By: Les Hodges
The Canadian Snow crab prices hit all time highs this past week with heavy Japanese demand and rapidly increasing prices. U.S. retail and food service customers are adjusting to the new price levels and some Japan buyers are balking. Canadian 5-8 Newfoundland Opilio is now 28% higher than the same time period in 2015.
The same situation is happening in Korea where processed Russian Opilio is being auctioned off at $15-$16.00/kg ($6.80-$7.26/lb.). Some product has been sold direct-to-consumer using Internet marketing. At the same time, live deliveries of Snow crab and King crab have been strong with prices retreating as we hit summer.
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 “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. Next up should be Alaska Southeastern Dungeness crab.
Canada Crab Fishing:
The Newfoundland Crab Quota for 2016 was set by DFO @ 43,802 m/t down about 10% from last year.
The Japan buyers set the tone by increasing prices on a regular basis starting at $5.35 then advancing on a continual basis now near $6.00 according to Seafood.com. This has resulted in a pullback from some Japan buyers and reduction the amount packed for Japan. The harvest is behind the same period in 2015 with about 50% of Newfoundland product being processed. It is also said that processors are allocating crab for the U.S. market slowly with some walking away from long time retail and food service business for the short-term.
Norway Crab Fishing:
Live Red King crab shipments sales to Korea in April were 17 m/t. Year to date exports of live King crab to Korea are 301 m/t vs. 117m/t in 2015. Processed Snow crab exports to Japan were also up through at 364 m/t vs. 72 m/t in 2015.
Russian Crab Fishing
There are 47 Russian vessels fishing crab in the Far East as of May 15 plus a number of vessels fishing in the Barents Sea area for Opilio.
28 vessels were fishing Opilio in the Far East with 6 fishing live, 11, fishing boiled, and 11 fresh frozen for the Asia market. Blue King crab had 5 vessels fishing with 4 for the live market. On the other hand 7 vessels were on brown King crab, which were all boiled for the U.S or meat market. 7 vessels are fishing deep-water snow crab Japonicus (1) and Angulatus (6).
Overall in late May that 19% of the Russian crab catchers in the Russian Far East are fishing for the Asia live market. Shortages on medium size king crab should continue,
REGIONAL MARKET UPDATES >
The China market for live seafood continues to grow with primary high value items being King crab, lobster and Dungeness crab. Some Snow crab has been delivered, but this crab is not as strong as the other specie with higher reported dead loss. Some Russian shippers have developed infrastructure and holding tanks to handle the live deliveries.
There was a Fabiniyi study reported by Seafood Source that presented the spending power of the Chinese Seafood buyers. The Chinese income has been increasing at the rate of 5 to 10% per year over the last year and the study found that they are spending large amounts of money on seafood.
An agreement to shut down IUU crab deliveries to China was reached at the last session of the Joint Russian –Chinese Commission for Fisheries Cooperation. Details will be announced later this year.
The ¥ continues strong in 2016 and now sits at 107.2 ¥/USD as of 6/3/16. This represents a 12% increase since 1/1/16!
Japan crab imports year to date through April including meat are up 17% to 11,536m/t. Processed King crab and snow crab imports YTD through April were up 94% and 37% respectively to 1,662 m/t on king and 3,904m/t on snow crab. The strong ¥ has increased the buying power of the crab importers.
The effect of the Japan/Russia treaty on IUU fishing has caused the live King and Snow crab market in Japan to basically shut down. Only 9 m/t of live King crab and 40 m/t of live snow crab have been imported to Japan through April
Below listed is the live and cooked crab delivery schedule by Port for the week of May 24:
Next Port Product Quantity (M/t)
Donhe Opilio Live 35.0
Khasan Opilio Live 24.1
KHP Opiio Live 54.5
Lyuishun(China) Opilio Live 37.0
Dpmje Opilio Live 37.0
Neveljsk Blue King crab Live 27.6
Monbetu Blue King crab Live 45.6
Khasan Blue king crab Live 57.2
Both live King crab and Snow crab prices in Korea adjusted lower in April. Snow crab imports for April were 563 m/t. Prices continue to adjust down as summer approaches and it was reported that live snow crab prices at Donhe in late May dropped to $12.00/kg. This compared to April where the average price was $16.17/kg.
Prices on Russian live King crab also dropped in late May to $18.00/kg from $29.15/kg in April. Russian live King crab deliveries were 203 m/t. Total crab imports to Korea year to date through April are 7,780m/t. Of that 5,000 were live crab deliveries headed by Chinese swimming crab with 2,310 m/t.
U.S. imports of King crab from Russia through April are up 154.5% at 11.480mm lbs. vs. 4.511mm for the same period in 2015. A large portion of this has been large Red King crab. For the month of April imports were down vs. April 2015 at -47.3% to 1.152mm lbs. Argentine Santolla red crab was -6% in April vs. prior year to 501.6mm lbs. Year to date Santolla is off -25.3% to 1.714 mm lbs. vs. 2.296mm lbs. in 2015. Total King crab category is up 92.1% through April at 13.275mm lbs.
Large size U.S. and Russian King crab prices were again stable in April according to Urner Barry. However, medium and small Red and Brown King crab prices continued to increase and are now 26%-38% higher than the same time period in 2015. Some trade factors have moved to the larger 4/7,6/9, and 9/12 count size as prices compress. Clearly, the best value today is in the larger sizes!
The Russian Red King crab supply for the U.S. going forward will continue to be tight due to the impact of the live crab business in Asia. Only Brown King crab has no live market and will come to the U.S. unless it’s purchased for the King crab meat market. Brown crab fishing has been good and we expect most will come to the U.S.
Alaska King crab is finished and in limited hands. Demand for Alaskan crab is steady with a price premium on Alaskan over Russian product. Sellers are allocating as the inventory must last until new season.
Snow crab led the way at retail in May at retail chains representing 65% of crab ads followed by King crab with 35%.
Urner Barry reported that Newfoundland Snow crab 5-8 sections were at the highest price ever recorded for June @$6.15/lb. Boston. The picture below says it all!
Snow crab imports from all sources were up through April compared to 2015 by 120.2% or 17.583mm lbs. The largest increases were from Canada up 218.3% year to date at 10.409mm lbs. followed by Russia at 4.212mm lbs.
The early containers from the Canadian Opilio season reached a dry market. High prices for Alaskan Opilio, and very high priced Japan Canadian contracts have continued to push the prices of Canadian Opilio sections, and restricted exports to the U.S. market after the Japan contracts were signed moved prices to all time highs by June 1. Some processors are abandoning or restricting exports to the U.S. and prices are increasing on a continual basis. At the same time, we may have reached the tipping point as there is a reported pullback in Japanese buying.
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:
Argentine Southern Red crab that is reported under the King crab category is up and deliveries of new season Santolla continues although at slower rate than 2015. Imports for April were 502.0mm lbs.
The price of Dungeness sections are lower than the same time period in 2015 at a UB reported $9.15-$9.40 vs. $9.70-$9.90.
While Oregon had a good year in spite of the one-month delay for domoic acid, California fishermen face a financial disaster due to the very late openings.
Due to the long delay in opening, the fishermen in Monterey were able to fish for only a short period of time before pulling their gear to avoid tangling Humpback whales in their gear. In short, the season is basically over…
There remains only limited supply on both clusters and whole cooks.