China seafood exports rise on weaker currency

Published on
February 27, 2014

China’s seafood exports appear to be picking up on the basis of a weaker CNY and recovering demand in western markets. Data provided to SeafoodSource by authorities in the leading tilapia producing region of Hainan shows shipments of seafood rose 11.8 percent year-on-year in January, with tilapia shipments (accounting for 11,000 metric tons (MT) of that figure) up 21.9 percent in volume terms. This comes as China’s government has made deliberate efforts in recent months to weaken the value of the country’s currency in order to reboot exports as a driver of economic growth. A breakdown of movement in the value of Hainan’s exports is not yet available.

Some of the growth in Hainan’s shipments may however also be down to the emergence of new markets for tilapia. The Middle East grew 49.2 percent year-on-year to 1,746 MT, eclipsing the EU (1,540 MT, up 18.3 percent year-on-year) while the U.S. remains the top destination for Hainan’s seafood exports, taking 4,611 MT, a rise of 9.2 percent year-on-year in volume terms. Likewise the southerly province’s customs authorities in a statement credited efforts to “simplify and prioritize export procedures for aquatic goods” the growth in seafood exports.

China’s efforts to devalue its currency (which has fallen 1 percent against the dollar this year to date, having risen 3 percent against the dollar last year) comes as deliberate efforts by Tokyo in 2013 to weaken the Yen has created problems for Chinese exporters to Japan. Data for the country’s eel exporters shows exports are up but pricing remains a problem. Eel shipments rose 37 percent year-on-year in 2013 to total 5,295 tons. Yet revenue from exports rose only 6 percent, to USD 181.3 million (EUR 132.8 million). Average prices per kilogram (kg) were down 22 percent year-on-year to CNY 32.24 (USD 5.26, EUR 3.85) per kg. Japan is the leading export market for Chinese eel.

A weaker CNY may be good news for seafood processors, who blame rising costs and a stronger Chinese currency for weak trading conditions. Releasing its official results, leading processor Oriental Ocean this week announced its profits for 2013 slipped 38.59 percent year-on-year to CNY 60.8 million (USD 9.9 million, EUR 7.3 million), on revenues of CNY 616 million (USD 100.5 million, EUR 73.6 million) (down 9 percent year-on-year). The firm blamed the poor performance on rising labor and input costs and softer demand in the “high end” domestic catering sector. A boost in exports could be good news for Oriental Ocean, which had looked to high end domestic sales: in explaining its 2013 results the firm also blamed weaker than expected performance from its salmon cultivation business “due to some disease and weather factors.”

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