Tradewind aiding Chinese seafood importers struggling to secure traditional financing
Demand for premium seafood imports is growing rapidly in China, but the country’s importers are finding it difficult to obtain funding from the country’s banks, according to trade finance firm Tradewind.
The Mönchengladbach, Germany-based company’s office in Beijing had previously provided finance to seafood exporters buffeted by the China-U.S. trade war, but is now drawing increasing interest from importers, according to Tradewind spokesperson Catherine Alvino, told SeafoodSource.
“The [Chinese] government is encouraging imports more than ever before,” Alvino told SeafoodSource. “Many import relationships are new and in need of additional cash flow. The importers are usually mid-sized or sometimes small-sized intermediaries between large suppliers overseas and large domestic retailers. These importers have little bargaining power on payment terms with both upstream and downstream partners along the supply chain. Overseas suppliers need at-sight payment, while buyers such as large-scale chain stores or online platforms insist on longer payment terms. Additionally, many imported goods are not ready for sale. They require additional time in processing or packaging, which places more pressure on importers’ cash flow.”
Alvino said Tradewind can offer flexibility that Chinese financial institutions can't.
“We offer fast funding and scaleable facilities that can grow with our clients’ business,” she said.
The firm often purchases the accounts receivable of a client firm in order to give it cash flow.
While higher average incomes and government encouragement is driving more seafood imports into China, the import trade is not displacing the export business in China’s seafood industry, Alvino said.
As a company rule, Tradewind does not name its clients without their permission, but seafood processor Ningde Xia Wei Foodstuffs Co. has allowed SeafoodSource to publish the details of its Tradewind deal. In 2018, Tradewind provided a USD 6 million (EUR 5.3 million) “export factoring facility” to Fujian-based to the Fujian-based firm as it sought to open new markets during a time when it faced a risk of the imposition of additional trade tariffs on its goods.
Tradewind’s Mandarin language website encourages visitors to “use a German financial solution.”
“We help small- and medium-sized firms with finance to grow. Our service is worldwide,” the company’s website says. “We provide custom-made operating capital resolutions solutions [and] promote international trade development.”
Photo courtesy of Tradewind