November 2, 2023

 

China's fishmeal shortage throws producers into turmoil

In early July this year, the pre-sale reference price of Peruvian CNF fishmeal for the new season was US$2150/tonne, and the price of Peruvian super-grade fishmeal in China was in the range of ¥18,400-18,500/tonne (US$2,571-2,585), 40-50% higher than the same period in 2022.

 

The reason behind the rallying fishmeal prices was Peru's delay in announcing its fishing plan for 2023. Meanwhile, the supply of Peruvian fishmeal in the Chinese market gets tighter every day. From June to September, China's aquaculture production will enter its peak, potentially exacerbating the supply shortage as the demand for fishmeal soars. Fishmeal prices are therefore set to skyrocket.

 

China's aquafeed producers are not well-prepared to substitute fishmeal with other ingredients even as the substitution of fishmeal in aquafeeds started several years earlier. With the availability of fishmeal dwindling, it's hard to avoid a spike in aquafeed prices.

 

That said, the inclusion of fishmeal in common aquafeeds have stopped for a long time. The most common ingredients to replace fishmeal are animal protein types like spray-dried blood cell meal and shrimp meal. Plant protein materials include soybean meal, fermented soybean meal, corn gluten meal and peanut meal. Also, in the past two years, various insect protein meal and single-cell protein (SCP) are used.

 

However, such raw materials can only partially replace fishmeal. For example, the inclusion rate of dried black soldier fly cannot be more than 5% while the inclusion rate of ginseng fermented product in shrimp feed can only replace up to 10% of fishmeal.

 

For feeds for carnivorous aquatic species, the inclusion of fishmeal must is a must. Reducing fishmeal in feed formulations will easily result in amino acid imbalance, poor palatability and anti-nutritional factors. Fishmeal also contains a high amount of organic selenium that has growth-promoting effect on carnivorous aquatic animals.

 

With the scarcity of super-grade Peruvian fishmeal, Chinese feed producers may look to source Japanese fishmeal. However, the price rally of Peruvian super-grade fishmeal had lifted the prices of Japanese fishmeal to ¥17,800/tonne (US$2,488).

 

The pressure on aquafeed producers will continue to mount amid the persisting shortage of fishmeal and skyrocketing prices. Chinese fishmeal traders projected that many smaller aquafeed producers will face a challenging period -- strengthening the possibility that some would be acquired by large producers while others would shut down by next year.

- Shi Tao, eFeedLink