Norway and the EU finally reached an agreement on mackerel quotas and the management regime for North Atlantic mackerel in early December 2010, after long and hard negotiations, which in some quarters were dubbed "the mackerel war".

Mackerel

The "mackerel war" refers to the refusal by Iceland to continue negotiations with Norway and the EU and accept a lower quota, after unilaterally setting its own quota for 2010 at 130 000 tonnes. In retaliation, Norway banned landings of mackerel from Icelandic vessels in Norwegian ports, while the EU threatened to do the same. The EU and Norway felt that Iceland, which did not fish mackerel until recent years, should not have a greater quota because of its history of non-participation in this fishery. However, in recent years, mackerel has started moving further to the north and west, thus entering Icelandic waters, prompting Iceland to claim a larger share of the quota.

The mackerel quotas for 2011 will amount to 583 882 tonnes, of which 183 069 tonnes were allocated to Norway, and 400 813 tonnes to the EU. As under the previous agreement, both parties will be allowed to take a larger part of their quotas in each other’s EEZs. Horse mackerel quotas remained at the same level as in 2010 at 181 000 tonnes.

Iceland and the Faroe Islands have been selling lower quality mackerel to mainly east European markets, and at lower prices. This has put pressure on prices in these markets, and Norway registered a slight decline (-1.5%) in average export prices during 2010. However, price reductions were strongest on east European markets such as Belarus, Ukraine, Russia and Poland. Prices on the most important market, Japan, actually showed a 6.2% increase compared with 2009.

The largest supplier, Norway, registered a dramatic increase in exports during the first nine months of 2010. Exports of frozen whole mackerel increased by 124% to 176 600 tonnes. However, preliminary figures for the whole of 2010 indicate that exports grew by only 40%, though still an impressive increase. Prices remained relatively stable compared with 2009.

The most important market for frozen mackerel, Japan, showed a dramatic return to previous levels with a 370% increase in imports of Norwegian mackerel during the first nine months of the year. However, these figures hide a shift in seasonal imports, as the total for the whole of 2010 indicates an increase of only 40.2%.

China continues to import massive amounts of frozen mackerel from Norway. During the first nine months the country imported 33 276 tonnes, which was 203% more than during the same period in 2009. However, by the end of the year, China’s imports of Norwegian whole frozen mackerel amounted to 51 033 tonnes, which represented a 52.3% increase over 2009.

German imports of frozen mackerel have been steadily rising during the past four years, and this trend continued in 2010. During the first nine months of the year, German imports of whole frozen mackerel increased by 12.1% to just over 7 400 tonnes. Of this, only a very small part came from Norway (366 tonnes). Ireland and the Netherlands were the main suppliers to Germany.

In spite of the much improved supply situation, prices have remained remarkably stable over the past year. With increased quotas and the expectation of increased supplies, prices could be expected to come down, but this is not certain.

Herring

While the total mackerel quota was increased, the quotas for herring were cut back. In an agreement between Norway, the EU, the Faroe Islands, Iceland and Russia, the quota for NVG (Norwegian spring-spawning) herring was also reduced significantly, from 1 483 000 tonnes in 2010 to 988 000 tonnes in 2011. Of this total quota, Norway’s share is 61%, or 602 680 tonnes.

The situation for the Baltic herring stock seems to have improved, and therefore scientists are recommending a higher quota for 2011. ICES has advised that the Baltic herring quota can be increased from 15 884 tonnes in 2010 to 26 800 tonnes in 2011.

The lower quotas for 2011 are expected to create a situation characterized by an imbalance between demand and supply. One of the most important markets for herring, Ukraine, expects to have its supplies of herring cut by some 20%. Consequently, some price increases must be expected.

African buyers have been asking for more and larger fish, but with the lower quotas, this is going to be hard to secure. Consequently, some expect prices to go up by as much as 25% in 2011. In addition, the shortage of herring may put some price pressure on mackerel, too.

Norway’s exports of whole frozen herring showed a slight decline (-1.9%) during the first nine months of 2010, but by the end of the year the decline was over 10%. While the main market for Norwegian herring, Russia, only showed a slight decline, there were some major changes in other markets. The second largest market, Nigeria, also showed a decline in imports by almost 17% during the first nine months of 2010, but bounced back in the fourth quarter and ended the year with an 8% increase in imports of Norwegian herring.

Egypt has only been importing Norwegian herring since 2008. In 2007, the country imported no herring at all from Norway. During the first nine months of 2010, Egypt imported 21 800 tonnes, compared with just 10 000 tonnes in 2009. The Netherlands also showed growth in its herring imports from Norway; +29.6% increase in 2010.

