Thaifex 2017: Tough times for tuna, but shrimp sector looking up

IntraFish reported from this year's World of Seafood in Thailand.

Friday, June 2, 14.30 pm ICT

Tough times for tuna companies

Thai tuna canner Capital Food International is, as many others, struggling with the prices of raw material.

Skipjack prices are at the moment above $2,000 per metric ton, a price that small companies can’t deal with.

“There is very little availability from local fisheries, and Thai vessels are not fishing in Indonesian waters, so the raw material is not enough,” Suwannee Khongkaew, managing director at the company said.

“At the moment, it’s only big companies importing large volumes, and the small ones have no chance,” she said.

And the situation is not getting better.

Pavena Banlagsak, marketing director at Thai tuna canning company A.E.C. Canning, also agreed that it is a “tough time” for tuna producers.

“Skipjack prices are very, very high, raw material is low and companies cannot get more product,” she said.

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Friday, June 2, 12.30 pm ICT

Thai fresh salmon consumption booming

A surge in Japanese restaurants in Thailand, especially in Bangkok, is boosting Norwegian fresh salmon exports to the country, Jon Erik Steenslid, representative of the Norwegian Seafood Council (NSC) in Southeast Asia told IntraFish.

Norway has 90 percent of the market share in fresh salmon sales in Thailand.

While five years ago, 80 percent of exports of Norwegian salmon to Thailand was frozen, to be reprocessed and sold to other markets, this year, 80 percent fresh and mostly staying on the domestic market.

In Bangkok alone, there are over 1,500 Japanese restaurants, and around 50 percent of the sushi sales are salmon, said Steenslid.

“Thailand is booming as a market,” he said. "It is the second time we come to Thaifex and we have increased our booth, added a show kitchen and are representing 12 Norwegian companies.”

However, there’s still a big challenge for Norwegian exports, which make up 90 percent of the fresh salmon market share in Thailand: people are not aware of the product's origin.

“Because it is sold in Japanese restaurants there is an assumption that the product is Japanese, and our goal is to make sure people know they’re eating Norwegian product.”

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Thursday, June 1, 6.57 pm ICT

It’s all about raising awareness

At the moment, the Thai consumer is not very aware of sustainability issues or solutions, but with the help of recognizable logos such as the MSC blue label this seems to be changing.

“I’ve just talked to a hotel manager who said they only work with sustainably caught fish -- this is very rare in Thailand,” Sea Value's Wannasiri Aramwattananont told IntraFish.

Sea Value launched a range of canned tuna products featuring the MSC label for the Thai market under its Super C Chef three months ago.

“It’s going very well, we are differentiating our product in the market with the logo, and although the MSC factor is not a driving factor at the moment in purchases, it's good to show that the product is sustainable,” she said. 

The new range comprises canned yellowfin tuna caught locally, in different formats including tuna in spring water, tuna in olive oil, and tuna in soybean oil.

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Thursday, June 1, 6.29 pm ICT

Could aquaculture become a thing in Taiwan?

Almost all the shrimp consumed in Taiwan comes from Vietnam. Meanwhile, the majority of Taiwanese seafood output comes from wild fisheries.

Stenly Yonardi, from the Taiwan International Fisheries and Seafood show, is at the Thaifex fair recruiting visitors and exhibitors for this year’s event, which will be held on Nov. 9-11.

The main objective for organizers is to “educate the industry on aquaculture” in order to shift production from fishing to fish farming.

Taiwan does a small amount of tilapia and grouper farming, but the country is in talks with the Vietnamese Association of Seafood Exporters and Producers (VASEP) to collaborate in sharing knowledge on shrimp farming, which could benefit Taiwan.

“In Taiwan we consume shrimp, and we would like to learn from producing countries such as Vietnam, and to encourage people in Taiwan to farm more [seafood species] themselves.”

The show is about sustainability throughout the entire production, from catching and farming to marketplace, and Yonardi said it is important to switch to farmed fish and relieve some of the pressure on wild stocks.

“This is our idea mainly for the southeast Asia region.”

So much so that the organizers of the show are offering different promotions, including accommodation for the three nights to some visitors.

“We need to show people how complex sustainability is, and what can be done to help the seafood industry.”

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Thursday, June 1, 5.40 pm ICT

Squid prices remain high across the board

According to China-based seafood trader Kingsun, current prices of different squid species are increasing due to the low availability on raw material.

This has been an ongoing trend, Kingsun CEO Jet told IntraFish, but they're now reaching "crazy" levels.

The price of Argentinean Illex squid for sizes 200g-300g are around $3,800 per metric ton, with very little availability.

However, despite the high prices, demand remains strong, especially in China.

“China pays for everything, if there was more, they would buy more,” Jet said. “There’s always more demand than supply.”

