A new report on the growth of China’s squid industry is predicting continued growth due to government support, investor appetite, and growing consumer demand.
The report, released by Guangzhou-based Heng Zhou Chengsi, also known as YH Research, notes government support through subsidies has led to investors backing several companies involved in tuna processing, including Ocean Family.
The actions of municipal governments in several Chinese cities have led to a similar situation emerging in the squid sector, as they are competing vigorously, according to the report, to attract squid-processing operations. The governments of Zhoushan and Fuzhou in particular have offered subsidies to encourage fishing firms to transport their catch back home for processing, instead of shipping it abroad
“The Chinese squid industry is now in the rapid growth phase; fishing volumes are rising fast, and the economic benefits are clear,” the YH Research report said.
The Chinese squid fleet has gone from catching 30,000 metric tons (MT) in 1998 to nearly 1.1 million MT in 2022, aligning with global trends.
Showcasing the growth in the squid industry at large, a 2021 study published in the journal Science Advances, said there has been a 68 percent increase in global squid fishing effort between 2017 and 2020.
The increase in Chinese squid catches in particular appears to be mainly driven by rising domestic consumption, with the product having become a popular ingredient in the country’s convenience dining and snack industry.
The Zhen You Wei chain is one of a range of fast food restaurants serving skewer sticks of barbecued squid at outlets across the country, while Lian Meng Xing – a consultancy selling franchises to investors – described the squid fast food concept as one of the hottest trends in the Chinese informal dining scene in a recent online pitch to potential investors.
However, the 2021 paper also pointed out that this rapid growth has largely come at the expense of squid stocks worldwide, with countries’ fleets – mainly China’s – fishing in unregulated, yet still legal, areas with little oversight.
The sheer scale of the Chinese squid fleet – which is the top species of the Chinese distant-water fleet’s annual catch – has worried environmentalists, fishery representatives, and policymakers in several countries outside of China.
Environmental nonprofit Oceana has pointed to the harm that the vast scale of China’s squid-fishing operations has caused to ecologically sensitive areas, finding that 510 fishing vessels flagged to China appeared to fish within 200 nautical miles of the protected Galápagos islands off the Ecuadorian coast between 1 January 2021 and 31 August 2023. The number of Chinese-flagged vessels tripled the vessels flagged to other nations in the same area.
“China’s colossal distant-water fleet is monopolizing the world’s oceans. This fleet is emptying the waters surrounding the Galápagos of marine life, disappearing from the public eye, and fueling unregulated fishing practices beyond the horizon,” Oceana Campaign Director Max Valentine said.
Inside China, though, the same urgency hasn’t entered the dialogue, with squid being presented as a “sustainable” seafood catch in the YH Research report.
Xu Le Jun, director of the strategic research center at the China Fisheries Academy, speaking at the recent China Seafood Summit in Xiamen, said that there’s plenty of space for further increases in consumption of Chinese seafood. Increased focus on the nutritional benefits of squid and other species is just beginning, Xu said.
Major global markets also seem to believe there is plenty of space for Chinese seafood, as the U.S., for example, has bought more than USD 686 million (EUR 634 million) worth of squid from China and Hong Kong over the past five years.
