Fishery Products Annual

An Expert's View about Aquaculture in China

Posted on: 22 Jan 2012

US aquatic exports to China increased 58 percent to $930 million in the first ten months of 2011 but still face an aquatic trade deficit exceeding $1.1 billion.

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Voluntary Public - Date: 12/31/2011 GAIN Report Number: CH11065 China - Peoples Republic of Post: Beijing Fishery Products Annual Report Categories: Fishery Products Approved By: Scott Sindelar Prepared By: M. Melinda Meador, WU Xinping and Angie Han Report Highlights: China's aquatic production in 2012 is forecast at 55.3 million metric ton (MMT), up more than one percent over from 2011. The aquaculture sector is expected to continue growing, albeit somewhat slower, in response to growing domestic consumption, a robust processing industry and strong export market. Total aquatic trade value is also expected to increase rapidly to an estimated $21.7 billion. US aquatic exports to China increased 58 percent to $930 million in the first ten months of 2011 but still face an aquatic trade deficit exceeding $1.1 billion. Prospects remain strong for frozen fish, including salmon and plaice. Reduced import duties for several fish products in 2012 may increase opportunities for US exports. Executive Summary: Production: China's aquatic production in 2012 is forecast at 55.3 MMT, up more than one percent from 2011. The aquaculture sector is expected to continue growing, albeit at a somewhat slower pace. Wild caught production, including overseas sourced, is not expected to rise in the future due to resource restrictions. Demand: -Domestic - Rising affluence is driving domestic dietary habits toward alternative protein sources, including aquatic products, and increasing domestic consumption. -International - Sales to major export markets are rising as world economies rebound. Total aquatic trade: -The value is expected to increase rapidly to an estimated $21.7 billion in 2011 from $17.2 billion last year and produce a $10.2 billion surplus. -China’s exports to the United States climbed to $2.1 billion in the first ten months of 2011. -Aquatic imports from the United States increased to $930 million in the first ten months of 2011, up 58 percent over the same period in the previous year. Challenges: -Investment in new aquaculture facilities slowing, environmental concerns and coastal development will limit resources available for seawater aquaculture expansion. -Limited resources restrain growth for wild catch increases. -Robust processing industry faces rising production costs and labor shortages. -Increase in international regulations. Export Opportunities: -Prospects remain strong for US salmon, frozen fish. -Reduction in import duties on several fish products in 2012 could boost imports for domestic consumption. General Information: Definition of terms in China: China’s definition of aquatic products includes both cultured (farm-raised) and wild caught products; aquatic products include fish, shrimp/prawn/crab, shellfish, algae, and other; aquatic catch production is total volume of both fresh and sea water caught wild aquatic products; Aquatic culture production is the total volume of both fresh and seawater cultured (farmed) aquatic products. This report will use Chinese terminology to maintain consistency between Chinese statistics and product categories. Total aquatic trade statistics in this report do not include fishmeal. Production China expected to remain top aquatic producer China remains the world’s largest aquatic product producer. China’s fishery sector is primarily aquaculture, both fresh and seawater cultures, and accounted for approximately 72 percent of total aquatic production in 2011. The wild-catch component is significantly smaller and declining wild fishery resources, both domestic and overseas, will contain future potential growth. Aquaculture is expected to continue growing, albeit at a somewhat slower pace than previous years. In 2011, new aquaculture area increased five percent over the previous year, a significant drop from a 14 percent increase in 2009, indicating investment in new facilities may have peaked. Table 1 China’s Aquaculture Area Resources (Unit: Hectares) Freshwater- Freshwater- Freshwater- Freshwater- Year Total Seawater Freshwater Pond Reservoir lake Other 2010 7,645,223 2,080,880 5,564,343 2,377,001 1,795,579 1,007,103 1,692,773 2009 7,283,138 1,859,313 5,423,825 2,331,900 1,726,407 998,232 1,707,000 2008 6,549,932 1,578,909 4,971,023 2,144,715 1,549,612 961,335 1,792,862 10/09 Change 5% 12% 3% 09/08 Change 14% 18% 13% Source: 2008, 2009 and 2010 China Agriculture Statistics Report 2010 total aquaculture area Total aquaculture water area reached 7.65 million hectares (MHa) in 2010 from 7.28 MHa in the previous year, with the majority (220,000 HA) of expansion in seawater facilities. In further developing its coastal water resources, Liaoning Province in northeast China remains the top producer with a 2010 net increase of 128,000 hectare (HA) (compared to a net increase of 266,000 HA in 2009), followed by Shandong and Yunnan with net increases in aquaculture area of 71,000 HA and 32,000 HA in 2010, respectively. MOA officials relate that further expansion of water resources, especially seawater for aquaculture, will face serious challenges from environmental concerns and the rapid industrialization/urbanization of China’s coastal region. Future production gains may have to incorporate technology and innovation to maintain additional growth. For 2010, Shandong, Guangdong, and Fujian provinces, due to favorable coastal locations and abundant freshwater resources/facilities, are expected to remain the largest aquatic producers. Hubei, Guangdong, and Jiangsu provinces are the largest in terms of freshwater cultured production. Aquatic Production expected to increase in 2012 Aquatic production for the first half of 2011 reached 22.8 MMT with a cultured production of 17 MMT, up 2.8 percent over the same period in 2010, and accounting for 75 percent of total production, based on China’s Ministry of Agriculture (MOA). 