Chinese tilapia prices see seasonal correction

As the peak harvest season approaches, prices in the main tilapia producing areas in southern China have generally fallen. Industry data show that in the 23rd week (June 2-8), the factory’s price of 500-800g tilapia in Guangdong was 8.5 yuan (about 1.18 dollars) /kg, down 0.3 yuan from the previous week; Guangxi also fell to 8.3 yuan/kg; Hainan's price temporarily stabilized at 8.2 yuan/kg. The price difference between the three major producing areas has narrowed to the 0.3 yuan range, creating more balanced cost conditions for processing companies to purchase across regions.

Market analysts pointed out that the price adjustment was mainly affected by changes in supply and demand. An executive of a large processing company in Guangdong said: "Last week's high price of 8.8 yuan was beyond the reasonable range, and the current correction is a normal manifestation of the market's self-correction." The executive revealed that the company strictly implements the "production based on sales" strategy and reversely calculates the purchase price of raw materials based on the price of fish fillet export orders. As the southern production areas will usher in a peak of concentrated listing in mid-June, it is expected that prices will remain under pressure in the short term.

Despite the high tariff of 55% maintained by the US market, Chinese tilapia exporters still said that it was "acceptable". However, Maoming  have begun to accelerate their shift to the domestic market. The latest statistics show that the total tilapia production in Maoming last year reached 280,000 tons, of which 70% was exported. The local government is cultivating the domestic market through programs such as school meals, striving to reduce the export share to below 50%.

This year, the sales volume of tilapia feed has increased significantly year-on-year, mainly benefiting from two factors: first, the overall favorable climate conditions for aquaculture operations, and second, the enthusiasm of farmers to stock tilapia, which has led to an increase in the number of tilapia stocks. People from Hainan processing companies said that although the current inventory of large-sized finished fish is limited, considering that new fish will soon be on the market, most companies choose to maintain the current price. "Some farmers may need to adjust their expectations for US orders," the person added.

Industry insiders predict that as new fish are gradually appear on the market, prices may continue to fluctuate slightly in the next two weeks. However, in the long run, driven by the continuous expansion of the domestic market and the upgrading of processing technology, China's tilapia industry is gradually building a more balanced production and marketing structure.

Reference : YUYIPAI