EP 208 | AIRED 11/10/2014
Flounder Raw Material is Extremely Short; Dramatic Change Ahead for Pangasius
November 10th, 2014 This week in the Tradex Foods 3-Minute Market Insight, Rob Reierson discusses Flounder Raw Material is Extremely Short; Dramatic Change Ahead for Pangasius...
--- This week we will update you on the Flounder market and briefly touch on the new Pangasius laws.
Chinese processors advised last week that Flounder raw material was coming in extremely short.
The Flounder market is down so although raw material is short, finished inventories are excessive due to slow movement worldwide.
Recently it has been difficult to find sizes over 5 oz as 75 percent of the raw material typically yields a 3 oz fillet or smaller.
The difficulty finding larger sizes translates to higher price points. Larger sizes, 500 grams and up, are $1500 / MT, whereas the 150 - 300 and 300 - 500 gram sizes are around $1300 / MT.
For the customer, these prices mean roughly $0.25 / LB variance between finished fillet sizes.
For larger sizes, prices FOB Boston are in the range of $2.70 to $2.90 / LB. Finished products for smaller sizes are between $2.40 and $2.60 / LB FOB Boston.
Flounder is particularly popular in South Eastern USA, sold either skinless or skin-on.
In the single frozen market, few Alaskan packers are producing Flounder as a fillet. Because the product comes in at various sizes it has to be hand cut, which often adds up to $1.25 / LB above the current cost.
Argentine Flounder supply is down this season due to shortages of raw material.
This product became popular as a market substitute when Pacific Flounder harvests were coming in at small sizes.
--- A new Pangasius law was signed in in June, that will go into effect on January 1st 2015.
The new law requires an acceptable moisture level of no greater than 83 percent. Currently, most of the Pangasius product coming into the USA has moisture levels of between 84 and 86 percent.
As such, a common spec is 85 percent moisture plus or minus one percent.
The law also goes one step further to require exporters to purchase from approved farms, beginning in January 2016. These changes are sure to have a strong market effect over time.
--- Finally, keeping in line with this week's topic, our suggested buy this week is for single frozen Alaskan skinless boneless IQF Flounder fillets.
Smaller sizes like 2oz and 3oz are going for $4.00 / LB and $4.25 / LB respectively.
The 4oz and 5oz sizes are $4.90 / LB, and 6oz Fillets are just over $5.00 / LB.
All prices are FOB Seattle. Contact your Tradex Foods Rep today to place your order.
--- Tune in next week when we review the China Fisheries and Seafood Expo, that was held last week on November 5th to 7th in Qingdao, China.
---Thanks for joining me for the Tradex Foods
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