2012 total aquatic production is forecast at 55.3 MMT, compared to an estimated 54.6 MMT in 2011 and 53.7 MMT in 2010. Total wild catch production in 2011 is expected to maintain last year’s level. Table 2 China’s aquatic production (Unit: 1000 Metric Ton) Category/Year 2006 2007 2008 2009 2010 2011* Total Aquatic Production 45,836 47,475 48,956 51,164 53,729 54,570 -Seawater Aquatic Production 25,096 25,509 25,983 26,816 27,975 28,320 ---Seawater Catch 12,455 12,435 12,580 12,763 13,152 13,200 ---Seawater Culture 12,642 13,073 13,403 14,052 14,823 15,120 -Freshwater Aquatic Production 20,740 21,966 22,973 24,348 25,754 26,250 ---Freshwater Catch 2,204 2,256 2,248 2,184 2,289 2,250 ---Freshwater Culture 18,536 19,710 20,725 22,165 23,465 24,000 Source: 2011 China Statistics Yearbook/Table 13-20;* Estimated by FAS/Beijing Table 3 China's seawater and freshwater aquatic production by category (Unit: 1,000 Metric Ton) Category/Year 2009 2010 2011* Cultured products 36,216 38,248 39,120 Fish Production 20,340 21,450 Shrimp, Prawn, and Crab 2,977 3,199 Shellfish 10,766 11,333 Algae 1,464 1,511 Other 669 755 Catch products 13,971 14,328 15,450 Fish 9,567 9,870 Shrimp, Prawn, and Crab 2,347 2,389 Shellfish 954 909 Mullusks 643 658 Algae 28 25 Other 432 477 Catch production from other seas 977 1,116 1,050 Source: 2010 China Agriculture Statistics Report/Page - 86;* Estimated by FAS/Beijing Total fish production stood at 31.3 MMT in 2010 (up 1.4 MMT from the previous year), accounting for 58 percent of the total aquatic production, followed by shellfish and crustaceans at 23 and 10 percent, respectively. Cultured fish continues to dominate with total production of 21.4 MMT, accounting for 68 percent of total fish production in 2010. Carp remains the most popular cultured freshwater fish with total production of 15.1 MMT in 2010 (from 14.5 MMT in 2008), accounting for 73 percent of total freshwater cultured fish production. Tilapia, another popular cultured product, saw 2010 production of 1,332,000 MT, up six percent from 2009, but a drop from the previous ten year average of 11 percent. Lower prices in 2009 and abnormal weather conditions in 2010 had driven down production. The 2011 tilapia production is expected to resume strong growth in response to foreign market demand and increasing domestic consumption, but the overall rebound will be impacted by increasingly serious disease outbreaks (streptococcicosis) and other factors (see following paragraph – Challenges).Guangdong, Guangxi, Fujian and Hainan continue to be the top four tilapia producers. Yunan province has been developing water resources for tilapia farming with total production approaching 60,000 MT in 2010. Total catfish production was 591,000 MT in 2010, up from the 558,000 MT in 2009 and is expected to rise in 2011 in response to dynamic domestic consumption. Catfish production for export remains soft in response to uncertainty regarding pending U.S. import policies. Shellfish, primarily cultured in seawater, continued to show moderate growth with 2010 production of 11.3 MMT (See tables 2 and 3), and accounted for 76 percent of total sea water cultured production. Cultured crustacean production reached 3.2 MMT in 2010, up 7.5 percent over the previous year and is expected to remain strong in 2011 in response to domestic demand; catch production remains almost unchanged in 2010. Cultured penaeus vannamei (also known as white shrimp) production exceeded 1.2 MMT (up from the 1.1 MT in 2009), accounting for 38 percent of total cultured crustacean production. Table 4 China's top-8 aquatic producing provinces in 2010 (Unit: 1,000 Metric Ton) Province Total production Sea production Freshwater production Total 53,730 27,975 25,755 Shandong 7,838 6,464 1,374 Guangdong 7,290 4,016 3,274 Fujian 5,870 5,127 742 Jiangsu 4,604 1,364 3,240 Zhejiang 4,779 3,813 966 Liaoning 4,304 3,497 807 Hubei 3,351 0 3,351 Guangxi 2,755 1,544 1,211 Other 12,939 2,150 10,790 Source: 2011 China Statistics Yearbook Table13-20 Although there are freshwater aquaculture facilities nationwide, particularly for carp, some species’ production is limited to certain regions due to available resources and climatic conditions. For example, 90 percent of tilapia production occurs in four provinces, Guangdong, Guangxi, Hainan, and Fujian in 2010. 57 percent of catfish production is located in Sichuan, Jiangxi, Hubei, Guangdong and Hunan provinces. The largest producers for both cultured freshwater and seawater shrimp and prawn are Guangdong, Jiangsu, Hubei, Guangxi, Zhejiang and Guangxi provinces. In 2010, Guangdong was the largest shrimp producer with total cultured production of 554,000 MT (compared to the 537,000 MT in 2009), of which Penaeus uannamei production reached 449,900 MT in 2010. Eel production is concentrated in Fujian, Guangdong, and Jiangxi provinces with much of the production destined for the Japanese market. Shandong, Fujian, Guangdong, and Liaoning provinces dominate the cultured shellfish production accounting for 80 percent of the 2010 total. Production Challenges --Tilapia faces disease, competition According to industry sources, streptococcus disease continued to adversely impact tilapia production in 2011. Experts believe deteriorating water environments and high-density farming has led to high bacteria counts. Low quality inputs, including feed and fingerling stock, and overuse of antibiotics are also contributing to disease conditions. These problems will impact tilapia production and quality in the near future. Another challenge for the tilapia industry is the increased production and exports of Basa fish by Vietnam. Industry experts state that Vietnam’s Basa 40 percent meat rate (compared to 33 percent for tilapia) and lower price took significant market share from China’s tilapia sales in the United States in 2011. Industry leaders are studying ways to