EP 168 | AIRED 01/27/2014

Pacific Cod TAC, Demand, Prices, Inventories, Whiting Supply Strained and Opportunities

January 27, 2014 - Welcome to The Tradex Foods "3-Minute Market Insight" This is Robert Reierson and here is the seafood news for Monday January 27th, 2014.

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---The National Marine Fisheries Service announced an increase of 2.5 percent in the Total Allowable Catch of Pacific Cod in the Gulf of Alaska from 63,150 to 64,738 metric tons.

"A" Season fishing runs from January 1st to June 10th but includes long-line and offshore fishing.

Shore based processors expect to be finished A season fishing prior to February 1st.

Alaskan grounds prices are between $0.28-0.33 per lb. depending on fishing area which is up $0.03-0.05 in some areas.

Chinese demand is strong for H&G raw material with Chinese importers reporting current offers from Alaska at $2,500-2,700 USD per metric ton.

Despite the strong demand, there is a lot of push back at these prices as China is looking to pay $2,300-2,400 per metric ton. Alaskan processors will likely produce fillets vs selling at the lower levels as the return is greater. Current domestic fillet inventories are out of balance with high levels of unsold 32+ oz. fillets.

Prices on the larger fillets have been adjusted to the low to mid $3.00 level to stimulate sales. 8-16 and 16-32 prices are close to the same level as the larger fillets, which may make the 32+ a good value.

To date 5,772 metric tons have been harvested in the Gulf of Alaska which is approximately 9 percent.

---Whiting supply has been strained out of Argentina which has created an opportunity for marketers to push Whiting from Peru as an alternative.

The Peruvian authorities have set the 2013-2014 catch limit at 38,957 metric tons, up significantly from the 13,750 metric ton level set for 2013. El Insitituto del Mar del Peru made recommendations based on biomass recovery levels calling 2013 a transition year.

US importers have been looking at Peruvian hake partially because it's $0.20-0.25 per lb. less than Argentina product. Exporters warn that the quality of Merluccius gayi from Peru and Merluccius hubbsi from Argentina are not the same.

Gayi can have a darker color and a softer texture than hubbsi. It's worth noting that Argentina has resumed production after their government mandated closure for Christmas holidays and hubbsi will be hitting the US within 6-8 weeks.

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