By: Paul B. Brown Jr.*
Tilapia Fresh Fillets
When removing imports from China (mainland) entirely—but leaving imports from Taiwan—imports in August decreased 3.7 % from the previous month, and 5.3 % from the same month a year ago. On a YTD basis imports are 4.6 % lower compared to last year—again, when removing China (mainland) from the picture. Imports from Ecuador remain 23 % below last year’s figures while those from Costa Rica only at 3.2 % lower. Imports from Brazil have been increasing as of the last few months with YTD figures at 2.2 million pounds as of September 2016. Shipments from Colombia are down 1 % YTD.
From a replacement cost basis, we made some adjustments to the figures published in the past and weighted the import $ USD/lb. including only the top 5 suppliers. What we found is that September’s figures, at $2.77 USD remained flat from the previous month. The market in the U.S. is under downward pricing pressure and the market adjusted lower one week before Thanksgiving.
Tilapia Frozen Fillets
September imports decreased from the previous month following a seasonal pattern with monthly imports still falling at consistent rate since April 2015. On a YTD basis imports are down 15 % from the last year; imports from China, the largest supplier, are also down 15 %. Supplies in the U.S. remain adequate according to many importers, in addition to offerings from recent harvests also remaining steady to full steady. Replacement prices dropped to $1.55 USD in September, reaching the lowest monthly replacement cost since January 2010. The market in the U.S. remains flat.
Over the last 9 years, import volume for tilapia has increased at the same time that the ratio of wholesale prices to replacement has declined. In fact, this ratio reached its lowest point on record in January of this year. Yet, over the last 6 months, falling replacement prices have caused this ratio to move higher; in other words, at constant wholesale prices, falling replacement costs have eased the spread between import and wholesale prices with September ratio reaching 1.20, a level not seen since November 2014. Volume imported has been contracting since 2014, largely due to record high prices that year which could lead us to assume—empirically—that demand for tilapia waned off at those higher prices. If prices are to rise overseas again, as many have suggested due to shrinking margins by farmers and packing plants, the U.S. wholesale market might not be able to absorb high prices with seasonally rising volumes.
Imported Channel Catfish
Imports of frozen channel catfish fillets increased as seasonally expected reaching nearly 400 thousand pounds. While this number was significantly higher compared to the same month last year, YTD remain almost 20 %t below last year’s figures. Shipments in August entered the U.S. with a declared value of $3.13 USD per pound, 10 cents down from the previous month. The wholesale market remains steady at listed levels.
September imports increased significantly from the previous month, totaling 27.4 million pounds reaching the second highest monthly figure on record. Total YTD imports are at 213.8 million pounds, also a record high and 23 % above last year’s figures. Imports of pangasius are only 2.8 million pounds short from those of tilapia frozen fillets.
European data revealed imports of pangasius increased slightly in August (most recent data) from the previous month, and remain below U.S. imports. On a cumulative basis, data shows that U.S. imports are above those from Europe by approximately 32.2 million pounds.
Replacement prices dropped significantly in September and reached $1.178 USD/lb. down 77 cents from the previous month, according to the USDOC. Although anecdotal reports suggested replacements costs were bound to move higher into late Q3 and Q4, September’s drop certainly questions such claims; however, we still have to account for all Q4.
*President of Urner Barry