raise China’s tilapia competiveness in the international market. A new international aquaculture certification system initiated by the World Wildlife Fund (WWF) is also likely to impact China’s tilapia production and exports. --Aquatic catch production is shrinking Total 2011 catch production of 15.5 MMT is almost unchanged from 2010 and catch production is unlikely to increase in the foreseeable future due to limited availability of resources. Seawater catch production from other territorial seas was 1,116,000 MT in 2010, up from 977,000 MT last year. Industry insiders believe it will be difficult to increase production significantly from other territorial seas. Future fishery development plans In October 2011, the MOA published its 12th Five Year (2011-2015) Development Plan for Fishery. Significant targets under the plan include: -meeting the rapid growing demand for quality aquatic products by domestic consumers ; - emphasizing the balance between aquaculture development and ecological protection; - re-constructing and standardizing 1,333,000 Ha of aquaculture ponds to raise productivity; - meeting the safety/quality targets for 98 percent of aquatic products; - maintaining stable to growing marine fishery output in other territorial seas with target production of 1.3 MMT per year, up from 2010 output of 1.1 MMT; - licensing of 100 percent of aquaculture production facilities by 2015. - reaching production of 60 MMT by 2015, with 75 percent from aquaculture (as compared to estimated 72 percent in 2011). MOA has established agricultural product quality test stations in 1,200 counties (out of the total more than 2,400 counties) nationwide to supervise quality. To ensure the quality of aquatic products for export, MOA and the Administration for Quality Supervision, Inspection and Quarantine of China (AQSIQ) adopted a strict licensing regime for all export-oriented farms and processing establishments. MOA and AQSIQ conduct frequent field audits of export-oriented aquaculture farms. Aquatic products for export are subject to mandatory inspection and must be accompanied by AQSIQ inspection certificates. Aquatic Processing Production --Stable growth in 2011 of aquatic processing for re-export The aquatic processing for re-export sector maintained stable growth in 2011. According to MOA, in the first three quarters of 2011, aquatics processed (with imported material) for export reached 900,000 MT in volume and $3.85 billion in value, up 13 and 22 percent, respectively. This export value accounts for 31 percent (down two percent over the previous year) of the total aquatic exports. Increased exports for processing reflects a steady rebound in demand for aquatic products by major importing countries and an increase in prices for raw and processed aquatic products in the world market. The share of export value under the processing trade accounted for 31 percent of all aquatic product export value, two percent lower than same period of 2010, in part showing an increased export of cultured aquatic products in 2011. Based on the Global Trade Atlas (GTA), China’s imports of frozen fish in the first ten months of 2011 approached 1.76 MMT, up 13 percent over the same period in 2010. The imports of mollusks also exceeded 260,000 MT, up 15 percent over the previous year. Most of these imports have historically been destined for the processing trade. The aquatic processing trade sector is increasingly challenged by rising production costs and a shortage of labor, and the situation is expected to become more serious in the future. --Stable growth in 2011 of aquatic processing for domestic consumption Most Chinese consumers’ still prefer live or fresh aquatic goods instead of processed products. Therefore, domestic consumption of processed aquatic products remains relatively small compared to overall domestic aquatic product consumption. Processed aquatic products using domestic raw material (mostly cultured products) is highly export focused. According to MOA, the total number of aquatic processing facilities reached 9,762, up from 9,635 in 2009. Total processing capacity also increased to 23.9 MMT from 22.1 MMT in 2009. In 2010, 17.8 MMT of aquatic products were processed, slightly down from the 18.2 MMT in 2009. Total processed aquatic product volume stood at 16.3 MMT, of which 10 MMT was frozen and frozen processed goods. This trend is expected to continue in 2011 as more frozen and frozen processed goods are shipped to heartland provinces. Aquatic processing bases are located in or near major aquatic production regions. Of the total 9,635 processing facilities, 6,470, or 67 percent are concentrated in Zhejiang, Shandong, Fujian, and Guangdong provinces. Shandong ranks number one for processing capacity at 7.1 MMT per year followed by Guangdong at 4.2 MMT. These provinces are also major aquaculture producers and are equipped with port and cold storage facilities. Many foreign enterprises have also entered the processing trade in these provinces. Consumption Due to China’s natural resources in freshwater lakes and rivers, Chinese consumers have historically consumed a large proportion of freshwater aquatic products. As China’s distribution systems become more developed and consumers rising affluence increases their interest in a more diversified and nutritious diet, seafood consumption is on the increase. Post estimates per capita consumption for urban dwellers in 2010 was 14.85 Kg, up from the estimated 14.7 Kg in 2009, while NSB reported that rural residents consumed 5.15 Kg, down slightly from 5.27 Kg in the previous year. (NSB did not provide consumption of aquatic products for urban dwellers in 2008 and 2010). Per capita consumption is expected to increase steadily, with strong growth potential in the rural sector where affluence and access to new products are beginning to make inroads in dietary habits. Table 5 Per capita consumption trends of aquatic and animal products (Kg) Per Capita Consumption Trends for Aquatic Products 2005 