Kingsun also trades giant squid caught in Peru by Chinese vessels, and different types of loligo.

“Prices of all species are up, because there’s a shortage of raw material.”

In Europe, however, the trend is different, with importers being reluctant to pay the high prices, he said.

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Thursday, June 1, 4.55 pm ICT

'To use forced labor is the producers’ choice’

It's as simple as that, Wannasiri Aramwattananont, marketing executive at Sea Value, told IntraFish.

Sea Value has shifted completely to in-house production, including peeling, to ensure forced labor is not used in its supply chain.

In the same way, the group only sources its fishery products from vessels that operate according to the law, she said.

“One has the choice to purchase products from small vessels that cannot prove whether they operate the right way, or from big vessels with everything in order.”

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Thursday, June 1, 4.15 pm ICT

Surapon Foods invests in new frozen sushi production lines

“A lot of things are changing at Surapon Foods with the new management structure,” Auhtaphon Ratana-Arporn, assistant managing director of marketing at the group, told IntraFish.

At the beginning of the year, the group’s former CEO Surapon Wongwattanaroj was appointed executive chairman, while his son, Sorapol Wongwattanaroj, took over as CEO of the group. He is now changing the structure of the company.

In February, the group approved an investment of THB 220 million (€5.7 million/$6.5 million) to upgrade its chicken and seafood production lines.

“This investment was part of the changes, it was divested to different operations,” Ratana-Arporn said.

New will be the production of frozen sushi and frozen chicken. The new lines will be ready this year and run under the subsidiary Surapon Supreme Foods (SUP).

Ratana-Arporn declined to disclose the capacity of its plants, but the frozen sushi production will be mainly destined to the EU markets.

“That’s where there’s more interest for this product, but if we see opportunities somewhere else we’ll also look into other markets," he said.

In addition, the company is renovating the facilities of its Surapon Foods subsidiary, which is mainly dedicated to the production of ready-to-eat foods such as frozen dim sum and finger foods.

“We shifted our focus to chicken due to the EMS crisis in Thailand, we mostly rely on Thai raw material and this caused a lot of uncertainty, so we saw chicken was a safe bet,” he said.

“At the moment, we’re looking at Thai production and it’s still not enough, we don’t know when it’ll come back but of course if it returns to high levels we will look into shifting back to higher volumes of shrimp, that’s our main product for markets such as Japan.”

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Thursday, June 1, 3.45 pm ICT

Thai industry invited to head to Germany

The Anuga conference will be held in Cologne, Germany, and will host more than 160,000 visitors from 192 countries from the food industry between Oct. 7-11.

In a collaboration between Thaifex and Anuga, the organizations are inviting Thai regional and international businesses to attend the show.

In 2016, exports of Thai fish preparations and conserves to Germany fell 28.5 percent, to €40.9 million.

“Anuga is a good chance for Thai exhibitors to see the global markets, the opportunities, the trends and to meet thousands of buyers in their industries,” said Dietmar Eiden, vice president of the Trade Fair Management of Anuga.

Thai delegates will have the opportunity to show their ideas, and to introduce them to the international markets.

“After meeting with potential partners, Thai producers will have a good opportunity to adjust their product to international needs,” said Kalin Sarasin, chairman at the Thai Chamber of Commerce and Board of Trade of Thailand.

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Thursday, June 1, 3.30 pm ICT

'You’re no longer suitable'

That's what Thai producers heard from the European Union a few years ago, even before the forced labor scandal came about -- and exporters are still suffering the severe impact.

“Spain used to be a huge market for us four years ago, and it’s residual now, same as Italy,” Tanyisa Luengrungroj, overseas branch manager in Europe at CP Foods, told IntraFish.

After two days at the Thaifex show, the GSP topic resonates whenever one mentions Europe.

“It killed the market,” said Choopong Luesukprasert, managing director of Marine Gold Products.

Producers and traders are equally agreeing on the fact the high taxes clearly benefit direct competitors of Thailand, such as Vietnam.

Why was GSP implemented? They say they don’t know.

“The EU decided that the Thai product was no longer suitable for the market, Thailand lost its status in the GSP scheme, and the EU implemented those tariffs,” Jim Gulkin, managing director of Siam Canadian, told IntraFish.

“It was before the labor scandal, and although that doesn’t make the situation better, I don’t think that was the reason, it was very political, something to do with political preferences over countries with which EU members have a long relationship,” Gulkin said.

Asked if Brexit could at least open the doors for the UK market he said; “It could, but it’s to be seen, the UK is looking for free-trade agreements, but Vietnam has been looking for that with the EU for some time and that has gotten nowhere, so will the UK partner with Thailand, or Vietnam, or someone else?

"That is something we don’t know.”

