Anti-dumping tariffs, antibiotic levels hurting Chinese seafood exports
Anti-dumping tariffs in key markets are hampering exports, according to authorities in a major shrimp producing and exporting region in China.
The southern city of Zhanjiang, home to shrimp processing and exporting giant Guolian Aquatic, exported 74,400 metric tons (MT) of product in the first three quarters of 2016, worth USD 457 million (EUR 348 million) – up 4.4 percent year-on-year in volume and up 3.5 percent in value terms.
However, “the situation is not optimistic,” according to a statement from the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), listing several challenges facing exporters. The AQSIQ statement points to a continuing incidence of trade disputes involving “excessive residues of antibiotics” in seafood from Zhanjiang - which, it said, is squeezing exports to the European Union, the United States, Japan and South Korea. It also pointed to weaker economic recoveries in key markets: “buying power is withering” in key buying regions such as Europe, it reported. Exporters in Zhanjiang, meanwhile, have been put under pressure this year due to what it terms a series of disease-related “failures” of the Vannemei shrimp crop in the Guangdong region. This “loss of raw materials resulted in shrimp shortages,” according to AQSIQ.
Problems with antibiotics traces and disease have dogged Zhanjiang producers for years. A more serious challenge, however, may be growing competition from neighboring countries.
“[Their] aquaculture technology has become increasingly sophisticated, they have low production costs, resulting in intense international market competition,” notes the AQSIQ. The situation for Zhanjiang aquatic exports is “grim,” it stated. The AQSIQ doesn’t name any country in particular, but Vietnam is China’s main competitor in shrimp production.
The AQSIQ statement is gloomy compared to optimistic predictions earlier this month for earnings at Guolian in 2016 – underlining perhaps the success of major efforts by Guolian to create new products for the domestic market and food service in particular.
According to AQSIQ recommendations, Zhanjiang’s seafood sector should shift away from dependence on Western markets and target sales to countries covered under China’s “One Belt One Road” program to build trade through infrastructure projects in the region. The Chinese industry should also “actively study foreign technology” to develop products, AQSIQ said.
AQSIQ’s other solutions are familiar: China needs to improve quality control while companies should cultivate their own brands and improve product value. Interestingly, industry associations should be encouraged to “play a bridge link role” to improve the seafood sector, suggested AQSIQ – a role made possible due to most of China’s seafood industry bodies being state-run and sponsored.