They’re working overtime at the Jingshen seafood wholesale market in Beijing this week. A few weeks before Chinese New Year, the traders in this — the biggest such market in northern China — are busy filling orders from restaurants and retailers gearing up for one of their busiest periods of the year.
But while it’s clear business is brisk, there’s little else clear-cut about China’s wholesale seafood trade, especially when it comes to imports. Those who have lived some time in Beijing will be used to the lack of transparency or traceability in the grocery trade. Fish mongers in local supermarkets or wet markets I regularly visit rarely bother with labelling that describes the providence or production process in seafood on sale and often appear puzzled why you’d want to know who the producer might be.
Yes, retailers and restaurants have become increasingly keen to stress the providence of their goods when it’s imported: French oysters or Canadian crabs fetch a premium price. But it’s less about traceability than profit, with little effort to assure or educate customers about what they’re buying.
Part of the reason for this goes back to the Jingshen, and the nature of the trade. Many of the firms importing seafood come from non-seafood backgrounds. Some of the country’s larger seafood importers are in the mining (like the curiously-named Sunkfa International Trading Co, one of Beijing’s biggest importers) or manufacturing sectors and have studied the markups in seafood and piled in.
These are not seafood importers then in the traditional sense. But they’ve been lucky to corner one of the limited licenses from government that allows them to import seafood for domestic consumption. They’re very reluctant to talk about what they import, I’ve discovered, having made numerous attempts to interview executives of firms (including Sunkfa) I’ve been pointed to while hanging around the sprawling Jingshen market.
I can understand some of the reticence. Firms with the license to import seafood have been eager to ask me for new contacts and new sources of imports. But none have been willing to speak on the record about their trade.
Numerous restaurateurs and retailers I’ve talked to over the past year have told me some of the reasons why importers don’t want to talk to media. One, because they’re genuinely worried their peers will then pinch their suppliers if they do speak in detail to media, but I’m also told that seafood importers are even more afraid of the taxman. They decline to offer any details of the trade because they’re sometimes under-declaring or mis-declaring their imports. Import taxes on seafood like crabs, abalone and grouper are classed as luxuries and taxes of up to 25 percent can apply. But a good share (one buyer for Beijing seafood restaurateurs told me it’s as high as 30 percent) of imports are falsely categorized as seafood for processing.
And then there’s smuggling (accounting for more than 30 percent of actual imports, according to those I talked to). Many in the business of preparing and selling seafood to the public in China have told of local seafood importers willfully smuggling seafood across the border from Hong Kong. A similar ploy has been used in Guangxi province, bordering Vietnam (and thus near the wealthy southern regions like Guangdong), though customs authorities have apparently tightened up there in recent months.
With smuggling so prevalent there appears to be little prospect of China improving the traceability of its seafood sales. Yet pledges from central government to improve food safety would appear to suggest improved traceability will ultimately apply to seafood. Likewise, as China’s economy slows (to a more normal level of growth, tighter times will mean a more energetic effort to collect taxes.
There’s another factor that should improve traceability and squeeze the smugglers: Every major port seems to have a plan to become a seafood trading hub or logistics center. In the last year alone Qingdao, Shanghai and Tianjin have all announced big plans for seafood trading hubs and are building cold chain logistics and storage facilities for seafood.
Officials in these port cities have looked at high-end seafood imports and seen the trend and want some of the tax revenues and port levies that will come with that. This investment will need to be repaid. So smugglers are going to be forced to go through the proper channels and importers will have to make proper declarations.
That will hopefully be the case. In the meantime there’s a lot of business to be done at Jingshen this month.