In general, Norwegian herring export prices were relatively stable during 2010, but there were considerable variations from market to market. The average export price inched up by 2.9%, while prices paid by Nigeria increased by 11.6%. Prices paid by Ukraine dropped by 2%.                                                             

The German market for herring developed well in 2010. Imports of frozen herring into Germany increased by 24.6%, to 22 800 tonnes during the first nine months. Norway remained the main supplier, and increased its market share, while Denmark and the Netherlands remained in second and third position.

The Japanese herring market also showed growth, as imports increased by 17% during the first nine months of the year. The USA strengthened its position as the main supplier, seeing its market share growing from 72.5% to 74.6%. Other main suppliers were Russia and Norway.                                                   

The French market, in contrast, weakened and exports fell by just over 3% during the first nine months of 2010. Norway is still the leading supplier, with a 61% share of French imports. Iceland and the Netherlands also increased their exports to the French market. 

Canned sardines

The stagnant situation in the canned sardine industry continued into the third quarter of 2010. Landings in Morocco were still disappointing, and the weak supply situation is reflected in the overall decline in trade. The important markets such as Germany and France continued to reduce imports, while the only bright spot was the UK, where imports during the first nine months continued to increase. At the end of the third quarter, UK imports of canned sardines had increased by over 20% compared with the same period in 2009.                                                      

Pilchard

A few years ago, Namibian canned pilchard was very successful in Europe, especially in the United Kingdom. However, reduced quotas and poor landings towards the end of the decade put an end to this trade, but now it appears that the situation is improving.

Despite a quite considerable biomass increase, the pilchard fish stock off Namibia and South Africa is still in a critical condition, when compared with historical levels. Hence the Namibian government has set up stringent measures and management plans for the pilchard sector, which, it is believed, will lead to the long term sustainability of the stock. This includes limiting pilchard by-catch in all other fishing industries to no more than 3% of total landings. In 2007, more than 50% of the total pilchard catch was from by-catch. The 2008 survey revealed a 55% total biomass increase compared with 2007. The pilchard TAC for 2006 was 25 000 tonnes but dwindling stocks resulted in a reduction of 15 000 tonnes for 2007 and remained the same in 2008. In the 2009 fishing season the TAC improved slightly to 17 000 and further to 25 000 tonnes in 2010.

Having recovered to some extent, the industry still remains but a fraction of the size it once was. For instance, in the early 1990s, pilchard TACs were as much as four or five times the current size. It is to be noted that similar measures have been taken by the South African government with regard to pilchard catches. Natural mortality remains very high for the pilchard stock as a result of predation by seals, squid, birds and other fish.

Pilchards are canned mainly within Namibia and in South Africa, and are also destined for the South African and UK markets.

Horse mackerel

In the southern hemisphere, horse mackerel, as well as pilchard, is of major importance. Namibia has just announced that its quota for horse mackerel will be increased from 245 000 tonnes in 2010 to 310 000 tonnes in 2011. Most of the Namibian horse mackerel is exported to West African countries.

In terms of total volume landed for the past five years, Namibian horse mackerel accounts for 50% to 60% of the total. Landings of horse mackerel decreased from 2005 till 2008, and then picked up slightly from 2009 with total landings of 215 051 tonnes, which represent a 10% increase. According to research surveys, the reduction was caused by a decline in biomass from 546 000 tonnes in 2006 to 535 000 tonnes in 2007. However, there has also been an overall reduction in the size of captured fish and this indicates that the fishery was under pressure. Furthermore, an increase in catch landed is noted for the second quarter of 2010 (70 386 tonnes) compared with 60 850 tonnes during the same period in 2009.

The Democratic Republic of Congo (DRC) is the main destination for horse mackerel exports,as well as other African countries. These are sold mainly in whole frozen, fresh or chilled form and as fishmeal.

Export value of Namibian frozen horse mackerel increased by 24% from USD 65 million in 2008 to USD 104 million in 2009. In the first quarter of 2010, horse mackerel exports were 27 797 tonnes and were valued at about USD 33 million, while in the second quarter of the same year, 25 473 tonnes were exported, valued at about USD 41 million.

The value of exported fresh/chilled horse mackerel increased by 73%, from USD 0.5 million in 2008 to USD 2 million in 2009. During the first quarter of 2010, horse mackerel exports (885 tonnes) were valued at about USD 3 million while 357 tonnes were exported valued at USD 1 million in the second quarter.

Outlook

For mackerel, with increased quotas and higher supplies, prices should soften somewhat.

The lower quotas for 2011 are expected to create a situation characterized by an imbalance between demand and supply. Consequently, some price increases must be expected.