Ecuador seeks lower taxes from China on shrimp
Ecuador is pressing China to lower taxes on shrimp imports. An impressive 20 percent year-over-year growth in official shrimp exports to China is on the cards for Ecuador this year, according to Ecuadorian trade officials. However the real exports figure is even larger, according to Ronnie Almeida, commercial counselor at Ecuador’s consulate in the southern city of Guangzhou.
He told SeafoodSource that figures for China-bound exports are underestimated given that much supply is going through neighboring states: this includes 1,200 tons shipped to Vietnam, 80 percent of which ultimately ends up in China, Almeida estimates. “The shipments are being routed through Vietnam to avoid tax…we are currently negotiating with China to reduce the taxes.”
Almeida is betting that shrimp shipments will soar, with “much healthier” product offering than Southeast Asian and Indian alternatives. But the country also wants to move beyond shrimp and be an all-round seafood provider to China. “It’s a very good year for shrimp but we are also looking to build our shipments of butterfish and ribbonfish here…we want to expand our volumes and our customer base” explains the country’s senior trade officer in the country.
Ecuador wants more value add from its trade with China but that appears unlikely to achieve George Delger, head of sales at Gondi SA, says butterfish is in demand in China as it resembles similar Chinese species that are no longer available locally.
While the firm is currently selling 2,000 metric tons of fish a year in China supplying the sheer demand for product is a challenge: “if we had the volume we could double our shipments to China but we don’t have the fish.
Chinese demand now accounts for 50 percent to 60 percent of Gondi exports and is replacing the firm’s traditional markets in Eastern Europe and the former Soviet Union.
However, the demand varies somewhat: “The demand is different from China…Russia wants our hake, also we send tuna to canning factories in Kalingrad.”
However, lower capture levels in 2013 are tightening supply. “We will have to diversify species to ease the pressure on certain species…Increasingly it means fish which were previously sent for fish meal are now being used for human consumption.” Delger sees long-term demand for non-traditional species like barracuda and silver croaker.
Russian sales are increasingly been switched to China, according to another major Ecuadorian fishing firm. Alexis Tapia Pino, president of Guyaqil-based Pacfish PA says he has 20 customers in China very keen for larger volumes of butterfish and other finfish varieties like chancho and escolar (both classed as pomfret in Pacfish’s China labelling). “They want smaller fish, 200 grams to 300 grams in size. But they have to expand the selection of fish they’re using…there is not enough butterfish to satisfy demand.”
Tapia Pino is trying to convince Chinese clients to accept alternative species. “We can now say ‘try this one’ and sometimes that works.” Tapia Pino, who also sold 20 containers of mackerel to China in just one day in November, believes the availability is there only because Ecuador isn’t itself a major consumer of seafood: “the domestic market wants filets and shrimp and squid or octopus.”
While he stresses that China is a “price sensitive” market, Tapia Pino is expecting China to displace the firm’s top market, Africa. Pacfish also ships significant quantities to Russia and the U.S. “The U.S. is a totally different market…it’s mostly tuna that we ship there.” Chinese demand for shrimp meanwhile is prompting expansion of shrimp capacity at the firm, says Tapia Pino. “We’re buying new equipment to freeze more shrimp for China.”