Export prices for tilapia will be lifted by 10 percent this year by a leading Chinese tilapia exporter.
Hainan Qinfu Foods Co., based in the tilapia producing region of Hainan, will increase prices by 10 percent in 2013 to meet rising costs for feeding tilapia and for sourcing tilapia from farmers, according to company export sales manager Elena He, speaking to Seafoodsource.
The Qinfu executive says soft demand in Western markets is being bolstered by rising demand in Africa and the Middle East. Yet Qinfu, which ships 700 tons per month, has found that new markets emerging in Africa are “very low-margin,” according to He. She says Qinfu has made efforts to ramp up sales of whole-round tilapia in the Congo, “but buyers in Kinshasa remain even more price sensitive than our U.S. customers.”
More hopefully, Qinfu has found some success catering for the Halal-compliant Middle Eastern market by supplying fish with part skin on. “The African market is largely whole-round fish but we prepare fish with skin partly left on.”
Lousy weather in Guangdong province earlier this year impacted tilapia supply, thus pushing farmgate prices to as high as RMB6 this month.
In the first half of 2013, farmgate prices for tilapia averaged RMB4.6-4.8/ kg in Hainan, while in the Pearl River delta area of Guangdong producers reported average prices of RMB5/kg, according to the China Aquatic Products Processing & Marketing Association (CAPPMA). As of 20 August, the factory prices in the Maoming area of Guangdong province (China’s largest cultivating region for tilapia) had risen to RMB5.2/kg to RMB5.4 / kg.
Tilapia farmers have complained that feed costs and pond rent fees have been rising fast, according to Elena He. Prices for rapeseed and other raw materials used in tilapia feed rose sharply, and feed meal and fish feed prices also rose across the board.
There are regional variations in tilapia prices in China, depending on fish weight. CAPPMA data shows farmgate prices for tilapia weighing 1-1.6 kg averaged RMB4.9/kg in Hainan Province but RMB5.3 in Guangxi province near Vietnam, and RMB5.1/ kg in Guangdong. Fish sized 0.6-1 kg sold for RMB3.9/ kg in Hainan and RMB4.3 yuan in Guangxi and RMB4.1 yuan in Guangdong.
China’s overall supply of tilapia improved in 2012, driving a 9.6 percent growth in 2012 export volume compared with 2011, according to the U.N.’s Food and Agricultural Organization (FAO). Shipments of frozen fillets — which make up nearly 50 percent of the total Chinese tilapia exports — rely on the U.S. to absorb 60 percent of volume. Yet exports also increased to Russia and Ukraine and into relatively new markets such as Iran (+241 percent) and Kazakhstan (+124 percent) in 2012.
Rising labor costs remain a burden for tilapia exporters like Qinfu; Elena He claims that her firm’s factories are forced to increase wages by 10 percent a year to hold onto staff. This tallies with data from China’s Ministry of Human Resources and Social Security, which has projected an average 18.4 percent increase in minimum wages in 22 Chinese provinces in 2013.
China has competitors in the region for overseas sales: Indonesia has vowed to increase its tilapia cultivation from 567 078 metric tons in 2011 to 1.1 million metric tons this year.
