As of writing, the Marine Institute of Peru (IMARPE) is carrying out scientific research before submitting the evaluation report to the Ministry for the final decision on the quota for Peru’s second anchovy fishing season.

For the first eight months of 2021, a total of 3.18 million tonnes of raw material were reportedly landed in ports along the Peruvian coast, revealing a 34 percent increase compared to the same period of last year. Consequently, the increased quantity of raw material has translated into an almost identical growth in fishmeal output in Peru, registering 763 964 tonnes from January-August 2021.

The cumulative production of Chile in the same review period reported a growth at around 10 percent with the total production quantity at 284 482 tonnes. Denmark, the Faroe Islands, and Iceland, key European players, observed a decrease in terms of the total yield of fishmeal.

In terms of fish oil, only two countries reported more than 100 000 tonnes of yield from January-August 2021 with production in Peru and in Chile amounting to 133 649 tonnes and 116 501 tonnes respectively.

Exports of fishmeal from Peru surged to 722 055 tonnes in the first half of 2021, reflecting an increase of 171 percent compared to the same period of 2020. In addition, exports have already overpassed the level achieved in the same period of 2019,   illustrating a recovery from the COVID-19 pandemic for global fishmeal trade. The rebound is largely due to a positive first fishing season in Peru and other main producers.

In terms of fish oil, Peruvian exports increased by 166 percent from 46 849 in 2020 to 124 650 tonnes in the first half of 2021. Traditionally, Denmark is the main destination market in absorbing Peruvian fish oil, however, during the reporting period, Norway became the largest importer.

China the largest market for fishmeal consumption, has seen a growth of imports by 68.3 percent from 564 368 tonnes in the first half of 2020 to 544 757 tonnes in the same period of 2021. This growth was attributed to the aquaculture season and increased demand of the pig farming sector, however, pig farmers have been seeing very   marginal profits, which may lead to a shrinkage of fishmeal imports in China.

In addition, there were nearly no fishing activities along the coastal sea in China from May-September 2021 due to the moratorium, which leads to rarer raw material supply to domestic fishmeal plants. Port stocks of fishmeal currently in China remain stable as well.

In terms of fish oil, Norway remained the biggest importer, registering 93 222 tonnes from January-June 2021, which was an increase of 14 percent compared to the same period of 2020.

Since early 2021, the prices have been gaining some upward momentum. Although, the pandemic has been impeding the economic performance in many countries, recovering demand in China and other economies keeps absorbing fishmeal and fish oil products. Since the start of the first fishing season in Peru, the bump harvest started to drive prices down.

There is currently no negative news of the biomass and the weather conditions for the upcoming second fishing season in Peru, which brings more confidence to the industry. However, the adjustment of the government structure may have some implications.

Exports from Peru to China have grown substantially, and it is expected to see this trend continuing until the end of this year.

It is expected that the negative impact of COVID-19 on the trade of fishmeal and fish oil will disappear, as a quicker response from competent authorities, together with the intensified customs control systems would safeguard the smooth flow of international trade of commodities.

Prices of fishmeal and fish oil have hovered at high levels for several months and in the short term prices are expected to moderate a bit with the ample supply from Peru. With the positive forecast for Peru’s second fishing season, it is likely that the prices will be trending downwards, though gradually and marginally. The transportation costs are still high due to the global shortage of containers, which may pose some price trend uncertainty.