Seafood industry in China after zero-COVID policy

Executives in seafood industry in China are hoping for improvement in 2023 after a difficult 2022, a year during which Covid-related restrictions battled domestic demand

Lin Xiaowen, an executive from Hainan Eternal Spring Fisheries Co., said business has gotten worse ever since the third quarter of the year.

“Quarter one and two were good for the whole industry. Filleting, feed, farmers, and exporters. But sales dropped by a ton when the third quarter started. “

Market Trend Analysis seafood industry

Usually, the fourth quarter is the peak of the year. This year, though, overseas sales were low. Some importers said, due to the high price they still have inventory remaining high.”

Producer of Tilapia in Hainan said sales dropped by 20% due to “weak demand worldwide, especially in the U.S. market”

Lin said that the positive moment of 2022 was a sharp increase in demand in the domestic e-commerce market.

“While the overseas market remains our biggest market, the domestic market is doing better. Year by year we see the growth of it,” Lin told. “Traditionally, we sell through wholesalers, we use intermediaries. We also have customers such as supermarkets and restaurant chains, but this year we saw a significant increase in our sales through e-commerce.

Lin predicts a better year in 2023 based on increased entertainment and travel activity in China, which will lead to increased demand. Several investment banks, including Goldman Sachs, think that the resumption of the Chinese economy at the beginning of the second quarter of 2023 after the easing of China’s restrictive zero-Covid policy.

zero-COVID policy testing

Higher U.S. demand in 2023 is also a prediction of Lin’s. It is based on the decline in tilapia stocks reported by his clients. But whether or not the demand can be met depends on maintaining the current stock levels ability after the hit from the second year of 2022.

“Farmers are losing money,” Lin said. “The cost of feed rose every month in the past quarter but the price of fish has fallen due to weak demand. It’s now CNY 4.20 [USD 0.58, EUR 0.58] per 500 grams.”

Pablo Resnik, head of business at international seafood trader Roda International – said the fear of losing money has reduced the risk appetite of Chinese seafood importers as they struggled during the Covid pandemic. French investment bank Natixis believe that China will lift the majority of its Covid-related restrictions in the second quarter of 2023, leading to an upswing in economic growth.

Ocean treasure has big plans for 2023. We will continue providing top-quality products for competitive prices. Improve the customer experience in all spheres of our business. We will partake in world’s largest seafood exhibition – Seafood Expo in Barcelona. Continue developing our seafood, fruit & vegetable, and spices fields of business. And last but not least, we plan to make a huge announcement which will remain a mystery for now. Rest assured, next year will be eventful.

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