2006 2007 2008 2009 2010 Urban 12.55 12.95 14.2 14.3* 14.7* 14.85* Rural 4.94 5.01 5.36 5.25 5.27 5.15 Per Capita Consumption Trends for Pork, Beef, Poultry and Mutton Urban 32.83 32.12 31.8 30.7 34.67 34.72 Rural 20.76 20.54 18.74 18.3 19.58 20.0 Note: Urban Population of 669.78 million (49.95%). Rural Population of 671.13 million (50.05%). *estimated by Post (data not available from NSB); Data before 2007 are based on NSB unadjusted version Source: 2011 China Statistical Yearbook Table 10-9 and 10-29 Based on MOA survey results (among 80 major aquatic product wholesale markets), the average wholesale price for aquatic products increased by five percent in the first three quarters of 2011 over the previous year. The price increased by 5.4 percent for sea water products, and 4.8 percent for fresh water products. Prices for aquatic products are expected to grow in 2012 reflecting increases in the price of feed and other inputs. Table 6 lists the ten provinces and municipalities with highest expenditures on aquatic products in 2010. The per capita consumption of aquatic products is highest in coastal regions (where aquatic products have been a traditional source of protein) and locations with relatively high disposable income. The rankings are almost unchanged from 2009. Most Chinese consumers are price sensitive when purchasing aquatic products. Freshwater cultured products such as carp and shrimp or prawns are popular for home consumption and in restaurants due to their affordability. Seawater aquatic products, including yellow croaker, ribbonfish and squid continue to be favorites in Northern China. Imported seawater products popular domestically include cod, squid, plaice, and mackerel. Processed shellfish/shrimp/prawns and tilapia fillets are increasingly popular among city consumers with busy lifestyles. High-value imported seafood such as lobster, geoducks, salmon, and crab are widely used by hotels and restaurants for high-end consumers. Based on the GTA, China’s total imports of salmon reached 191,000 MT in the first ten months of 2011, up 43 percent over the previous year. Imports from the United States and Russia reached 83,000 MT and 78,000 MT, respectively. Table 6 Per Capita Annual Living Expenditure on Aquatic Product of Urban Residents by Region in 2010 Aquatic Product Expenditure Disposable Income Disposable Income Value Region RMB Value Rank (RMB) Fujian 1,000 7 21,781 Shanghai 818 1 31,838 Zhejiang 714 3 27,359 Guangdong 658 5 23,898 Hainan 670 21 15,581 Tianjin 444 4 24,292 Jiangsu 422 6 22,944 Liaoning 364 9 17,713 Shandong 322 8 19,946 Guangxi 293 12 17,064 Hubei 267 18 16,566 Nationwide Average 327 NA 19,109 Source: 2011 China Statistics Yearbook/Table 10-15 Trade Overall Aquatic trade value likely hit record $21.7 billion in 2011 Total aquatic trade value in 2011 is estimated at $21.7 billion, up 26 percent over the $17.2 billion in 2010. The aquatic trade surplus is expected to hit $10 billion in 2011, up from $8.3 billion from last year. China’s aquatic export trade destinations with export values over $100 million rose from 17 countries/regions in 2009 to 23 in 2011. Japan continues to be the largest export destination, followed by the United States and South Korea. According to GTA, in the first ten months of 2011, import volume stood at 2.2 MMT, up 12 percent, respectively, over the same period in previous year while total export volume exceeded 2.9 MMT, up 23 percent. Exports Export value is estimated to surge to $15.9 billion, up 25 percent over the previous year. This significant growth is a combination of increased export volume and increased unit price. Most Chinese industry insiders believe that a stable recovery of world economies, and the competitiveness of the Chinese industry, will result in higher aquatic exports in 2012. --Fish fillet tops total aquatic exports Fish fillet (HS Code 0304) continues to be the largest export category with export value at $ 3.5 billion, accounting for 28 percent of total aquatic exports in the first ten months of 2011. Based on GTA, in the first ten months of 2011, China’s aquatic exports increased in both volume (up 23 percent) and value (up by 27 percent) over the previous year. All major export categories, fish fillet (HS Code 0304), the prepared crustaceans and mollusks (HS Code 1605), and the mollusk and other (0307) have seen rapid growth in value and volume. Fish fillet (HS Code 0304) exports increased by 10 percent in export volume, and 22 percent in value, compared to the previous year. Export of prepared or packaged fish and caviar (HS Code 1604) increased by 15 percent in volume and 28 percent by value over the previous year. Strong exports of aquatic products reflect the steady recovery of demand by customers in major import markets. --Tilapia exports continued growing Based on GTA, in the first ten months of 2011, total tilapia exports reached $845 million, up 16 percent from the $731 million in the previous year, although the export volume increased by only four percent. Processed tilapia products (fillet, dried/salted, prepared/preserved) continue to dominate, accounting for 66 percent in volume and 80 percent by value of all tilapia exports. The export price for processed tilapia products averaged $3,974/MT, compared to $3,591/MT in the previous year, also much higher than the averaged $1,873/MT for exports of fresh/chilled/frozen tilapia (exports of this category increased 51 percent in volume mainly to the U.S. and Africa). Exports of processed tilapia products are expected to continue growing in 2012 mainly due to its price competitiveness. In the first ten months of 2011, the United States remained the largest destination for China’s tilapia products, accounting for 43 percent of volume, however, the net export volume declined to 110,000 MMT from the 124,000 MT in the previous year in part due to more competitive Basa products from Vietnam. Imports Import value is estimated at $5.8 billion in 2011, up 31 percent from the $4.4 billion