalated after two damaging reports aired on national television and the government initiated a public investigation into crab magnate Oleg Khan.

Russian President Vladimir Putin has proposed reallocating 50 percent of Russia’s crab quota via an auction system. The proposal has generated an uproar in Russia’s seafood industry, with some industry representatives calling the proposal potentially disastrous.

In December, separate reports by television stations Russia and NTV aired investigative reports alleging serious issues related to illegal, underreported, and unregulated (IUU) fishing in Russia’s crab fisheries. Both stations editorialized that only a shift to auctions would stifle the illegal activity that they said had become rampant in the industry.

In its report, NTV, a private channel owned by Gazprom Media holding, the media body of the mainly state-owned conglomerate Gazprom, accused the Russian crab industry of fishing beyond its quotas, and of illegally exporting the illegally-caught crab to South Korea and Japan. They criticized authorities in South Korean and Japanese ports for not doing their best to prevent illegal import of Russian crab, alleging they often turn a blind eye on improperly filed papers.

Read the full story at Seafood Source

How Trump’s trade war kept Russian fish sticks in US school lunchrooms

February 11, 2019 — A trade decision by the Trump administration has inadvertently protected a price advantage enjoyed by Russian-caught fish sold in the US, much of which ends up in fish sticks served to American school children.

For years, Alaskan fishermen have been frustrated by foreign competition from Russia, particularly in the lucrative pollock market. Caught in Russian waters, this cold-water cousin of the cod is processed in China before being sold in the US for use in frozen and breaded fish products, as well as imitation crab meat.

Russian pollock costs less than its US-caught equivalent. That’s helped it gain share of the roughly $200 million US market for frozen pollock, to the point that by 2017, about half the fish sticks served in US school cafeterias were made from fish caught in Russia and pumped with additives in China, according to the Genuine Alaska Pollock Producers, a trade group that represents 14 different seafood companies.

Domestic fish producers thought President Donald Trump would fix all that. The administration’s move to slap a 10% tariff last year on thousands of imports from China was supposed to erase the price advantage enjoyed by Russian fish. But instead of fixing the problem, the Trump administration has made things worse for Alaskan fishermen.

Alaska pollock’s new top promoter: Upping price may be only way to grow; trashing Russia could backfire

February 5, 2019 — Given that the harvesters of Alaska pollock are limited in how much they can catch and there is no shortage of sales, the only sensible tack to grow business seems to be increasing the fish’s value on the market, believes Craig Morris, the new CEO of Genuine Alaska Pollock Producers (GAPP).

Also, he’s not sure it makes sense to keep attacking Russian pollock as an inferior product.

“Russia is making a major investment in their fleet,” he said. “Potentially the quality differences between US and Russian pollock in five to 10 years are less than they are today. I think that’s one of the things we need to talk through … I would hate for us to invest millions of dollars to differentiate ourselves from Russian pollock and then, at the end of that campaign, [find out] the way that we chose to differentiate ourselves doesn’t make any sense.”

Read the full story at Undercurrent News

Importance of Russian king crab grows as Alaska supplies tighten

January 25, 2019 — Quotas of Russian-landed red king crab from the Far East and Barents Sea fisheries are growing even as Alaskan landings shrink due to concerns about the health of the stock.

However, members of the Global Seafood Market Conference’s Shellfish Panel said last week that US supplies of red king crab are dropping due to the lower Alaska quotas and reduced Russian imports as more crab is sent live to China and South Korea.

The US supply situation could get worse before it gets better, John Sackton of Seafood Datasearch told the audience.

The Alaska Department of Fish and Game set the Bristol Bay King Crab quota at 4.3 million pounds for the 2018/19 season, which compares to 6.6m lbs in 2017/18. This year’s effective spawning biomass was 33.3m lbs, greater than the 14.5m lbs needed to open the fishery. But there is concern that the biomass could shrink further in future years, Sackton said.

Read the full story at Undercurrent News

Chinese processing still dominant, but cracks starting to show

January 17, 2019 — A recurring theme at the 2019 Global Seafood Market Conference, taking place from 15 to 17 January in Coronado, California, U.S.A., has been China’s dominance in the skilled processing sector, and whether rising labor costs would push that processing elsewhere.

A burgeoning middle class in China has steadily driven up the labor costs for skilled processing, particularly in the large groundfish processing sector. The trade for groundfish has historically been dominated by Russian exports to China, and Chinese re-exports to the European Union after processing.

Yet despite the rising labor costs, Chinese importing for processing show no signs of slowing, according to statistics from Rabobank International.

“They’ve had huge wage increases already,” Gorjan Nikolik, a senior industry analyst for Rabobank International, said. “They should not be this competitive, and yet they are.”

Between 2012 and 2017, Russian exports of groundfish to China decreased by more than 50,000 tons. Even with the decrease, the trade between Russia and China was still by-far the largest in the world in terms of volume, and the amount of groundfish exported from China to the E.U. barely slowed.

Those numbers tell the story of Chinese processing still representing a huge portion of the market, given Chinese exports of groundfish to the E.U. are almost exclusively processed.

