Tilapia price drops 10%, Covid Hits Guangdong Again

Prices recently decreased in the Chinese tilapia industry due to changes in exchange rates, freight fees and current epidemic conditions. Last week, Covid cases have risen in Guangdong province. As the largest aquaculture base in China, tilapia prices have dropped10% in the wake of a new lockdown there.

Tilapia is an available, mild-flavored fish. It is the fourth most consumed type of seafood nowadays. Tilapia fillet can be processed into skinless, boneless fillets. Simple quality-control procedures are known to be effective in ensuring the quality of fish entering the market. Additionally, Tilapia have very low levels of mercury, as they are fast-growing, lean, and short-lived, with a primarily vegetarian diet.

China accounts for the majority global tilapia market with just over 20 percent of global tilapia production. The areas of Hainan and Guangdong historically are used for tilapia farming.

As of 2016, 30,000 hm2 of Hainan Province was devoted to aquaculture- with pond culture mode accounting for 80%, and the remaining 20% split between cage culture and reservoir culture. Having a climate suitable for year-round aquaculture, Hainan is the 2nd largest of China’s tilapia exporting provinces. The annual processing capacity of aquatic products exceeds 800,000 tons.

Guangdong province, with its high-quality water resources, has bred a unique regional tilapia industry. Guangdong’s Maoming City is the largest tilapia production base in China. In 2020, the city’s tilapia aquaculture area was about 260,000 mu, with an output of 231,300 tons; tilapia exports accounting for 95,000 tons. The value of goods is about 300 million USD, and the comprehensive output value of the tilapia industry is 6.44 billion CNY.

However, after a 2-month lockdown in Shanghai, Covid cases are now appearing in Guangdong. Some cities like Zhanjiang and Maoming are now initiating similar lockdown. Within the Tilapia industry, workers are now restricted in their movements and suppliers are concerned about short-term production ability. The material price is dropping as the fish needs to sell quickly – in order to avoid increasing and continued feeding costs and the potential of having fish too large for market requirements.

It is hard to predict the near future price trend. Ocean Treasure experts are constantly monitoring the situation. Our analysis is that if there is a substantial increase in local Covid cases, the lockdown will last longer- and as such, factories have no option but to reduce the price. If there are no positive Covid cases within span of 14 days, the lockdown will end, and the price of Tilapia will again be influenced by purchasing power alone. As May is seedling season on the tilapia farms, this is traditionally the month where we start to see annual sales begin an upward trend in this category. Currently with the strengthening of the USD, coupled with decreasing freight fees- factoring in pandemic’s “need-to-sell” conditions creates the perfect opportunity for the best deals to be had.

Stay tuned with Ocean Treasure, we will keep posted on it:

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