Halibut prices are down from where they were the past few years, but the super-high prices of 2011 and 2012 have tempered demand enough that it may take some time for buyers to get back into the market.
Ex-vessel prices last year were running USD 7 (EUR 5.25) or more, and that was translating into retail prices of between USD 19 (EUR 14.25) and USD 22 (EUR 16.50) a pound, which consumers just didn’t want to pay, says a longtime executive who deals with halibut.
“A lot of wholesalers and retailers were saying ‘we’re just getting too much consumer resistance to this,’ and I think that has a lot to do with the sort of correction many people have been expecting to come over the last couple of years,” the executive says.
Ex-vessel prices at the start of the 2013 season were in the USD 5 (EUR 3.75) to USD 5.50 (EUR 4.12) range, but built-up inventories of frozen halibut from 2011 and 2012 are keeping buyers in a wait-and-see mode.
“Once you lose a little bit of a market segment like that, you don’t get it back by a drop of 50 cents a pound or something like that; it’s got to drop substantially,” the executive said. “A lot of it has to do with some people taking a wait-and-see attitude and some people sort of saying, ‘OK, when are we going to get rid of some of this inventory?’
“Until that inventory is gone — and that’s inventory that was bought at a fairly high price relative to what the marketplace is commanding right now — that’s part of the issue.”
In the first week of May, prices for whole frozen dressed halibut, f.o.b. Seattle, were running between USD 5.75 (EUR 4.31) and USD 8.50 (EUR 6.38), while fresh whole fish ranged from just under USD 7 to just over USD 8 (EUR 6) a pound.
The executive said the USD 5 to USD 5.50 range is the “entry point” for most buyers, but much of the frozen inventory cost suppliers more than that. Some will have to accept losses on product, he said.
Typically, when supply is down halibut prices go up, but that won’t be the case this year, even though the harvest of 31 million pounds is less than the 33 million pounds caught in 2012. “Right now we’ve got a lower supply but you’ve had this history of higher prices the last couple of years,” he says. “It’s going to be slow, I don’t think the lower supply is going to drive up the demand. People are still moving fresh stuff, but the frozen stuff, it’s just not moving much.
“If I look at it, most people are saying to us, ‘If this stuff is hitting the retail supermarkets at USD 14 (EUR 10.50) a pound, it’s going to fly off the shelves.’ But right now it’s still sitting up there…It's going to be a slow year.”
