By: Les Hodges
Crab & Seafood Market News Summary:
Medium and small size Red King crab prices in July continued to increase in the U.S. and compress the price differential between the small crab and the very large 4/7, 6/9 and 9/12 count Red King crab. The Asia market demand for live King crab has simply decreased the amount of processed small and medium size product available for the U.S. market.
Snow crab fishing is about over in Canada. Japan has taken about 30-35% less from this source due to quota declines and higher prices. At the same time Japan buyers increased their purchases from Russia and other production sources and overall Japan imports are up. Good U.S. demand for the remaining Canadian Snow crab has created an overheated market.
This newsletter is divided into two sections: one, a section on “REGIONAL CRAB FISHING” which details the latest harvest data; and two, a section on “REGIONAL MARKET UPDATES” which discusses imports, marketing trends and more.
REGIONAL CRAB FISHING >
Alaska Crab Fishing:
The Bering Sea crab fisheries for 2015/2016 are finished. Southeastern Dungeness crab fishing has been very slow to date with quality and size being excellent.
Alaska Gold King crab Aleutian Island season opened on August 1. The TAC is split between Eastern and Western zones using 174-degree longitude. The Eastern zone remains the same as 2015 at 2.979mm lbs. with the Western zone reduced 25% to 2.2mm lbs.
Canada Crab Fishing:
Newfoundland snow crab season is basically done with 89% of the quota being harvested and its doubtful that the entire quota of 42,650 m/t will be achieved. Sections from the Gulf are also said to be down 30-40% vs. 2015 although total harvest was taken. In total, it is expected that Canadian sections available to market will be down about 15%.
Norway Crab Fishing:
The Norway King crab fall season begins on August 15 and we will be processing Red King crab at our Norway production facility.
Overall, the Norwegian producers were successful in the first half of the year in generating deliveries to 383 m/t of live Red King crab to Korea and 139 m/t of processed to Japan. The Japan market received 717 m/t of Opilio Snow crab. A similar amount was shipped to the U.S. and E.U.
Russian Crab Fishing
It is basically the off-season now for Far East crab fishing. The vessels fishing are at the lowest level in a year at 22 vessels. Of that number 10 are fishing for the Asia live market.
4 vessels are fishing Red King (Ayan) for the live market. 1 fishing Blue King crab for the live market, 2 vessels fishing Brown King crab for the processed market, 6 fishing Opilio all but one for the live market, and the 8 vessels on deep water Angulatus and Japonicus for the processed market.
In total 40% of the crab processors are fishing for the live crab market in China and Korea.
The rest of the fleet are preparing for the fall Red King crab fishery that begins September 1. Most are stating that they intend to fish and deliver as much live crab as possible to the Asia market and the processed market must compete.
There is a proposal before the Russian government to open commercial crab fishing within the Russian Coastal EEZ to small vessels with further processing on shore. Although intended to provide more crab for local communities, many expect most to be exported.
REGIONAL SEAFOOD MARKET NEWS >
China Seafood Market News:
Russia and China finally signed an agreement on controlling supplies of Russian crab to the Chinese market. China imported 3,000 m/t of Russian crab in 2015 according to Seafood.com and this agreement could allow this number to increase while IUU deliveries drop. The Russian Rosrybolovstvo has completed a list of Russian companies who can export legally to China.
Japan Seafood Market News:
The ¥ continues strong in 2016 and now sits at 100.8 ¥/USD as of 8/1/16. This represents a 17% increase in value since 1/1/16!
Japan crab imports year to date through June including meat are up 12% to 11.5m/t. Processed King crab and Snow crab imports YTD up 72% and 25% respectively to 1,814 m/t on king and 9,815m/t on snow crab.
The Canadian Snow crab season volatility and strong U.S. market resulted in a cut in the overall supply of Newfoundland crab much of which is shipped to China for meat production. The total is expected to be about 6,000 m/t with 2,000 split at about 60% cooked brine frozen and 40% raw frozen crab. Most cooked Snow crab is sent to China for meat production and raw frozen for restaurant usage.
