Production availability in China is low right now, partially as a result of regular congestion ahead of the annual Chinese New Year shutdown in January-February, and partially as a result of the new US tariffs coming in to place on some Chinese goods in October and again in January. US importers are looking to get as much product out of China as possible ahead of the tariffs, leaving many plants booked solid through the end of the year.
With the 2018 quota down, prices on Atlantic cod raw material continue to rise – H&G prices have increased 5-10% since April. The quota is recommended to be cut again for 2019, by 13%, a higher reduction than expected. The final quota has not yet been set, and the exact number could still change, but a reduction is still expected for 2019, and prices will likely increase as a result.
Haddock pricing is on the rise. The 2019 quota is expected to be cut by 25%, which will also be confirmed later this year, along with the Atlantic cod TAC. While pricing on haddock is expected to increase coming into 2019, it will likely increase less than Atlantic cod; the decrease in quota may instead insulate prices from a drop, and keep them steady, or slightly higher.
Pacific cod H&G prices have increased this year on the heels of cuts to the quota; prices are continuing an upward trend, and demand does not seem to be softening, as Atlantic cod and haddock prices rise as well.
Large sizes of sole fillets (6oz and up) are in short supply both in overseas H&G, and in on hand inventories in North America, with pricing increasing.
Pacific snapper (rockfish) fillets 4oz and up are in short supply right now, with pricing increasing. Demand has increased as a result of rising pricing in other species of white fish, such as cod, as well as expansion into new markets when supply was plentiful last year. In addition, the fish currently being caught are yielding primarily a 2-4oz fillet, with a small percentage of 4-6oz fillets, and even fewer 6-8oz fillets.
The pricing outlook for Atlantic salmon for Q4 2018 and Q1 2019 is trending up. Both Norway and Chile are having issues with sea lice – in the short term, this means more supply of smaller fish as farms harvest early to avoid losses (the average harvest weights for September were 250g lower than last year), but in the long term means lower total harvest numbers, which will push prices up.
Reports indicate that we are likely at the bottom of the market, and prices should rise in October & November – exactly when and by how much, depends on how many small fish are harvested, how extensive the sea lice issue is, and how quickly production is booked. Demand from Russia and China are also strong, which will push pricing upwards as well.
While the overall harvest of Pink salmon from the 2018 season was high, supply in the market is expected to be slightly lower than last year, owing to challenges Russian producers had in freezing and storing salmon. As a result, pink salmon prices are up around 5-10% over last year. Supply on keta salmon from Russia is very, very limited right now, with fishing for the season completed.
Overall, global shrimp supply is increasing, with global shrimp production forecasted to increase 5.7% annually on average from 2017 to 2020 – much of this growth is expected to come from Vietnam, Indonesia and Ecuador, with India remaining stable, and China decreasing for 2018; with high competition and demand on commodity shrimp, many packers are diversifying their value-added shrimp portfolio in order to increase vendor loyalty, and minimize potential losses from significant swings in the commodity market.
The shrimp market remains relatively steady. In India, raw material is in low supply, so prices remain high, but stable, as there are not many new bookings. Supply is expected to improve in around two weeks, so many importers may be holding off on booking until then.
In Vietnam, export prices in September were up on over June-August prices, but is relatively stable heading into October. Supply is sufficient for order needs, and Chinese traders are not purchasing too aggressively, which is keeping things level. Prices are expected to increase up to 5% in October and November, when market demand increases for the holidays, and Chinese traders will likely come in to purchase more ahead of Chinese New Year.
Landings are reported as fairly good for current fishing in New Brunswick, but are diminishing as the season continues.
Maine lobster landings for September were mediocre, and poor weather has hindered supply and driven up shore prices. Live lobster pricing will rely mostly on Maine landings, and buying interest from both the live trade and processing sectors have pushed live prices well above 2017 levels.
Demand from the US on tails remains high and inventories low, pushing pricing upwards, especially on mid-sizes of tails (3-4oz to 5-6oz); some supply shortages on tails are being seen.
Demand on lobster meat is inconsistent despite some lower prices stimulating purchasing; peak demand is over with the main tourist season on the East Coast ending, but product is moving more quickly than in 2017, so pricing may firm up.
Large formats of pasteurized blue crab meat (colossal, jumbo and super lump) have seen large drops in pricing as a result of high inventory levels in North America. Replacement costs overseas, however, have firmed up, and in some cases exceed the low prices that are being dumped in the market for quantity buys – most importers project we are at the bottom of this trend, and pricing will rise once inventories are depleted and replenishment is in the market.
The new season of red crab from China is projected to be only 40% of last year’s harvest, which is pushing an already high-priced and short species up even further, and pricing will be further affected by the new tariffs to the US on Chinese imports.
Low supply and high prices on red crab will push more demand onto blue crab, and increase pricing on all formats of blue crab, likely very quickly.
Since the spring, king crab markets have been firm from Russia, with supplies very, very tight as a result of high demand for live crab, and prices on frozen are up 15-25%. More and more live crab is staying in Asian markets, and demand is high in Japan for red king crab, leaving less available for freezing for the North American market. New shipments may not arrive in North America until late October or November, with pricing still on the rise, and outlook on further supply not encouraging.
Larger sizes of snow crab (8oz+) are very firm, with active demand; pricing on 5-8oz is steady, continuing well above the three-year average.