in the previous year, mainly due to recovering demands for aquatic products both globally and domestically. Russia is expected to remain China’s largest supplier of aquatic products in 2011, followed distantly by the United States and Japan. Total imports from Russia are estimated to exceed $1.5 billion in 2011, up almost 20 percent from the previous year, accounting for 26 percent of China’s total 2011 aquatic imports. Based on GTA, salmon imports increased sharply to 192,000 MT in the first ten months of 2011, up 43 percent compared to the previous year. The United States and Russia are the largest suppliers of salmon to China. Imports from the United States in 2011 grew to 83,000 MT, up 40 percent over the previous year, while imports from Russia skyrocketed to 77,600 MT from the 23,600 MT in 2010. Russia’s surge is mainly due to internal policy changes which facilitated production and exports. Import prices for salmon in the first ten months of 2011 averaged $ 3,272/MT, similar to the $3,213/MT in the previous year. Qingdao and Dalian continue to be the two largest arrival ports for aquatic products, accounting for 79 percent of the total import volume in first ten months of 2011. Well-established facilities, including processing factories in Qingdao and Dalian, solidify the two cities’ status as the largest seafood import hubs in China. Fishmeal imports are forecast at 1.2 MMT in 2012 Fishmeal is a highly regarded animal protein source used in animal and aquaculture feed. China’s domestic fishmeal production continues to be low and is expected to be less than 250,000 MT in 2011. The growing demand from the feed industry leaves an ever widening supply gap which must be filled by imports. Peru remains the largest fishmeal supplier at 677,000 MT, accounting for 64 percent of China’s total imports in the first ten months of 2011. While in the same period, imports from the United States hit a record 121,000 MT from the 51,000 MT in the previous year, most likely due to more diversified products at relatively lower price. Fishmeal imports in 2012 are forecast at 1.2 MMT, up from the estimated 1.15 MMT imports in 2011. Fishmeal imports fell to slightly more than one MMT in 2010 from the 1.3 MMT in 2010, mainly due to high fishmeal prices exceeding $1,600/MT. Imports in the first ten months of 2011 exceeded one MMT in response to a declining price which averaged $1,474/MT. US aquatic trade imbalance with China Although the United States remains the second largest importer and exporter of aquatic products to China, there is still a large trade deficit. In the first ten months of 2011, China’s aquatic imports from the United States increased to $930 million, up 58 percent over the previous year, while China’s exports to the United States climbed to $2.1 billion, resulting in a aquatic trade deficit exceeding $1.1 billion. During this period, frozen fish remained the largest category (valued at $752 million), accounting for 81 percent of the total imports from the United States. More specifically, salmon ranked first, valued at $261 million, followed by plaice at $186 million (out of the total $192 million for all flatfish). Salmon is increasingly popular among middle class consumers for home consumption and at restaurants or high-end hotels in large cities. Industry insiders believe China will grow to one of the world’s largest salmon markets in the near future. Total aquatic exports to the United States in the first ten months of 2011 rebounded to $2.1 billion, up 14 percent over the previous year. Major product category includes fish fillet ($962 million, up 10 percent over the previous year), followed by prepared/preserved crustacean/mollusks ($477 million), and prepared/packaged fish and caviar ($304 million). Policy China’s policy favors smooth growth for aquatic production and exports China’s fishery production policy remains generally unchanged. In the 12th Five Year Fishery Development Plan, the MOA plans to continue to promote a more sustainable development model with rational resource utilization, environmental protection, production of safe products, and increases to farmer income. Other measures included technology extension and greater supervision of drug use. As further expansion of water area is limited in some regions, the pond water depth for aquaculture has been raised to 2.5 meters in an effort to boost production. Domestic aquatic catch will continue to be restricted by the “Zero Growth” policy for domestic wild aquatic catch although the government is targeting increases in overseas catch. The two to three month summer fishing moratorium in China’s seawater continued in 2011, and the three-month spring fishing ban in the Yangtze River entered its eighth year. Additionally, MOA enforced a two-month fishing ban in the Pearl River region in 2011. In an effort to protect and restore ecological balance, the state and provincial fishery departments conduct frequent releases of aquatic fingerlings in national waters. Implementation of aquaculture licensing system delayed Per MOA, implementation of a nationwide aquaculture licensing system, targeted at better regulation of the industry and enforcement of policies, will continue to be enforced during the 12th Five Year Fishery Development Plan period. Licensing thousands of small-scale aquaculture facilities, however, has proven to be a challenge for the government. The policy on aquatic processing trade remains unchanged China’s government views the processing trade as an advantageous industry due to its role in generating new employment and producing rendered product that can be used as a feed ingredient for the feed industry. Basically, imports under “Processing Trade” will still be free of tariff and value added tax (VAT)so long as they are subsequently exported as processed products. Imports destined for China’s domestic consumption are subject to tariff and VAT (CH5089). Based on MOA, the share of the processing trade declined slightly, accounting for about 