EP 274 | AIRED 03/07/2016
Raw Materials Forecast Pricing Horizon After Chinese New Year
March 7, 2016 - Welcome to The Tradex Foods
"3-Minute Market Insight
This is Robert Reierson and here is the seafood news for the week of March 7th, 2016.
--- After a 5 week blackout period during Chinese New Year, Chinese processing plants have resumed operations which means new workers, new raw material acquisition, and new pricing.
High employee turnover forces an annual training period for new workers, but the Plants should be running a full speed by now.
This year however, counter to what we previously reported on, many of the larger processing plants are only running at HALF capacity due to employee shortages.
--- Another recurrent theme is the mounting debt that is crippling the larger supplier's abillity to purchase raw materials.
We spoke with a large Pollock processor who just had their credit cut in half, leaving an unfavourable situation for the new year.
Decreasing purchasing power and the annual standstill during Chinese New Year leaves many North Amercian buyers looking for supply alternatives.
Eastern European countries, most notably Poland, Lithuania, and the Ukraine, are rising hubs for affordable and reliable production throughout the year.
Keep an eye out for these emerging markets.
--- Our TradexLIVE offer of the week is for 6-8oz IQF Sinbad Haddock Fillets.
These are twice frozen, packed 1x10lb, and cut from Frozen At Sea wild caught raw materials.
We have 8,000 lbs available in Boston for $2.70/lb USD.
Click or tap the icon above to view this offer.
--- Over to Kyla now for a look at pricing out of China.
--- Atlantic Cod is still going strong as Norwegian harvests are poor.
As we have mentioned previously, there could be opportunities to switch from Atlantic Cod to Haddock, as currently there is a $1400 per metric tonne variance between the species, which is about a 63 percent premium.
IQF Haddock loins are at $2.75/lb in Boston right now, whereas an Atlantic Cod loin is in the $3.60 - $3.70 /lb range.
Pacfic Cod supply is short right now so pricing looks to be strong after Chinese New Year. Chinese suppliers are paying $1.27 /lb for shore frozen 4lb+ H&G Cod.
4-8oz Shatterpack Pacific Cod Fillets from Alaska raw materials are at $3.15/lb in Seattle, with deep skinned offers at $3.35/lb.
As for Pollock, Russian sourced raw materials continue to be weak, whereas Alaksan product typically has a 20 percent premium.
With the recent push for proper Alaska Pollock labelling, raw material prices jumped immediately by 12 percent.
Russian fish will NOT have the marketability to push their prices up to meet this level, but it's unclear if the consumer market is prepared to accept a price increase based on catch area.
To further complicate the situation, the Russian Government is proposing an export tax of $0.30 /kg to stimulate domestic consumption of Russian fish - a sure-fire way to increase global Pollock pricing.
Los Angeles market pricing on IQF Alaska Pollock fillets are at $1.25 / lb - buyers should be wary of any offers they see in the lower $1.00 range as the product is likely to be a higher moisture content.
Back to you Rob.
--- Thanks Kyla.
----Thank you for joining me for the Tradex Foods
"3-Minute Market Insight"
This is Robert Reierson - “BUY SMART” and “EAT MORE SEAFOOD
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