The long-established model of Russian pollock being processed in Dalian, China, for Western markets has been broken by the COVID-19 pandemic, leading to higher prices for buyers, according to a China-based seafood trader.
Russian trawlers have long taken advantage of the relatively short distance they have to travel from their fishing grounds to Dalian to offload their catches, but this supply chain has been destroyed by COVID-19-related restrictions imposed over the past year by Chinese authorities, according to Oliver D. Nikolovski, managing director of Nantong-based seafood sourcing firm Ocean Treasure.
Last year, China tightened import restrictions on Russian seafood, affecting whitefish suppliers sending raw materials to the processing hubs of Dalian and Qingdao, Nikolovski said. Subsequently, Russian cargo ships and fishery vessels had to divert to Busan and Vladivostok.
“However, the Alaska pollock from Busan without the new health certificate and the new catch certificate could not pass Chinese customs. This action caused further chaos in the market,” he said. “The supply of Alaska pollock is in disorder, and raw materials are in a huge shortage at the processing plants.”
While Russia has sought to increase the percentage of its catch it processes domestically, some 70 percent of pollock was still sent to Chinese factories prior to the COVID-19 crisis. As a result, Russian fishing firms have to pack and containerize their pollock catch for dispatch through Busan and Vladivostok.
“This will increase the cost of the raw material. Furthermore, they need to do the prevention sterilization work,” Nikolovski said. “All these measures will make the period for the processing factories to receive the raw material much longer.”
Last year, when China banned direct seafood shipment from Russia to China, 10 Russian vessels stayed at the border for over one month, Nikolovski said.
“Over 32,000 tons of Alaska pollock raw materials were ready to unload,” he said.
Nikolovski is advising clients still shipping to China to allow a month for port clearance, an option some firms have decided is untenable. Faced with the logistical challenge of that delay, some Russian pollock fishing firms have reduced their catch in 2021.
But the temptation of rising pollock prices may lead them to find other avenues to market. Supply bottlenecks and “massive” demand in Europe and the U.S. have forced pollock prices upwards, said Nikolovski, even though some new supply is getting through from Russia.
“These 2021 raw materials sell fast, and the factories are full of orders. The price of Alaska pollock is 26.4 percent higher than in August 2020,” Nikolovski said.
Photo courtesy of vivienniu/Shutterstock