Read the full story at Seafood Source

US tilapia demand falls

January 15, 2019 — Americans’ consumption of tilapia has fallen in recent years, while demand from Russia has surged, according to a new report.

While the United States is still the largest importer of tilapia, imports slid an estimated 10 KT in 2017, according to a Fact.MR report.

The U.S. trends mimic the global tilapia market, which declined 6 percent in the first two quarters of 2017, thanks to weakening consumer demand, Fact.MR found.

Consumers globally are buying other specialty fish and are more interested in pangasius, analysts said.

“A special palate for pangasius has been witnessed among seafood consumers worldwide,” Fact.MR said in the report. “The U.S. and China continue to remain the largest consumers of pangasius. Following the increasing domestic demand and lower prices of pangasius, Chinese tilapia farmers are adopting farming of other fish varieties including pangasius.”

Meanwhile, the Russian Federation imported 4 KT more tilapia in 2017 versus 2016.

Read the full story at Seafood Source

Farm bill’s untold story: What Congress did for fish sticks

December 21, 2018 — The Farm Bill Congress passed last week will be known for many things. It increases subsidies for farmers and legalizes industrial hemp. But for Alaska, the bigger impact might be what the bill does for fish sticks served in school lunchrooms across America.

The national school lunch program has for decades required school districts to buy American-made food. But that doesn’t always happen when it comes to fish.

“There was a major loophole,” Sen. Dan Sullivan said. “Major. That allowed, for example, Russian-caught pollock, processed in China with phosphates, sent back to the United States for purchase in the U.S. School lunch program.”

Let’s break that down: Rather than buy fish sticks made of Alaska pollock, many school districts buy fish caught in Russian waters that are frozen, sent to China, thawed, cut up, sometimes plumped up with additives, refrozen and sent to the U.S. And it qualifies for a “Product of USA” label because it’s battered and breaded here.

“Literally turns a generation of kids in America off of seafood when they have this as fish sticks in their school lunches,” Sullivan said. Aside from being bad for Alaska’s fishing industry, Sullivan said the twice-frozen Russian pollock is bad seafood and kids won’t like fish day at school.

Read the full story at Alaska Public Media

‘Buy American’ provision survives in US Farm Bill, big win for Alaskan pollock

December 12, 2018 — Alaskan pollock harvesters and processors have scored a major victory over their Russian competitors in the waning moments of the 115th US Congress, promising to end their dominance in US school meals.

A provision championed by senator Dan Sullivan, an Alaskan Republican, to close a major loophole in the US Department of Agriculture’s “buy American” food rules for school systems, has survived and is included in the text of the final 2018 farm bill conference report released Monday night by House and Senate agriculture committee leaders, Undercurrent News has confirmed.

The legislation must still go back to the floors of both chambers for final votes before Congress concludes, which is expected to happen by Dec. 21. But those final steps are considered largely perfunctory and president Donald Trump could wind up signing the bill before the end of this week.

Read the full story at Undercurrent News

Only way is up for pollock prices in 2019

November 20, 2018 — The prices for all forms of pollock look set to continue to increase next year, sources in the US, Russia, China and Europe told Undercurrent News.

Prices for pin-bone out (PBO) blocks, double-frozen fillet blocks, and the headed and gutted (H&G) raw material the latter is based on, all look set for higher levels in 2019, having already firmed in 2018, the sources said.

During the China Fisheries & Seafood Expo, held Nov. 7-9 in a venue close to Qingdao, ex-warehouse prices of around $3,500 per-metric-ton were being discussed for PBO blocks for A season. Prices for B season of 2018 were done around $3,350/t. Also, double frozen fillet block prices of around $3,200/t are also being discussed for next year.

“We see the price of $3,500/t reached and confirmed and we will take it up from there,” Fedor Kirsanov, CEO of Russian Fishery Company (RFC), told Undercurrent at the show, of the situation with PBO. US suppliers and also a large European buyer confirmed this level.

The level in the A season of 2018 was around $3,000/t (see image below and use the Undercurrent prices portal for interactive data), a leap from the very low level of around $2,350/t hit in the B season of 2017, as the price bottomed out. The pace of the increase has shocked buyers, but producers have been quick to point out this is only a return to a historical norm.

“We felt the fall was pretty quick. Now, it’s going more back to normal. It’s also not like pollock has gone off the charts. It’s back to a level where everyone can make money. It’s going back to a level where producers can make investments,” Tom Enlow, CEO of UniSea — a pollock, cod and crab processing plant in Dutch Harbor, Alaska, which is owned by Japan’s Nippon Suisan Kaisha (Nissui) — told Undercurrent.

The speed of the price increase has been driven by new markets taking the fish, he said.

“When the prices were very low, the producers looked at new markets. There has been more focus on deepskin for Asia and also surimi. Demand for surimi has been very strong, due to the shortfall in warmwater surimi,” the Nissui executive said. “The shortage in warmwater is the reason Thailand is so hot at the moment for surimi. Also, Japan is stable, but they take almost half of the surimi the US produces.”

Read the full story at Undercurrent News