Wednesday, 6 November 2019
On the last Annual Conference's day, the Market Forum gave a global overview of the fishmeal and fish oil markets and included country presentations by IFFO members. The closing session delved into global salmon farming market trends, aquafeed production in Africa, fishmeal application in pig feed and unmatched benefits of fishmeal and fish oil to provide Omega-3.
1/ Asia consumes over 70% of the global fishmeal
IFFO's Enrico Bachis and Neil Auchterlonie provided an in-depth analysis of the fishmeal and fish oil demand. Peru remains the main fishmeal production and exporting country, while China is the biggest consumer. Aquaculture and pig feed output drive the Chinese consumption. Globally, it is the aqua sector to have the biggest intake, with over 70%. Asia as whole (thanks to its aqua sector) consumes over 70% of the global fishmeal. Peru is also the main producer and exporter of fish oil, with Norway being the biggest importer. Aquaculture worldwide consumes 70% of the fish oil, followed by the pharmaceutical sector with 20%. Consumption by regions is dominated by the role of the salmonids farming industry in Europe and Latin America. The share of fishmeal consumption by the pig sector is expected to decrease in China in 2019 following the African Swine Fever epidemics. The chicken sector appears the one more sensitive to price variations with 2 important diet changes in 2010 and 2014.
2/ Global fish oil production is higher than expected
Holtermann's Christian Meinich indicated his forecast for the global fish oil production to be at 921,000 metric tons for 2019. This is higher than expected, due to higher-than-expected anchovy fishing quota in Peru, although production is still down 70,000t compared with 2018's bumper year. He added that consumption is stable at around 800,000t.
3/ Most of the growth in the Omega-3 market is concentrated in Emerging Economies
Continuing on the fish oil side, GOED's Aldo Bernasconi gave an Omega-3 market update. Highlighting a global growth by 2% in the omega-3 market volume, he noted that most of the growth is concentrated in Emerging Economies. Dietary supplements are adding the most volume but as a percentage of the total volume, Infant Formula is growing the fastest. Results of recent large trials may affect consumer and healthcare practitioner perception on crude oil in a near future.
4/ Rising fishmeal prices in Europe in 2019 led to a reduction of inclusion in salmon feed diets
Jon Tarlebo from Norsildmel stated that export statistics from European producers underlines how the market balance in Europe affects sales activity outside Europe. He also noted that fish farming companies have been rated as the most sustainable protein producers in the world according to the Coller FAIRR Protein Producer Index, evaluating 9 risk and opportunity factors on sustainability. This year, new studies revealed the positive effect of marine ingredients: researchers from Nofima reported that the barrier tissue of salmon is affected by zinc and omega-3 levels in feed. Fishmeal and fish oil are excellent sources of many micronutrients and among the many different compounds present that contribute to fish (and consumer) health are zinc and the long chain fatty acids, EPA and DHA.
5/ Fishmeal in North America primary goes to pet food
Mike Cici from Scoular explained that as part of the U.S. & China trade dispute, pork, is listed and subject to a potential 25% tariff. China is U.S.’ third largest pork export market. Overall U.S. pork exports fell 3.9% by volume and 8.4% by value from May 2018 to April 2019. ASF in China and other ASEAN countries continues to affect piglet crop so (piglet) feed production and consumption remains at decreased levels thus could have affected USA fishmeal exports to China. In Mexico, short aquaculture season, weather issue like heavy rains and a hurricane hampered shrimp production.
6/ China: Impacts of trade war on fish oil tariff - Recovery of pig farming despite continued challenges
IFFO's Maggie Xu indicated that MOARA had promulgated the revised draft of China fisheries law on 28th August 2019. On the supply side, China fishmeal and fish oil output increased significantly between 2017 and 2018 as well as China’s imports in 2019 compared to the same time period in 2018. China's major supplier for fishmeal and fish oil remains Peru. The overall fishmeal supply is expected to decrease. Maggie also commented the consequences of the current trade war between China and the US: 22% Tariff on US fish oil is being applied since June 2019 and 2% on fishmeal since September 2019, compared with 12% Tariff on US fish oil before trade war. The tariff on fishmeal was 2% before the trade war begins. An application of exempting punitive tariff on fish oil was submitted recently. The pig farming sector is recovering despite continued challenges. The aquatic consumption has become stronger thanks to ASF and the aquaculture sector is moving offshore. The penetration rate of compound feed is supported by government policy.