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Fishmeal Market
Report - September 2007
Further decline in production
In 2007, world fishmeal production continued to decline further. The five
main exporting countries reported 1.8 million tonnes output in the first
seven months of the year, which is a 3% decline over the corresponding period
of 2007. This decline was caused by sharp drops in production in the
Scandinavian countries and Chile, while Peru reported
for the first time, higher production. Despite lower production, prices of
fishmeal declined in the course of 2007. This was caused by high stock of
fishmeal in China,
the main market, while Peruvian producers were trying to sell at discounted
prices. However, prices are likely to have bottomed out at their present
level of US$ 1 050./tonne.
Earthquake shakes Peruvian industry
In Peru,
however, there is speculation on how the earthquake in August 2007 may have
effected the anchovy biomass, but news is only expected after Imarpe completes its research cruise around the end
September. The estimate of the SNP is currently for a quota of 2 million
tonnes, at the same time commenting that it is difficult to say taking into
consideration the past events with the earthquake. The earthquake hit one of
the main production areas, Pisco, and resulted in
destruction of boats and facilities, in the addition of loss of human lives. The
Peruvian fishmeal industry has thus many more important problems at the
moment than mere selling of its product.
Despite declines in production, Chilean fishmeal exports stayed stable in the
first half of 2007 when compared with the same period of 2006. China
continues to be the main market for Chilean fishmeal, despite the relatively
high prices of this product. Chile produces
a high value fishmeal, well accepted by the Chinese aquaculture industry.
Price drops in 2007
As a result of weak demand in China,
fishmeal prices have declined throughout 2007, from US$ 1250/tonne in
December 2006 to US$ 1050/tonne in September 2007. This should be now the end
of the downward spiral, as Chinese traders are reported to be looking for
fishmeal supply for the booming aquaculture industry there.
Little buying interest in Europe
and the USA
Buyers in Europe
or USA
are not willing to compete with Asia
for fishmeal supply, and overall imports have gone down in the first half of
2007 when compared to the same period of 2006. It is expected, however, that
some more buying interest will emerge, now that fishmeal prices have dropped
to a more acceptable level.
The European Parliament on 13 July 2007 called for the lifting of a ban
on feeding fishmeal and fish oil to cattle, goats and sheep. The European
Parliament backed a report by Conservative MEP Struan
Stevenson which said there was no scientific evidence that using fishmeal and
fish oil in feed for ruminants posed a risk of transmitting BSE - mad cow
disease. The report said strict controls in the wake of the mad cow crisis
have ensured the safety of the food chain from contamination by dioxins, and
that fishmeal is rich in essential amino acids which give health benefits to
humans and animals. Also FAO, the United Nations’ Food and Agriculture
Organization, had on various occasions underlined that there was no
scientific evidence that using fishmeal and fish oil in ruminants’ feed could
create a risk of transmitting BSE.
Among the European countries, Germany
continues to be the main fishmeal importing countries, but trade has slowed
down in 2007, following the overall trend. Peru continues
to be the main fishmeal exporter to the German market, capturing over 90% of
total fishmeal supply to the German market. UK fishmeal
imports were cut by half in the first six months of 2007, due to lower
imports from Peru
and Germany
(re-exports of Peruvian fishmeal).
The US
market for fishmeal reacts quickly to any price developments. In 2007, the
price level reached by Peruvian fishmeal was considered as too high, and US imports
from this country in the first half of 2007 collapsed from 11 200 tonnes to a
mere 100 tonnes. Also Mexican fishmeal exports declined sharply, mainly due
to the presence of higher water temperatures. It is likely that the USA will buy
somewhat more fishmeal in the second half of the year. Thus total fishmeal
imports should be around 50 000 tonnes, still one of the lowest in recent
history.
Higher prices likely in coming months
Fishmeal production in the second half of the year and in the opening months
of 2008 is expected to be lower than the previous year’s
levels. Apart from the disappointing catches in Scandinavian, also South America is expected to produce
less. Prices should thus have bottomed out, already now traders in China report
sharply reduced stocks and strong buying interest. On the other hand,
provided prices stay around the US$ 1000/tonne level for some further months,
Europe and USA should
restart their buying of fishmeal.
By Helga Josupeit
© FAO GLOBEFISH 2007
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