Pollock prices

Chinese pollock processors are being offered price levels for double frozen block contracts from European processors that are loss-making, given the current level for headed and gutted (H&G) raw material, sources told Undercurrent News.

The low price levels for single frozen, pin-bone out (PBO) raw material from US and Russian catchers means the double frozen block price, based on H&G mainly from Russia, is likely to come down, sources said.

FOB offers from Chinese processors for double frozen [2x] blocks are around the $2,150-$2,350 per-metric-ton level, but EU processors are pushing for $2,100/t, sources in China said.

“No big contracts have been done. There are not enough orders for all Chinese double frozen pollock processors,” said a Qingdao-based executive, who said offers from China were as low as $2,150/t.

It’s not possible for processors to sell untreated double frozen blocks at this level with 25cm-size Russian H&G over $1,000/t, one Dalian-based processing executive, who declined to be quoted by name, told Undercurrent.

A source with a European processor, who also declined to be quoted by name, confirmed this picture. “I am surprised the H&G price is holding at this level {$1,000/t], as it needs to go down. You wonder how much they [the Russians] are actually selling at this level,” he told Undercurrent.“Actually, we are worried about these low prices. It might be that the customers start pushing for lower prices. This is not good for anyone. We are hearing, from the US and Russian side, that the PBO prices will go up in B season, so this low level should be a short-term thing,” he said.

During the Boston seafood show, the seller with a Russian pollock fishing firm told Undercurrent the prices for H&G are out of kilter with the offers on 2x blocks.

“The maths do not add up, that is the issue the whole industry has,” said the executive, who also did not wish to be quoted by name.

For double frozen FOB prices of between $2,150-$2,280/t, which is where this source said they are likely to settle, H&G prices of $900-$950/t are needed, he said.

Prices for PBO blocks for A season production are also currently unsettled.

The Russian sellers highlighted the issue for fishing companies of the difference between the prices for stocks of PBO blocks from last year, which are selling for as low as $2,300/t, and the level which this season’s catches are being offered at.

All things considered, this executive said a level of around $2,450-$2,500/t (ex-warehouse) would be a good result for A season. That would be down around $200/t on B season of 2016. 

“Last year, at Boston, I had a feeling we had hit the bottom on prices. But, this year, I have a new feeling,” he said.

Prices for A season should have settled before the Brussels seafood show, he said. The Brussels show takes place at the end of April, this year.

 

According to Undercurrentnews.com