31 percent of aquatic export value in 2011 (compared to the 33 percent in 2010). However, China’s industry and official sources both claim that China is actively becoming the world’s processing center for mackerel, salmon, cod, and herring. Industry sources note that the number of enterprises involved in “Processing Trade” is on the rise, especially in Shandong and Liaoning. The import duty for several fish products reduced in 2012 China maintains relatively high import duties on seafood imported for domestic consumption and further subjects them to a 13 percent value added tax. Effective January 1 2012, however, the import duty on four categories of seafood, Frozen Greenland halibut, plaice, herrings and cod, will be reduced (see table) which should facilitate their import and sale in the domestic market. In the first eleven months of 2011, China’s total imports of frozen and chilled flatfish from the United States reached 123,000 MT (mainly frozen plaice with volume at 119,900 MT) valued at $210 million, while imports of frozen cod exceeded 40,000 MT valued at $117 million, and frozen herrings stood at 11,800 MT valued at $7.6 million. While current imports of these fish might be destined for re- export, the domestic consumption of these fish is also likely to increase. U.S. traders should consult with Chinese importers for implementation details regarding these import duties. Table 7 Import Duty for Four Seafood Reduced on January 1, 2012 H.S.Code Name MFN Duty (%) Tentative Reduced Duty for 2012(%) 1 03033110 Frozen Greenland Halibut 10 5 2 03033200 Frozen Plaice 12 2 3 03035100 Frozen Herrings 10 2 4 03036300* Frozen Cod 10 2 Note: This Code is not listed in the “2011-Import and Export tariff of China”, need to be clarified with the “2012- Import and Export tariff of China” available in later January. Import certificate for live edible aquatic products amended On December 11, 2008, AQSIQ published on its website the “Explanations on Amendments to Rules of Inspection and Quarantine on Entering Edible Aquatic Species.” (http://dzwjyjgs.aqsiq.gov.cn/zxjyjyyq/200812/t20081211_100208.html). The amendments require the exporting country to add detailed inspection and quarantine information to the export health certificate (See GAIN CH9050). FAS/Beijing, in collaboration with the National Ocean and Atmosphere Administration (NOAA) Seafood Inspection Program, APHIS/Beijing, and Foreign Commercial Service/Beijing held several consultations with AQSIQ on a new certificate. A NOAA amended version of Health Certificate for live edible aquatic products was approved by AQSIQ and transition to the new certificate in 2011 has been smooth. Implementation of new hygiene certificate for US imported fishmeal -pending On August 23, 2010 China’s AQSIQ informed the U.S. Embassy Beijing that its Decree 118, which was notified to the WTO as G/SPS/N/CHN/109 on May 15, 2008 and its Regulating Inspection and Quarantine of Import and Export Feed and Feed Additives of July 20, 2009 would both be going into effect at the beginning of 2011. This latter measure was not notified to the WTO. With these measures, U.S. exports of aquatic origin protein would face import requirements that included facility registration and new hygiene and quarantine requirements. China’s new requirements for fishmeal and other aquatic-origin protein and fish oil could have a significant negative impact on U.S. exports of fishmeal and fish oil from the United States. U.S.-origin fishmeal and fish oil commodities are currently being exported to China in accordance with the U.S.- China Protocol on the Veterinary Health Requirements for Non-Ruminant Derived Animal Feed and Tallow to be Imported from the United States to the People’s Republic of China, signed on November 18, 2004, the provisions of which require facility inspections by the U.S. Government; assignment of approval numbers by AQSIQ; product registration through China’s Ministry of Agriculture (MOA); and export certification by the USDA Animal and Plant Health Inspection Service (APHIS) Veterinary Services. In late July 2011, a NOAA delegation, in collaboration with FAS/Beijing reached agreement with AQSIQ to extend the importation of U.S.-origin fishmeal and fish oil under existing protocols and requirements until the end of June 2012. Meanwhile, AQSIQ will visit U.S. fishmeal processing facilities in late spring 2012 to study the fishmeal and oil regulatory and quality control system. Both sides are expected to reach a consensus on this issue before the end of June 2012. Traders should consult with importing partners for specific requirements for exporting fishmeal and fish oil to China pending final resolution of this issue. Marketing (ATO/Beijing) Demand for imported seafood and aquatic products is expected to continue its growth because of consumer affluence and increasing preference for high-quality and healthy foods. Much of the U.S. seafood and aquatic products exported to China are further processed for re-export purpose. Non-processed products are mostly high-value products which are introduced mainly through HRI foodservice sector in upscale hotels and restaurants. In general, Chinese consumers prefer to purchase live and fresh aquatic products, including fish, crabs, clams and others. This is particularly true for consumers in coastal provinces in East and South China, whether they purchase aquatic products in retail, wet market or in restaurants. With years of market development, more and more imported frozen aquatic products are appearing on Chinese consumers tables. Salmon, snow crab legs and cod are all products commonly available in supermarkets. Product identification, such as brand names, logo and country of origin are important tools to attract consumer interest among competing products in supermarkets. Thus, continued education of retailers and distributors is important to help consumers establish brand recognition and brand loyalty. Scallops, salmon, Alaskan snow crab legs, king crabs, black