China’s tilapia supplies may be squeezed next spring due to severe damage to farms in a key production region. Two typhoons ravaged southern China in July and September and brought “tremendous damage” to the tilapia industry in Hainan province.
“Hatcheries suffered big losses,” said Han Han, the Hainan-based country manager for the Sustainable Fisheries Partnership (SFP), which advises tilapia producers in Hainan on improving quality. “This significantly cut the supply of quality fry and fingerlings…and could also impact the stocking next spring.”
From talking to large hatcheries in Hainan, Han estimates there may be a 50 percent decrease in seed production compared to the same period this time last year. She explains: “While large hatcheries are struggling to power up the production after typhoons and bad weather, many small hatcheries with unstable quality and poor management might take advantage of such high demand and short supply on the market right now. Thus people are worried about the quality of the grow-out fish months later if farmers restock with less-qualified seeds.”
Farm-gate prices in Hainan have so far been “reasonable” in 2014, says Han, in part due to low numbers of fish available in ponds due to high temperatures and typhoons. Prices for tilapia sized 500 grams and larger averaged CNY 5/500g (USD 0.81; EUR 0.65) in Hainan province last week, according to a ministry of agriculture price monitoring system. This compares favorably to the RMB 4.90 paid in Guangdong province and CNY 4.20/500g (USD 0.68; EUR 0.54) paid in Guangxi province, one of the fastest growing producers of tilapia in China. Wholesale vendors were meanwhile quoting CNY 8/500g (USD 1.30; EUR 1.03) at the Xinfadi wholesale market in Beijing.
The current prices are a big improvement over October 2012 when farm-gate prices in Hainan and Guangdong both slipped to CNY 4 (USD 0.65; EUR 0.52), having fallen from CNY 4.5 (USD 0.73; EUR 0.58) average paid to tilapia farmers in 2011. Han believes prices will hold steady in 2014 “…but it is expected that large amount of fish will be harvested after October. The price might drop a bit.”
Officials in Hainan have been seeking to encourage more eco-friendly production to attract higher prices for the region’s tilapia at home and abroad. SFP-assisted tilapia producers recently got approval from the Hainan government — government in China is usually very wary of licensing non-government organizations — to formally establish the Hainan Tilapia Sustainability Alliance. The Alliance has been running trials of best practices in selected farms, some of which are supported through a grant from Dutch-based Sustainable Trade Initiative/IDH under the IDH’s Farmers in Transition Fund, which aims to increase responsible production of shrimp and tilapia.
The link-up with IDH (a program co-founded by food processing giant Unilever), said Han, helps give the buyers more confidence. Indeed, U.S.-based The Fishin’ Co. is one key buyer already working with SFP and the Alliance to share market information and advise Hainan farmers on best practices. Fishin’ Co. supplies to Walmart and German retailing giant Aldi, which in May sent a group of managers to visit Hainan. They discussed market needs with farmers, explained Han. “That help raised the suppliers and producers’ awareness on sustainable aquaculture and seafood.”
There are signs of increased domestic consumption of tilapia, as processors here adapt the species to local dietary and culinary trends. For instance, online retailer Yihaodian (owned by WalMart) is this week promoting 150-gram filets of tilapia for a modest CNY 9 (USD 1.47; EUR 1.16). This is part of a promotion of fish suitable for sushi, which is extremely popular with China’s young and wealthy classes.
Local processor Pin Xian Mao offers 300-gram tilapia filets at CNY 28 (USD 4.57; EUR 3.61) on Taobao.com, promoting the fish in the same category as eel and perch. In another interesting development, Zhanjiang Huanlejia Food Co, a major cannery based in Guangdong province, has started selling 465-gram tins of pre-cooked tilapia for CNY 15.90 (USD 2.59; EUR 2.05).
Average prices for fresh tilapia filets at U.S. Customs were down 4 percent on that of the previous month and 2 percent on that of August 2013. The price of frozen products was USD 5.30 (EUR 4.18) per kilogram, down 4 percent on that of May but up 7 percent on those of August 2013. Approximately 2.3 million metric tons of tilapia are produced annually (73 percent of it farmed) with most of the production in China, followed by Egypt, Indonesia, Thailand and the Philippines.
