After an overall decline in imports in 2018, US tilapia traders who bought in anticipation of a 1 March tariff hike that never happened may be left with too much fish to sell amidst falling prices and weak demand.

Production

Global production of tilapia in 2018 is estimated to have increased by some 3 –4 percent to around 6.3 million tonnes, continuing a trend of consistent annual growth that has now lasted some 20 years. China remains the leading producer, accounting for around 28 percent of total production and for a significantly larger proportion of global export volume. However, China’s share of farmed tilapia production has been declining as harvests in countries like Egypt, Indonesia and Brazil are now increasing relatively faster. A sustained downward slide in prices and a deterioration of market conditions in the major US market has seen some Chinese aquaculture operators start to explore alternative species. There is a steadily smaller share of tilapia production entering international trade, as many of the more rapidly growing producers are more focused on supplying their domestic markets.

The Brazilian sector is expanding at a rapid rate, with production growing 11.9 percent in 2018 to 400 280 tonnes, according to the Brazilian Aquaculture Association (Peixe BR). This figure represents 55.4 percent of Brazilian fish production and ranks Brazil as the fourth largest tilapia producer worldwide. The bulk of the country’s tilapia aquaculture operations are located in the south of Brazil, in the states of Paraná and São Paulo.

In sub-Saharan Africa, where tilapia farming is still relatively small scale, producers have been struggling with disease problems. Authorities in Ghana are directing large-scale vaccinations following two mass mortality events at tilapia farms on Lake Volta attributed to bacterial infection. In the Southern part of the continent, Tilapia Lake Virus (TiLV) continues to threaten tilapia in Lake Victoria, where the species represents an important source of lowcost protein. In response, FAO have partnered with the Ugandan government and academics to develop and implement a coordinated strategy to mitigate the risks and impact of TiLV’s presence in the region.

Markets

Demand for tilapia in the US market did not show much sign of recovery in 2018, as marketers continued to struggle to generate new consumer interest in tilapia products. There are few indications of any imminent reversal of the downward trend, as recent statistics from the NFI suggest that other seafood options such as salmon are steadily taking over tilapia’s market share. Tilapia from China, which is all frozen, is losing market share to fresh product, but even fresh fillet suppliers from South America are suffering from poor consumer perception and the availability of more versatile fish species. Further penetration of the lukewarm EU28 market is also proving difficult, with companies now adopting an approach centred in quality to attempt making headway in this potentially lucrative market.

Progress in Asia, Latin America and Africa has been much more rapid, particularly in domestic markets of producing countries. Brazil exports only a small proportion of its fast-growing production, while China’s domestically produced tilapia is proving popular as a convenience seafood item in the retail sector and in fast-food outlets. Meanwhile, subSaharan Africa is absorbing growing volumes of both regionally produced tilapia and Chinese exports once destined for the US market.

Prices

Although demand has been dreary in the United States of America and the EU28, domestic market demand in producer countries and from newer export markets kept traded tilapia prices relatively steady in 2018. FOB prices for frozen fillets out of China have hovered around USD 3.00–3.40 per kg through 2018, while frozen whole fish ranged between USD 2.00–2.20 per kg. For fresh fillets from Latin America, FOB prices bounced between USD 6.50–7.20 per kg.

Outlook

US buyers’ accelerated buying from China in late 2018 and early 2019 turned out to be premature. The increased availability of fish on the market is threatening price levels in the first half of 2019. Price and market development is heavily dependent on when and if the 25 percent tariff does indeed take effect. This added barrier to Chinese access to the US market could prompt something of a reshuffling of trade routes and offer some opportunities to Latin American suppliers, although fresh Latin American tilapia is not a direct substitute for frozen Chinese product that still is significantly cheaper even with a 25 percent duty. The Brazilian and Colombian tilapia industries are on strong growth trajectories, with Brazilian producers focusing primarily on the domestic market and Colombia looking to develop its export business. Global production of tilapia is expected to increase by around 3 percent to 6.5 million tonnes in 2019, with Chinese growth continuing to lag that of other major producers.