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Thursday, June 1, 1.15 pm ICT

Lucky for some

"The US market is stable: People have got to eat, and we have got the product," Choopong Luesukprasert, managing director of Marine Gold Products, told IntraFish this afternoon.

"We see a very positive outlook there."

Of course, as one of the few companies exempt from the US antidumping tariffs his situation is very different to other exporters'.

“Our books have been inspected and have had the necessary results for three years in a row, with zero indicators of price dumping over the period, so we are exempt from the duty,” said Luesukprasert.

Marine Gold exports 55 percent of its production to the United States, with Japanese and Korean markets accounting for another 18 percent. These also look promising, according to Luesukprasert, as does the domestic market, which right now accounts for around 8 percent.

However, there is one market the shrimp producer feels less rosy about.

In fact, the company has all but given up on the UK after the EU decided to take Thailand out of the Generalized Scheme of Preferences (GSP), which in turn shot up import duties of Thai raw material, “and killed the UK market," said Luesukprasert. "It is dead for us.

“Maybe the UK can come with some agreeable terms after Brexit, but for the time being that market is not an option.”

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Thursday, June 1, 11.08 am ICT

How EMS repainted the global shrimp picture

There’s too many players in the industry at the moment, and that’s the biggest headache of Thai shrimp producers, Jim Gulkin, managing director at trading company Siam Canadian, told IntraFish.

Although the EMS crisis is over, the consequences of it won’t be temporary, he said.

First because of the many countries that jumped into the shrimp export scene when Thai production fell so drastically, and second, because Thai shrimp production “will probably never be the same.”

Gulkin said production this year is better than last, albeit with some early rains impacting harvests.

“It’s better, but it will never be the same as it was once.”

Siam Canadian itself took advantage of the EMS situation, boosting sales from its offices around the world, and sourcing from different countries, something that gave the company the chance to work on a wider net of suppliers.

According to Gulkin, around the Asian shrimp region, the situation is as follows:

  • Indian production is good, and prices are relatively low, but they will stabilize in the coming two to three weeks.
  • Vietnam, which has had ongoing production problems -- although not as severe as Thailand -- has low production at the moment. However, its efficiency in processing offsets the low production, as the country imports and exports large volumes from Indonesia and India. Prices are stable.
  • Thai production is better, and it will grow compared with last year, but the early rains could have some impact on this. 

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Wednesday, May 31, 6.23 pm ICT

Indonesia's fight against IUU fishing impacting surimi producers

Landed volumes of the tropical surimi fish itoyori in India, Thailand, Indonesia and Vietnam have dropped this year, on the back of Indonesia's fight against IUU fishing.

Between 30 to 40 percent of the fish caught by southern Vietnamese vessels for the surimi sector was caught in Indonesian waters, Pascal Guenneugues told IntraFish.

However, no one is daring to fish in those waters any longer, he said.

Susi Putjiastuti, Indonesia’s minister of fisheries, implemented a strict policy to sink illegal vessels and it seems to be working.

Of course, a big part of international trade will be affected, Guenneugues said.

According to him, the fall of catches from Vietnam will affect the supply of surimi into the Japanese market, a market set to will struggle to get the product from somewhere else.

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Wednesday, May 31, 5.18 pm ICT

IUU and slave labor: two sides of the same coin

Two ground-shaking issues have put Thailand at the center of controversy in recent times, and although they might seem different, they are simply two sides of the same coin.

The issue of forced labor is complex, and cannot be fixed with traditional thinking. It took Panisuan Jamnarnwej, director of the board of the Thai chamber of commerce, many years of experience to understand the different layers that build up to the surface, and these need to be disseminated in order to be tackled.

Jamnarnwej told IntraFish the concerns right now surround illegal unreported and unregulated (IUU) fishing, while a few years ago everyone was concerned with the status of Thailand in the US Trafficking In Persons (TIP) report.

“Labor onboard a vessel is hard to monitor, while fishing is hard work, it is risky and dangerous, and pay should be four times the minimum wage to pay for that risk. But there’s not enough fish in the sea to give this kind of money,” Jamnarnwej said.

“When you look at the work at sea, there are big, industrial fishing vessels with the resources for monitoring, with high costs and low margins that are only profitable due to the large volumes they catch.

And then you have the small vessels where it is not possible to make enough money to pay the crew what they deserve.

For a boat to make money for its crew, Jamnarnwej said, it needs to catch what three vessels catch, and have the costs of just one, or just have the skipper as its only crew.

“It is very simple, the small vessel owner has to be the only crew on the vessel -- often there's no catch, and you can’t guarantee that your fishermen will get paid, so you simply cannot have fishermen."

He said it is important to do something, but the problem will be difficult to solve. Aquaculture, in his opinion, is a safe bet in this matter.

"You need volume to get margins, and wild catch won’t give this to you, it’s only aquaculture that gives you volumes, and gives businesses stability and guarantees output."

