Seafood prices in China rise sharply in peak period but freshwater glut continues

Published on
March 18, 2016

Crabs, shrimp and sea-caught fish species continue to top the lists of the most sought-after seafood in China. That’s according to a survey of 80 wholesale markets nationwide compiled by China’s agriculture ministry that shows prices for certain species were well up in the busiest period of the year for Chinese seafood sellers. Prices for freshwater species, however, struggled in January in the run-up to Chinese New Year.

According to the survey, the average price of seafood averaged CNY 21.93 (USD3.28) / kg, a rise of 6.33 percent year on year and 4.35 percent month on month. Prices for seawater product averaged CNY 40.24 (USD 6.03) / kg, up 10.14 percent on a yearly and up 7.51 percent on a monthly basis.

It’s clear from the pre-Chinese New Year buying splurge which species remain most in demand. Demand appears to be particularly positive for crab: average prices for the category ‘crab’ rose 51.60 percent year on year, while prices for mussels and Chinese mitten crabs rose 31.36 percent and 25.23 percent respectively compared to the same period last year.

In January prices for crabs, mussels, vannamei shrimp and silver pomfret rose 25.48 percent, 24.88 percent, 18.76 percent and 17.33 percent, respectively, compared to the previous month. Vannemei prices have however eased from an all-time high of CNY 95.25 (USD14.28) / kg in February 2014 at the height of the EMS disease crisis.

Overall, prices for seawater (wild caught or farmed) fish, crustaceans and shellfish prices rose 9.84 percent, 11.13 percent and 2.59 percent, respectively, compared with the previous month. But average prices for freshwater crustaceans and freshwater “other” prices rose by only 3.20 percent and 0.47 percent.

On a year-on-year basis, marine fish, marine crustaceans and marine shellfish prices were up 9.93 percent, 16.26 percent and 9.40 percent, respectively. Freshwater crustacean prices rose 18.91 percent while prices for freshwater “other” rose 9.87 percent. Of the 28 varieties of seafood surveyed, there were price rises for 57.14 percent of the total seafood surveyed.

There was much slower growth in pricing for freshwater product, which seems to be in over-supply. At CNY 14.83 (USD 2.22) / kg, the average price of freshwater seafood rose only 1.51 percent on a yearly basis and 0.34 percent on a monthly basis. Freshwater fish prices fell 0.18 percent, further evidence of a gradual drop in demand for commonly cultured species like carp and tilapia, both of which are in oversupply in much of China.

China’s seafood sales tend to be highly cyclical, with prices surging in the run-up to Chinese New Year celebrations, which were this year held in early February. Volume of product sold at the 80 markets was at 984,700 tons, up 3.95 percent from January, while turnover at the 80 markets surveyed amounted to CNY 18.43 billion (USD 2.76 billion), a rise of 4.66 percent year-on-year.

On balance, it appears that there’s growth in demand and pricing for most species but the outlook is least certain for freshwater fish species. A decline in pricing for carp in particular has set in since 2013 and suggests that Chinese consumers are seeking to upgrade their purchasing preferences to more premium species.

The pricing data comes at a time when overall inflation has weakened in China from the soaring rates seen early in the last decade. Economists cheered that China’s consumer price index rose 2.3 percent in February of this year, a rate faster than expected. The number, presumably, was helped by Chinese New Year celebrations and an increasingly vibrant domestic tourism market. Yet overall prices have weakened in China due a weaker housing market and a slowing economy in general, as infrastructure and lending have both slowed while bad debts have increased across the economy.

In January and February, as a whole, the consumer price index still rose by an average of 2 percent, compared to 1.5 percent in the same period last year. Tom Rafferty, Asia Economist at the EIU, believes upward pressure on prices from the warming property market will further drive the index upwards in the coming months. However, government will be less likely to continue loosening interest rates to stimulate the economy with bank lending, according to Rafferty.

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