Russia is the largest exporter of Snow crab with product coming from both the Russian Far East fishery and the Barents Sea area fishery. Total imports from Russia through June are 4,938 m/t (10.886mm lbs.).
Prices on Opilio range from $14.00-$16.50/kg X warehouse Busan depending on pack and quality. Many Japan traders have given up at these prices.
Japan imported only 83m/t of live King crab and 357 m/t of live Snow crab through June.
Korea Seafood Market News:
Total imports of all crab to Korea in 2015 were 22.183 m/t of which 40% were live crab deliveries. Mid year through June 2016 finds continued growth in live crab deliveries that are now 62% of total Korean crab imports.
June 2016 shows 11,512.1m/t of crab were imported vs. 12,103 m/t in 2015. This is a -15% in total volume year to date. With the continuing growth of the live crab business it is expected that the gap will be filled with total imports of live exceeding 2015.
Prices of live King and Snow crab are up 40% and 15% year to date. King crab imports are 2346 m/t and Snow crab 1,773 m/t.
U.S. Seafood Market News:
The holiday season will be here soon and Keyport is planning crab production and promotions for this important sales period. Please contact your sales representative for details.
U.S. imports of King crab from Russia through June are up 72.9% at 15.160 mm lbs. vs. 8.767 mm for the same period in 2015. For the month of June Russian King crab was down -51% vs. June 2015 to 1.210mm lbs. Total King crab category imports are up 31.8% through June at 17.154mm lbs.
Medium and small size King crab prices continued to move up while the larger 4/7,6/9 and 9/12count Red King crab moved within a fairly small constant range. This past month it was clear that upward price pressure is happening on large crab as customers shift up to the better value larger sizes.
A comparison of January 1, 2016 on Russian red King crab shows that the spread between 14/17 Red King crab and 9/12 Red King crab was $1.95 lb. By July 28th this spread had dropped to $1.15/lb.!
Alaska Red King crab is finished and in very few hands. This item continues to sell at a premium vs. Russian. Sellers are now allocating, as the inventory must last until new season. New season on Alaska Brown King crab just started so will be a while until we see new production.
We expect continued tight supply on medium and small king crab even with the increased quotas due to the live crab business in Asia. Vessel owners intend to sell as much as possible to the Asia live market to the loss of supply for the U.S.
Only Brown King crab has no live market and most will come to the U.S. unless it’s purchased for the King crab meat market. Brown King crab fishing has been slow but steady and we expect most will come to the U.S.
Snow crab led the way at retail in July at retail chains feature ads with 77% of the activity followed by King crab with 23%.
U.S. Snow crab imports in 2016 from all sources continue up through June compared to 2015 by 8.8% or 70.961mm lbs. This compares to 65.246mm lbs. in 2015.
U.S. Imports from Canada for June 2016 were 18.657mm lbs. down -54.1% vs. June 2015 which was 40.660mm lbs. Canadian exports were trailed by Russia at 1.217mm lbs. and Norway at 665k.
Keyport has just produced some excellent large Russian 12up and 14up Bairdi sections. Quantity is limited on this item.
There is limited open inventory on Canadian Opilio and the market seems to be stabilizing.
Russian Deep-water Japonicus and Angulatus snow crab inventories in the US are lower than last year at this time as some offloads are staying in Korea.
Santolla Southern Red crab:
The imports of this Argentine production were only 33k in June and 1.825mm year to date. The price of this item has moved up while volume has decreased by more than 55% and is no longer the value play at retail and food service.
The price of Dungeness sections adjusted down slightly in July with price level now in the $8.75-$9.00 level range with whole cooks pricing being stable. Supply remains limited on both sections and whole cooks.
The small Southeastern Alaska fishery is now open and the sections are big and clean averaging 8-10oz with excellent meat infill.