cod, and oysters are also popular items in many upscale hotels. Buffet style restaurants are common in these hotels and it is a good way to promote high-end seafood products to customers. With the proper display, customers are attracted to these high-value imported items. Chef demonstrations or themed promotions during major Chinese holidays such as Spring Festival and Mid-Autumn Festival are effective in the HRI food service sector for sales promotions. Fish roe is another popular product, with Japanese style restaurants the most common channel for this type of product. Importers claim high value U.S. seafood products are easy to sell in both first and second tier cities, even in coastal cities such as Qingdao. Products such as king crab kegs, scallops and oysters enjoy crisp sales. Major obstacles are inconsistent availability for fish and crab products due to insufficient supply from the U.S. There are also counterfeit products for snow crab legs, as claimed by restaurant operators in Zhengzhou, Henan province. Trade shows in China are a good venue for new products entry. At the recent China Fisheries & Seafood Expo in Dalian, live seafood, such as geoduck, was reintroduced by multiple US exporters. Importers are keen for this product as it is a popular item in Chinese cuisine, particularly Cantonese style. In previous shows, Canada has dominated this niche market. Trade shows are also a great way to obtain face-to-face meetings with new and existing buyers. Trade Tables Trade of Certain Aquatic Products (Volume: MT; Value: $ Million) Imports by Category Jan-Dec 2008 Jan-Dec 2009 Jan -Dec 2010 Jan-Oct 2011 Valu Valu Valu Valu HS Volume e Volume e Volume e Volume e Cod Tota 2,353,98 2,223,84 2,496,61 2,202,92 e l 6 3,713 4 3,638 4 4,438 4 4,628 0302 Fish, Fresh 7,057 44 9,789 61 15,722 106 9,997 82 Fish, 1,805,04 1,782,94 2,005,74 1,758,57 0303 Frozen 4 2,736 8 2,711 5 3,139 2 3,079 0304 Fish, Fillet 16,987 48 30,374 66 24,808 59 18,077 49 Fish, Dried, Salted, 0305 Brined 27,036 49 7,810 19 5,251 15 2,740 12 0306 Crustaceans 81,721 308 88,428 337 115,066 513 97,148 662 Mollusks & 0307 Other 398,003 471 274,980 394 283,525 512 260,752 589 Prepared and Packaged Fish and 1604 Caviar 6,038 24 3,226 16 4,037 19 4,552 19 Prepared and Packaged Crustaceans and 1605 Mollusks 27,036 29 26,291 36 42,460 75 51,086 136 Exports by Category Jan-Dec/2008 Jan-Dec 2009 Jan - Dec 2010 Jan-Oct 2011 Valu Valu HS Volume e Volume e Volume Value Volume Value Cod 2,730,03 2,735,66 3,134,16 12,76 2,969,75 12,39 e Total 0 9,619 8 9,849 2 4 0 2 0302 Fish, Fresh 39,680 118 38,043 142 39,691 179 28,377 121 Fish, 0303 Frozen 415,078 674 507,836 849 632,981 1,422 784,056 1,695 1,007,05 0304 Fish, Fillet 797,703 2,602 908,085 3,108 7 3,692 883,838 3,513 Fish, Dried, Salted, 0305 Brined 58,897 280 56,239 285 67,692 352 60,246 316 Crustacean 0306 s 86,979 380 189,468 1,042 199,740 1,157 168,400 1,012 Mollusks 0307 and Other 249,134 648 303,555 1,000 389,829 1,555 332,995 1,065 Prepared or Packaged Fish and 1604 Caviar 629,709 2,320 440,852 1,643 458,300 2,045 407,217 2,036 Prepared or Packaged Crustacean s and 1605 Molluscs 452,849 2,598 291,589 1,781 338,872 2,362 304,621 2,634 Source: Global Trade Atlas Aquatic Products Trade by Country of Origin (Value: $ million) Imports by Country of Origin Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 Russia 1,223 1,186 1,262 1,348 United States 533 549 726 930 Norway 183 274 401 276 Japan 181 203 303 107 Canada 184 162 217 262 India 94 124 156 103 Korea South 159 117 153 175 Thailand 115 99 136 115 Netherlands 175 92 117 51 New Zealand 73 75 97 138 Peru 100 65 77 144 Other 693 692 795 981 World 3,713 3,638 4,438 4,629 Exports by Country of Destination Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 Japan 2,500 2,470 2,979 2,897 United States 1,996 2,004 2,525 2,159 Korea South 917 869 1,174 1,127 Taiwan 173 346 590 589 Hong Kong 326 404 586 840 Germany 497 490 508 459 Russia 362 283 375 405 Spain 230 259 364 332 Malaysia 298 253 354 394 Canada 239 273 338 281 United Kingdom 257 230 266 258 Mexico 180 168 255 223 Indonesia 31 87 186 256 Australia 103 114 166 175 France 118 124 144 171 Philippines 55 150 137 136 Brazil 28 26 136 186 Netherlands 152 140 133 150 Thailand 118 93 129 218 Belgium 123 98 124 107 Italy 76 76 117 109 Portugal 55 76 107 88 Poland 64 76 103 112 Other 722 739 969 1,261 Total 9,619 9,849 12,764 12,932 Source: Global Trade Atlas Imports of Fish, Frozen by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 Russia 716,816 702,909 850,452 827,560 United States 211,631 237,743 269,473 322,480 Norway 79,283 136,054 170,059 108,870 Japan 95,651 104,783 124,853 46,210 India 88,399 88,316 106,395 60,747 Netherlands 121,138 67,379 74,399 32,365 Korea South 49,489 37,326 54,704 33,999 New Zealand 49,087 54,015 52,473 40,767 Thailand 106,737 59,103 50,109 43,516 Canada 37,068 34,602 29,820 26,694 Indonesia 28,080 27,332 21,494 23,730 Other 221,665 233,386 201,514 191,634 World 1,805,044 1,782,948 2,005,745 1,758,572 Price $/MT 1,516 1,520 1,565 1,751 Imports of Flatfish by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 United States 104,640 92,447 108,860 112,303 Russia 20,641 14,505 18,535 13,439 Canada 8,428 8,697 8,486 5,546 Greenland 6,441 6,243 7,116 6,180 India 1,990 3,994 3,820 2,220 Spain 2,117 2,731 3,066 2,077 Korea South 2,537 1,572 2,928 906 Iceland 1,662 2,462 2,271 3,019 Germany 1,671 2,335 2,231 1,890 Norway 2,372 2,389 2,018 2,414 Pakistan 2,597 2,208 1,775 947 Other 11,653 6,411 7,211 7,317 World 166,749 145,994 168,317 158,258 Price $/MT 1,488 1,488 1,613 1,988 Source: Global Trade Atlas Imports of Plaice by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 United States 103,536 90,695 107,846 109,714 Russia 16,498 9,862 13,469 8,839 Canada 2,915 2,881 4,503 2,157 Korea South 2,041 1,026 2,499 657 Spain 1,617 1,112 640 682 Portugal 537 266 459 366 Germany 168 534 458 552 Other 5,985 3,447 2,547 3,754 World 133,297 109,823 132,421 126,721 Price $/MT 1,478 1,367 Imports