March 1, 2005
Huge demand in China for Philippine seafood products
A huge demand for Philippines Mindanao's sea cucumber, grouper, abalone, sardines, tuna, cuttlefish and other seafood products is waiting to be met in China.
This was discovered by 13 representatives of the country's leading marine and aquaculture commodity exporters who participated recently in the 9th China Fisheries and Seafoods Expo at Qingdao, Shandong Province, China.
The greatest number of inquiries came from Chinese buyers of sea cucumber. Most of the buyers were interested in meeting local demand but a few were selling products for export to Chinese restaurants in Canada and the United States.
"The Chinese buyers who visited the Mindanao booth appeared overwhelmed to see our display of sea cucumber and their competitive prices. The price we gave was much lower compared to the prices of other companies," said Agnes Luz, Export Market Development Manager of USAID's Growth with Equity in Mindanao (GEM) Program, which helped organize the delegation.
The GEM Program has been at the forefront of promoting Mindanao commodities by providing technical and marketing assistance to key players of major industries to help them hit the export market, especially China.
For the last five years, China's international seafood trade has doubled to almost $8 billion. In 2003 alone, Chinese buyers imported US$2.3 billion worth of seafood. Mindanao can produce high quality, high value goods to tap this market.
In China, dried sea cucumbers are only available in big supermarkets and displayed in glass cases with locks. A half-kilo of dried sea cucumber sells at the equivalent of PhP 12,000. Mindanao exporters at the expo displayed their sea cucumbers in bulk packs, which made it more affordable for Chinese buyers than those of other exhibitors, which packaged their sea cucumber as gift packs for high-end markets.
Dried sea cucumbers, also known as beche-de-mer or sea ginseng, are a popular dish at Chinese New Year's banquets and other festive celebrations. It is famous for its medicinal value and its reputation as an aphrodisiac.
Recent scientific findings published in the Food and Agriculture Organization (FAO) website reported that sea cucumbers and their processed products are alleged to cure certain forms of cancer, such as lymphoma and breast cancer.
A number of Chinese buyers also inquired about frozen abalone in Individually Quick Frozen (IQF) form. IQF is a process that makes food products retain the texture, nutrition and good taste with the use of a quick freezing facility. The Mindanao delegation observed that Chinese buyers also prefer frozen and dried products packed in transparent polyethylene bags and vacuum packs.
"Chinese consumers are often suspicious of products packed in cans. Our companies will have to suit the taste of Chinese consumers if we are to successfully compete in the China market," explained Stan Swerdloff, Aquaculture and Fisheries Advisor for the GEM Program.
Other than at the Mindanao booth, only three other booths displayed abalone in the two-day Expo. Their products were canned and priced at about the same range with that of Mindanao products. Each can was priced at PhP 1,050.
However, Mindanao's abalone came in transparent packs and attracted a great deal of interest. Like the sea cucumber, dried abalone is only available in China's big supermarkets placed in glass cases with locks. They are priced at PhP 1,460 per half kilo.
Although China is already producing cultured abalone, the high price of this product in the local market indicates that there is still a substantial lack of supply. Data from the website of the abalone consultancy firm, Fishtech, indicated that world production of cultured abalone registered a phenomenal growth from just 689 metric tons (MT) 16 years earlier to 7,165 MT in 1999 and 8,696 MT for the year 2002.
The Philippines falls behind nine other country producers with an average annual production of 211 MT (data taken from Philippine Council for Aquatic and Marine Research and Development). China and Taiwan lead with an annual production of 4,500 MT and 3,000 MT respectively (86 percent of the total production).
According to Jimmy Fernandez, Bureau of Fisheries and Aquatic Resources (Bfar) 11, there are three government-led abalone hatcheries in the Visayas but they are still in the research and development stage. In Mindanao, abalone production research is also being undertaken by the Alsons Hatchery Research and Development Group in Sarangani. As for sea cucumber, Fernandez said they have a research site in Barangay Bato, Sta. Cruz, Davao del Sur.
"Our best move is to focus on private sector commercialization of the technology. The China market is strong and yearning for more. We need people who will invest in abalone and sea cucumber hatcheries to ensure the sustainability of this growing industry," Luz said.
Mindanao tuna also generated a lot of interest from foreign buyers that wanted supplies of fresh tuna and tuna in pouches. Chinese buyers flocked to the taste test of tuna for sashimi. Although tuna has been one of Mindanao's export winners, Philippine tuna exports to Asian countries have been largely confined to Hong Kong, Taiwan, Korea and Japan until the last two years when direct exports to China by General Santos City-based tuna companies increased by 61 percent.
"Several companies have been making an effort to distribute their tuna products to China. Century Tuna has been doing a lot of promotion in China and it's paying off," Swerdloff said. He is optimistic that with China market's huge buying power, there's plenty of opportunity for other tuna producers.
Since the conclusion of the Expo, Ocean Aquamarine, one of the country's leading seafood exporters has sent samples of sea cucumber to a Qingdao buyer. Korean buyers also ordered a container load of tuna valued at US$ 160,000. Their first shipment bound for New York and New Jersey, was made in January. As a result of participating at the Expo, Mindanao companies have received visitors and orders from China, Korea, Hong Kong, Vietnam, Denmark and the United States.
