A lack of supply that pushed pangasius prices higher in the U.S. market by 10 percent or more in 2011 is expected to extend into 2012, with some importers saying they expect the first quarter to first half of the year to remain tight.
“Demand is still good [in both foodservice and retail], it’s the supply that's down,” says one large U.S.-based distributor of pangasius. “Supply is down. There doesn’t seem to be a lot of small fillets around, and I think that's going to continue into the first quarter. I think prices are going to be strong. The movement is still good on what we have.”
While the Vietnamese Association of Seafood Exporters and Producers officially forecasts 2011 exports of pangasius fillets to total USD 1.6 billion, much of that value boost seems to originate from the higher prices buyers are paying for product.
Where fillet prices last year were around USD 3 a kilogram, prices now are at or above USD 4, according to distributors. While pangasius prices remain below prices for other whitefish, it no longer is the bargain it once was.
“There will be these prices and shortages through April, May, and then the supply may get stronger as we head into the summer months, with prices trending down modestly,” said one East Coast seafood distributor executive.
Despite the tight supply and higher prices, the distributor sees the market for pangasius remaining strong. “This is a growth market, as very few commodities are trading in these ranges, even at these high costs,” the executive said. “The fish is very versatile, it is mild. Many retailers are adding pre-breaded and marinades into the swai, so value-added still has room to grow.”
The shortage in pangasius stems from record flooding in Vietnam that decimated much of the fry supply. This has prompted farmers to keep the fry that survived in their pens until they can grow to larger sizes they can sell for more money and allow them to better recoup their costs. It costs about the same to grow a pangasius to yield a 3-ounce to 5-ounce fillet as it does to grow them to between 5 and 7 ounces, or 7 and 9 ounces, but the farmers get paid more for the larger fish.
“Harvesting a smaller fish yielding a 3- to -5-ounce fillet size basically costs the same and is not as desirable to the farmers,” said the distributor, who buys IQF fillets packed in 15-pound boxes, and shatterpack fillets packed in 4-by-10-pound boxes.
What could add to supply woes in 2012 and beyond are reports from Vietnam that some pangasius farmers are switching to farm tilapia, which they plan to sell in the United States. While this may be a response to better technology available to grow tilapia, some Vietnamese farmers may not want to deal with potential problems that could develop if the United States changes the rules for pangasius and requires it to meet the same standards as domestic farmed catfish.
But the pangasius distributor says this hasn’t been much of an issue with the people buying the fish: “That’s not the issue, there’s still one or two people on the sidelines but mostly everybody is in the game.”
