While U.S. distributors are holding a fair amount of tilapia in inventory, raw materials are becoming scarce, which is expected to boost the price on this popular whitefish.
“The market is a bit saturated,” said one southern distributor of both fresh and frozen tilapia. “There’s a decent amount in the (United) States.”
“We had an abundance of fish this year,” said an East Coast importer, noting storage within the United States has risen.
Yet supplies of tilapia from China are expected to become more limited in part because some farmers stepped away from the species when it became more expensive to produce. Additionally, remaining farmers have held onto supplies in ponds and freezers in the hopes that prices will rise, further limiting what’s coming onto the market.
As the industry heads into the fall and winter, tilapia will grow more slowly in the cold water, so production will go down yet again.
The result, according to the distributor, is likely to be a USD 5-cent to 10-cent (EUR 0.46 to 0.92) increase. Current per-pound prices for frozen moisture-added tilapia have been in the USD 1.90 to 2.50 range (EUR 1.75 to 2.30), with prices about 5 cents higher for no-moisture added product. Last year at this time, prices for frozen tilapia ranged from USD 2.35 to 2.95 (EUR 2.16 to 2.71).
There’s usually a price bounce when a commodity market goes to the bottom, explained the East Coast importer, and that’s what the tilapia market is seeing now.
“I don’t think price will go to new heights,” he said, unless there is a significant event, such as a typhoon. The typhoon season, which runs through November, carries with it a certain level of anxiety, he said. Also, further fallout from an antibiotic scare earlier in the year, as well as the delay in fingerling planting, could potentially impact prices.
Even with the expectation of a price increase, the southern distributor said it is unlikely that buying activity will pick up significantly. “With the exception of container loads, people aren’t buying forward,” looking toward the busier 2016 Lenten season.
However, the East Coast importer said this is the time of year when retail buyers begin to make their decisions. And while he doesn’t anticipate major switches to tilapia from other species, the market has the potential to grow around 2 to 4 percent.
In the short term, the distributor said buyers in his area have been able to stock up because a company “got out of tilapia and they saturated the market with low-priced product and people took advantage of that.”
Ongoing concerns about the quality of imported tilapia, including overglazing, aren’t surprising to one distributor. “It’s a no-brainer that there will be quality issues,” he said. Chinese producers don’t want to lose any more money by continuing to feed fish, which are growing larger in the ponds as they wait for prices to rise, so instead they are pulling them out and freezing them. Then they sit in the freezers for months, he said, where the quality can be compromised.
On the fresh side, prices are also down over last year, ranging from USD 3.75 to 4.05 (EUR 3.44 to 3.71) covering all sizes vs. USD 4 to 4.35 (3.67 to 3.99) in 2014.
But a participant in that sector said prices are likely to rise in October. The hot weather in the United States has slowed interest in tilapia, she said, and has kept the market soft.
Supply — especially product coming in from Colombia — is just more than demand right now, she pointed out.
