Financial strain from coronavirus mounts in China’s domestic seafood sector
The financial repercussions of the coronavirus is starting to take a bite out of China’s domestic seafood sector.
Closed for dining, a leading seafood restaurant chain in the country’s south has started to discount and sell off its inventories. The Yu Min Xin Cun (also trading as Village Fisherman) chain of traditional Cantonese-style restaurants in Guangzhou is now selling grouper at CNY 299 (USD 42.80, 3948) per fish, when it normally goes for CNY 700 (USD 100, EUR 92). It’s also offering mantis shrimp at CNY 28 (USD 4.01, EUR 3.70) per 500 grams, a 60 percent discount on normal pricing, according to staff who answered the telephone at the company’s downtown outlet in Zhujiang New City commercial center.
“We don’t normally deliver food, so this is our main way of reducing our stocks,” the floor manager explained.
The country’s seafood restaurants are taking a hammering due to a plummeting amount of foot traffic as people avoid public places due to fears over the coronavirus outbreak, which has killed more than 1,000 people in China and sickened tens of thousands more.
Under pressure to pay staff, the Xibei Catering Group, which operates 400 quick-service outlets across Guangdong Province, announced it took a bank overdraft of CNY 120 million (USD 17.2 million, EUR 15.8 million) to pay wage bills.
In response to the epidemic, Chinese seafood companies have been donating seafood to the hardest-hit areas, a move that also helps them meet regional and national government appeals to patriotism.
Leading crustacean player Guolian Aquatic has donated CNY 1 million (USD 143,100, EUR 132,000) worth of masks and CNY 2 million (USD 286,100, EUR 263,700) worth of its seafood products to health workers in Zhanjiang and Wuhan. The Zoneco (Zhangzidao) Group has donated CNY 3.1 million (USD 443,700, EUR 409,200) worth of seafood to the national Red Cross as well as CNY 500,000 (USD 71,600, EUR 65,900) to medics from its home base of Dalian, who’ve gone to Hubei Province, epicenter of the coronavirus outbreak. And a CNY 2.3 million (USD 329,200, EUR 303,600) batch of seafood, including Arctic shrimp, cod, and Greenland halibut, has been donated by Jia Wo Agricultural Development Co. (also trading as Joyvio) to the people of Hubei.
Many Chinese seafood processors are themselves struggling with worker shortages, since many of those employed in the sector come from central Chinese provinces like Hubei, which remains in a government-mandated lockdown.
Haixin Foods Co., a major processor and distributor of frozen processed seafood, has reported that its operations are back to normal at its main Fuzhou base, but three of its subsidiary companies, including one in the key fishing port of Zhoushan in Zhejiang Province, are struggling to get workers back. Despite the financial hardship facing other parts of the seafood industry in China, Haixin Foods has reported “strong demand” in its online sales of fish balls and ready meals through the outbreak.
Meanwhile, enforcement actions across the fishery and seafood sector have showcased China’s ability to act quickly to combat issues identified as problematic by the national government. No less than five state agencies – the police, the Market Regulation Bureau, the Agriculture Ministry, Customs, and the Forestry Bureau are all involved in the enforcement of a provincial government edict, “Rules on the Forbidding of the Sale of Wild Animals.” The size and force of China’s could have long-term beneficial impacts on cutting down the trade of endangered species.
The crackdown is already having an effect. China’s Ocean and Fisheries Bureau is conducting daily inspections on the 6,014 trawlers that dock in the key fishery port of Zhoushan, with temperature checks of 15,069 workers coordinated by a Weixin (Wechat) group set up for captains of vessels. Also involved in the enforcement campaign is the Disciplinary Inspection Commission of the Communist Party, which typically focuses on political corruptions.
The Ocean and Fisheries Bureau in the key distant-water fishing port of Fuzhou has established an ‘enforcement team’ which has 317 officers checking restaurants, retailers, and even aquaculture farms for wild animals. It has also “required business owners to sign 78 commitments” to conduct quarantine measures and to cease selling or serving wild animals.
A similar enforcement team in Shenzhen – this time reporting to the Market Regulation Bureau – shut down a seafood distributor it found was trading in protected species. The Ming Shun Seafood store in Da Peng district was selling horseshoe crab, a species protected under law in Guangdong Province.
Greater enforcement actions to clamp down on illegal seafood sales and sales of wild animals in seafood markets – areas long ignored or tolerated by authorities in China – could be a harbinger of future moves against smuggling and sales of illegal, unreported, and unregulated (IUU) catches.
Photo courtesy of Ihor Sulyatytskyy/Shutterstock