Market Report- Whitefish

Surimi import prices level off in Japan

By Chris Loew, SeafoodSource contributing editor, reporting from Osaka, Japan

02 November, 2009 -  Prices of U.S. Alaska pollock surimi exported to Japan declined by just JPY 10 to 20 (USD 0.11 to 0.22, EUR 0.07 to 0.15) per kilogram from July to August, compared with much sharper declines from the fall of 2008 to the spring of 2009.

The U.S. pollock harvest is divided into the "A" season, which runs from January through March, and the "B" season from early July to early October.

Prices in the 2008 B season shot up due to a reduced quota in the Bering Sea. There was also strong demand in the European Union because of an appreciated euro and Europeans' preference for certified-sustainable product. In the fall of 2008, prices at Japanese Customs for U.S. pollock surimi was JPY 630 to 640 for FA grade, JPY 580 for A grade and JPY 520 for KA grade, according to the Suisan Times. Grades are determined by gel strength, moisture content and whiteness.

The price fell for the 2009 A season, as the economic crisis curbed Japanese demand for fish-paste products. Wholesale prices of surimi products in Japan fell by 20 percent, and food processors had plenty of surimi in freezers. By August, prices had declined to JPY 450 to 480 for FA grade, JPY 350 to 400 for A grade and JPY 250 to 280 for KA grade, according to the Nikkei Shimbun.

As for the remainder of this year, expect demand for higher-grade surimi to increase as Japanese producers line up supplies for the New Year's holiday, when a lot of fishcakes are consumed. But buyers may find supplies tightening.

Alaska pollock used to be made mostly into surimi, but with surimi prices down, the ratio has shifted to approximately 70 percent fillets and 30 percent surimi. U.S. domestic demand for whitefish fillets is also rising, partly due to the species' inclusion in school lunch programs in New York and California.

For itoyorí (golden threadfin bream) surimi — sourced mainly from India, Thailand, Indonesia and Myanmar — the average price at Japanese Customs was JPY 224 per kilogram in August 2009, down 54 percent from August 2008 but up 2 percent from July. Itoyorí surimi generally grades lower than that made from Alaska pollock. Supplies to Japan are not expected to grow, as more processing will be done locally.

While Alaska pollock is Japan's most important source of surimi, Argentine hake, Pacific whiting and New Zealand hoki are also used.

Between 1 January and 8 October, 194,885 metric tons of hake were landed in Argentine ports, but the fishery will be closed as a conservation measure in the southern part between 1 October and 30 December.

New Zealand's 2009-10 hoki catch was increased by 20,000 metric tons, to 110,000 metric tons, but this is still well down from a high of 250,000 metric tons in 2001. Like U.S. Alaska pollock, New Zealand hoki is certified as a sustainable fishery by the Marine Stewardship Council.

The Pacific whiting (Merluccius productus) fishery off from Washington, Oregon, California and British Columbia also gained Marine Stewardship Council certification on 21 October. This year's quota is set at 135,939 metric tons in the United States and 48,061 metric tons in Canada, a 42 percent cut from the previous year.

Global whitefish supplies are tightening, which should prevent prices from continuing to slide. Yet in Japan's ailing economy, food wholesalers are still demanding price reductions, resulting in a difficult operating environment for fish-paste product manufacturers.

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