of Salmon by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 United States 44,700 58,693 65,311 82,626 Japan 39,101 44,236 56,075 8,923 Russia 25,537 86,567 38,105 77,624 Norway 6,535 8,733 14,783 5,226 Chile 5,413 13,815 5,863 6,393 Other 3,364 5,135 4,629 11,008 World 124,650 217,179 184,766 191,800 Price $/MT 2,395 2,345 3,301 3,272 Source: Global Trade Atlas Imports of Herrings by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 Russia 48,708 40,270 84,490 103,942 United States 4,757 5,699 8,221 11,800 Netherlands 4,239 7,841 5,503 4,803 Germany 1,752 1,603 2,024 997 Other 4,438 7,128 5,835 3,931 World 63,894 62,541 106,073 125,473 Price $/MT 563 528 560 526 Imports of Crustaceans by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 Canada 25,800 23,221 33,486 28,120 Thailand 4,029 5,894 14,366 6,908 Greenland 7,240 8,282 9,904 4,676 Myanmar 4,950 7,789 9,176 7,042 United States 5,913 5,043 5,446 6,677 Malaysia 2,280 2,212 4,259 2,528 Denmark 2,323 2,735 3,783 1,754 Bangladesh 1,405 1,954 3,656 4,488 Indonesia 2,751 2,266 3,586 4,072 Russia 7,976 6,460 3,564 2,799 Vietnam 1,258 1,697 3,404 2,464 India 1,639 2,316 2,871 2,884 United Kingdom 2,038 1,820 2,435 1,529 Other 12,120 16,739 15,130 21,207 World 81,722 88,428 115,066 97,148 Price $/MT 3,770 3,813 4,460 6,819 Source: Global Trade Atlas Imports of Mollusks and Other by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 United States 30,393 42,231 77,702 53,881 Korea North 24,679 12,650 48,536 42,557 Peru 82,113 57,112 26,485 26,352 Korea South 81,124 37,187 25,189 31,660 Japan 12,255 9,171 20,014 13,542 Mexico 6,669 2,478 8,030 9,743 New Zealand 12,410 9,977 7,903 11,351 Other 148,360 104,174 69,666 71,666 World 398,003 274,980 283,525 260,752 Price $/MT 1,183 1,434 1,807 2,260 Imports of Fishmeal by Country of Origin (Volume: MT) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 Peru 876,338 730,369 611,776 677,118 Chile 239,351 339,922 130,709 104,993 United States 76,978 88,708 66,578 121,513 Thailand 5,865 6,710 49,408 14,558 Russia 49,138 40,168 46,373 32,031 South Africa 13,300 8,567 25,866 13,120 Pakistan 12,807 17,896 21,131 12,064 Vietnam 2,380 4,696 18,459 14,696 New Zealand 16,646 16,986 15,685 7,020 Argentina 21,979 18,770 13,907 17,491 Other 33,894 35,273 38,358 50,361 World 1,348,676 1,308,065 1,038,250 1,064,965 Price $/MT 1,036 995 1,602 1,474 Source: Global Trade Atlas Exports of Fish Fillet by Destination (Value: $ million) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 United States 636 945 1170 962 Japan 430 479 589 579 Germany 475 464 479 420 United Kingdom 196 175 178 175 Canada 105 117 131 118 France 95 105 116 142 Brazil 18 13 104 147 Poland 50 69 95 108 Netherlands 97 90 90 95 Mexico 4 53 88 73 Russia 56 93 85 87 Spain 77 68 84 96 Korea South 47 74 80 62 Belgium 55 53 64 58 Other 261 308 338 388 World 2,602 3,108 3,692 3,513 Price $/MT 3,974 Exports of Prepared and Packaged Fish and Caviar by Country (Value: $ million) Source: Global Trade Atlas Exports of Prepared and Preserved Crustacean and Mollusks by Destination (Value: $ million) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 Japan 750 562 646 671 United States 579 455 540 477 Taiwan 71 58 167 178 Hong Kong 134 70 141 316 Korea South 172 99 134 149 Canada 92 76 110 81 Malaysia 217 47 100 119 Mexico 58 44 77 72 Russia 102 46 66 75 Australia 61 48 60 78 Singapore 17 44 40 29 Other 344 232 280 390 World 2,598 1,781 2,362 2,634 Exports of Shrimps and Prawns by Destination (Value: $ Million; Volume: MT) (Value: in $ million) Country/Year Jan-Dec/08 Jan-Dec/09 Jan-Dec/10 Jan-Oct/11 United States 263 321 322 260 Japan 252 246 252 264 Malaysia 212 141 207 238 Hong Kong 77 92 131 110 Canada 75 89 122 77 Taiwan 28 76 119 112 Spain 103 90 98 76 Korea South 70 76 97 118 Mexico 52 56 89 74 Russia 29 45 73 59 Australia 50 55 71 76 Other 170 197 220 196 World 1,381 1,483 1,801 1,660 (Volume: MT) Country Jan-Dec 2008 Jan-Dec 2009 Jan-Dec 2010 Jan-Oct 2011 United States 40,928 47,409 45,331 33,786 Japan 37,339 34,705 35,342 50,654 Malaysia 30,156 18,372 25,722 26,787 Korea South 26,240 27,040 25,278 27,770 Spain 25,448 23,619 23,179 15,256 Hong Kong 11,421 15,003 20,444 15,015 Russia 6,024 10,086 15,694 9,416 Canada 10,160 11,745 15,229 8,669 Mexico 9,865 8,139 12,273 8,590 Taiwan 5,380 8,729 11,851 10,198 Australia 7,863 7,918 8,993 7,862 Portugal 1,679 3,788 5,416 2,937 United Kingdom 2,642 2,542 4,017 3,489 Other 23,825 25,265 24,166 20,857 World 240,978 246,369 274,945 241,286 Price $/MT 5,631 6,021 6,549 6,881 Source: Global Trade Atlas Exports of Shrimps and Prawns by Category (Value: $ Million; Volume: MT) (Value: in $ million) Jan-Dec Jan-Dec Jan-Dec Jan-Oct Country 2008 2009 2010 2011 Shrimps and Prawns 1,381 1,483 1,365 1,145 ***Shrimps And Prawns, Prepared Or Preserved 1,133 639 487 636 ***Shrimps And Prawns, Frozen 236 734 645 570 ***Shrimps And Prawns, Not frozen 11 109 83 86 (Volume: MT) Jan-Dec Jan-Dec Jan-Dec Jan-Oct Country 2008 2009 2010 2011 Shrimps and Prawns 240,978 246,369 212,120 191,509 ***Shrimps And Prawns, Prepared Or Preserved 182,854 93,421 83,024 71,990 ***Shrimps And Prawns, Frozen 52,120 127,950 109,522 100,363 ***Shrimps And Prawns, Not frozen 5,968 24,907 19,482 19,080 $/MT-Shrimps and Prawns 5,731 6,021 6,436 5,977 Source: Global Trade Atlas Exports of All Tilapia Products by Destination (Volume: MT) Country Jan-Dec 2008 Jan- Dec 2009 Jan-Dec 2010 Jan-Oct 2011 United States 118,538 137,372 168,818 110,458 Mexico 36,522 36,185 43,211 34,215 Russia 17,117 21,861 20,273 14,318 Poland 3,734 3,750 7,497 4,111 Israel 4,146 6,643 7,000 7,028 Cote d Ivoire 5,279 4,372 6,922 7,604 Cameroon 54 4,156 6,817 14,653 Angola 1,589 2,606 4,953 5,485 France 1,623 2,929 4,258 5,035 Spain 793 1,979 3,816 3,638 Netherlands 2,757 3,112 3,035 3,120 Other 32,207 33,983 46,234 46,598 World 224,359 258,948 322,834 256,263 Price $/MT 3,269 2,743 3,116 3,298 Source: Global Trade Atlas
Posted: 22 January 2012

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