To turn fishing into a volume-driven industry “the sea needs to give more, the fish needs to be more abundant, and we should get to a point where there aren't that many boats out there.”

In addition, with the lack of reporting in the Thai sector, the lack of data and information about landings, it is impossible to know what's in the water, what species are caught, and from which part of the sea.

The issue at the moment is hard to solve, but he said it is "good that they are doing something."

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Wednesday, May 31, 4.44 pm ICT

What’s happening in Europe with Asian fish is a ‘scandal’

Pascal Genneugues, chairman of surimi raw material company Future Seafood, told IntraFish it is a "scandal" that companies in Europe are holding back from buying Asian product for not being Marine Stewardship Council (MSC) certified.

“I think the situation is a scandal, sustainability is only measured by a program that is not applicable in big and divided fisheries,” Genneugues said.

He argues MSC certifiers and inspectors have it easy to audit fisheries where the vessels are well identified and concentrated, as well as fishery stocks, but they can’t do it in bigger fisheries “which actually support more families.”

Genneugues also said a quota system in certain fisheries in southeast Asian countries would not work, because fish stocks are widely dispersed.

"The system that many countries have in which fishing is banned in the spawning seasons is good to safeguard the reproduction and survival of species, but certification based on standards that cannot be measured in those countries is affecting those fisheries a lot," he said.

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Wednesday, May 31, 3.12 pm ICT

You think surimi is fish waste? Think again

Surimi has been struggling with its reputation -- something that can quickly develop into a nightmare for producers.

And bad press doesn't help. Not too long ago, Spanish press attacked surimi in a news story titled, 'Illegal fishing and slave labor behind surimi, the false crab that no one knows where it's coming from.'

Serge Thirion, sales and marketing director at Lucky Union, said reports attacking surimi are written with very little knowledge of what the product actually is.

He conceded the industry itself should be playing a role in changing this perception.

“We -- at Lucky Union -- are mainly processing Alaska pollock and southern hake, from two certified fisheries, a high protein, low-fat and very healthy product," Thirion told IntraFish. "But people have misconceptions."

“I actively invite over all of those who don’t know what surimi is to see what we do, we’re quite the opposite to a hot dog sausage. We use fresh product, not waste,” he said.

As a lone player, Lucky Union is trying to promote the product across its markets, but Thirion warned more should be done to finally eliminate the bad image.

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Wednesday, May 31, 3.01 pm ICT

Brighter outlook for Alaska pollock surimi pricing?

Alaska pollock volumes were expected to flood the market this year, and "we thought prices would fall even further down, but fortunately, this hasn't happened,” Pascal Genneugues, chairman of surimi producer Future Seafood, told IntraFish.

“The situation is bad, and prices are very low, but they didn’t fall that much after the increase in [fishing] quota,” he said.

For low grade surimi, prices did fall slightly, but high grade surimi prices are holding up.

However, Genneugues said he would “not be surprised” if Alaska pollock producers saw prices increase a little bit.

“This year, part of the season 'B' quota was transferred to season 'A,' and there will not be a carry-over of raw material from season 'A' to 'B,' as it has happened in the previous year, so the producers could see better prices after all,” he said. 

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Wednesday, May 31, 11.00 am ICT

CP Foods sees only positives on Brexit

CP Foods, whose main shrimp markets are the United States and the UK, foresees a rise in exports to the latter following Brexit.

"Once the UK is outside of the European Union equation, the GSP [Generalized Scheme of Preferences] to the country will be eliminated," Charas Kongkatong, general manager at the company's aquaculture arm, told IntraFish.

"At the moment, duties for raw material into the EU are 30 percent, and for value-added shrimp products are 20 percent. Once the UK is out this will disappear," he said.

Meanwhile, the company will continue to compete with South American producers in Europe.

"Imports into Spain and Italy, which used to be very high, started falling after Thailand lost its position in the GSP, and I don't think they will pick up at current rates," he said.

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Wednesday, May 31, 9.15 am ICT

Thai Union: IntraFish gets the tour

IntraFish was yesterday lucky enough to get a first-hand tour of Thai Union's Bangkok factory and sit down with Preerasak Boonmechote, the company's shrimp unit managing director.

The company is experiencing some challenges to its growth plans, but is also investing heavily in value-addition and new markets. Read our first story from the visit here.

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Wednesday, May 31, 9.00 am ICT

World of Seafood comes to Bangkok

Despite a fraught journey of flight cancellations and complications, IntraFish has arrived in Bangkok and is looking forward to getting out on the show floor at Thaifex and giving you the latest news and views from everyone here.

If you'd like to meet us at the show, please drop an email to lola.navarro@intrafish.com or visit our booth at #C3-Q63.

Here's to a great show!

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