As the leading exporter of tilapia fish from China, Ocean Treasure witnessed tilapia prices getting higher and higher in the almost last one and half years. There price increase for this fish is mainly these reasons: Huge demand, Freight cost, Raw material situation, and fish meal price level.
The freight cost is the biggest problem. It affected all the prices in the fish and seafood area. With the vast demand from the USA, Tilapia exporting number is increasing so fast after the recovery from the pandemic. And this vast demand helped tilapia price increase again and again. The FOB price of Tilapia has increased 31.4%. Now plus the freight cost, the price level is almost 150% as the preview price level.
Last two weeks, due to the sky-high freight cost, there was some hesitation between the importers and the exporters felt the trend, so they tried to decrease the raw material price and tried to keep the price not increasing (because the freight cost increased so fast). Due to this action, the purchase wave again came, and factories kept the high volume of orders. The raw material price decrease was the first time in the last one and half years, and it just stopped in ten days. Then the price increased again.
The bad news is the price may keep increase because tilapia farming met issues now.
The environment protection restriction.
The Chinese government is trying to control the farming land of Tilapia to prevent the water system. This restriction will again affect the raw material situation in the new season.
The bad weather and storm in the farming area
The weather these days is too hot in the Guangdong Province. Like in the winter for the cold weather, nearly half of the Tilapia was dead because of the cold weather. At this time, it’s not that much, but still, the raw material situation suffered a lot. The small size and the big size are in a shortage.
The pandemic situation in China recently
Due to these days’ situation in Guangdong province, the pandemic starts to affect tilapia processing. There are some factories already received the notice that they need to close the production line. In this situation, the efficiency of the orders is getting lower.
The general situation now is that due to the high demand from the USA, the tilapia price will stay at a high level. But the problem is that the USA’s purchasing power is vast because of the USA’s financial policy; for other countries, the importing number of Tilapia is not that strong. Instead, the offer of panga is increasing, and the price of panga is still at a low level. Imaging in 2019, the price of Tilapia and panga are at a low level, and they are what we called cheap fish. But now, the Tilapia is not cheap anymore.
As we mentioned, the raw material price started to decrease a bit. What does that mean? It means Tilapia’s importers are close to the bottom line of the price availability. They are hesitating about the price and want to find the substitutional product at a low-price level. And exporters are trying to attract the orders back by using price strategy temporarily.
So if the tilapia price keeps increasing, the market share will change. Maybe not in the USA, but in other countries, there is a high possibility.