EP 282 | AIRED 05/02/2016
We Have Unlocked The Haddock Mystery
May 2, 2016 - Welcome to The Tradex Foods
"3-Minute Market Insight
This is Robert Reierson and here is the seafood news for the week of May 2nd, 2016.
--- North American Haddock buyers continue to search for market demand during a puzzling price floor that has lasted nearly 6 months now.
Haddock raw material pricing was a hot topic at the Brussels Seafood show, which wrapped up last week, so we contacted packers in China to get information direct from the source.
We asked Chris Liu, our Vice President of Asia Operations in our Qingdao Office, about the outlook for Haddock pricing.
[Chris clip 0:15-0:49]
"The product pricing probably will go up, pretty soon. Because Haddock has been at this low level for more than 6 months already. I talked to some packers and asked them for their opinion, they think that Haddock has been fluctuating, the pricing. That's why it's so risky to do it right now."
We saw Haddock raw materials reach $4,500 / mt last year, and it's dropped dramatically to about $2,100 where it currently sits.
Even at this price floor, demand is stagnant, so we asked Chris to talk to a leading Haddock packer to see what it would take to jumpstart the market again.
[Chris clip 3:27- 3:44 about demand]
"He thinks, once some buyers in North america or in Europe start buying, they will trigger the market right away. And the price will go up $1000 /mt easily."
In the meantime, European demand for whitefish is being filled by Pacific Cod, which is more stable.
[4:27-4:40 about pacific cod]
"Pacific Cod, the pricing is a little higher than Haddock, but it's more stable. The raw material of Pacific Cod has been at this level for 2 years already."
Haddock used to be substituted by Atlantic Cod, but volatile pricing and poor harvests for frozen production have some Chinese processors concerned.
[5:28-5:54 about atl cod]
"Most of the quota of twice frozen fish went to the fresh market. So there will be less quota for twice frozen Atlantic Cod and the catch is poor. So the pricing probably will go up. And some packers told me it will easily more than $4,000 /mt this year."
--- Cod exports from Norway were strong in the first quarter, 48 percent over the same time last year, but large volumes of the quota did go to fresh sales and salted production.
--- However, Haddock supply is good, especially in the summer months.
The 2016 Total Allowable Catch is up 24 percent from last year at 223,000 metric tonnes.
--- Even with steady supply, Haddock pricing is all over the board in the North American market.
In January, Haddock loins in Boston were around the $2.80 mark. Since then, inventories have backed up from decreased demand, resulting in wide spot pricing ranging from $2.50 - $2.65 / LB.
--- On the West Coast, Haddock pricing has slowly dropped over the last four months, to a price variance from Pacific Cod loins of about 10 cents per pound.
In Vancouver, the market closed last week at $2.75 USD / lb for Pacific Cod Loins and $2.64 USD / lb for Haddock Loins.
It's unlikely that we will see demand transition back to Haddock for contract business because of the stability of Pacific Cod, but many price sensitive buyers could make the switch for opportunity purchases.
--- To wrap things up, our TradexLIVE offer of the week is for Sinbad Brand Haddock Fillets.
We have several sizes avaliable in Boston for $2.70 / LB USD.
Click or tap the icon above to view this offer.
----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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