The fishing in the south of Peru started in mid-January 2012 with the announced 400 000 tonne quota to be taken before the end of June.

FISHMEAL

The fishing in the south of Peru started in mid-January 2012 with the announced 400 000 tonne quota to be taken before the end of June. However, by the end of March only 78 000 tonnes had been caught and it is possible that the Peruvian authorities could reduce the quota for anchovy this year as changes in water temperatures necessitate new regulatory measures aimed at safeguarding the resource.

In a period where demand is increasing because of rising production in the aquaculture and livestock sectors in general, lower landings are likely to cause  fishmeal prices to firm over the next months, also boosted by an increase in soybean prices during the first quarter.

Fishmeal production in IFFO countries increased by 40% during 2011 as catches in South America returned to normal levels. Northern European production fell as a higher percentage of catches was taken up by direct human consumption.

Peru is the major exporter with almost 60% of its production now going to China. Of Peru’s exports, a total of 73% is taken by Asian buyers.

Chile saw exports stabilize in 2011 despite growing demand as domestic salmon producers took most of the additional output. China is Chile’s main export market as well.

In China, inventory levels are reportedly around 200 000 tonnes.

EU

Norway, Iceland and Morocco are becoming more important to European buyers with a combined share that has almost doubled from 2009 to 2011 (13% to 22%). However, the EU continues to rely on South American sources for a substantial part of its fishmeal needs.

Germany

Although imports are declining in both absolute and relative numbers, Germany is still an important hub for Europe for fishmeal distribution because of its processing facilities. The reason for declining imports is the dominant role taken by China for Peruvian and Chilean fishmeal exports and as an importer of raw material in general for food producing sectors.

UK

The UK has also registered declining imports for the third year in succession because of relatively high prices. Buyers compensated for this by turning to alternative protein sources, mainly soybean. Rising production of salmonoids in Scotland gave rise to increased demand from the aquaculture sector, but other sectors saw purchases fall back.

US

Trade in the US market was fairly stable in 2011 with total imports around 35 000 tonnes. Purchases from Mexico increased considerably compared with 2010 although volumes are still lower than historic levels.

Outlook

Fishmeal prices can be expected to rise this year as a consequence of lower catches projected in South America in a time of firm demand, growing needs in the aquaculture sector and rising prices of the soybean substitute.

FISHOIL

Fish oil supply increased to almost normal levels during 2011 as South American production returned to the market after the El Niño year in 2010. Peru and Chile boosted their production while North European producers registered lower levels and raw material went for direct human consumption.

Peruvian exports declined by 10% in volume in 2011. Chile saw shipments increase by 24% while US exports fell by 15% because of lower menhaden shipments to export markets. Landings during early 2012 were lower compared with the same period in 2011. Only Iceland increased production, thanks to catches of small pelagics.

Outlook

Uncertainty in South America and lower oil production during early 2012 in Northern Europe should see higher prices during the coming months.