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United States top seafood supplier in growing Japanese consumer market.

United States Top Seafood Supplier In Growing Japanese Consumer Market Shrimp, tuna, crab, pollock fastest-growing import categories; total imports passed two million tons in 1987. Warning issued on high-priced Pacific salmon.

Japan is more and more a fish-importing nation; total imports were up 11.1% to 2,075,253 tons and 24.3% to $8.5 billion in 1987, and indications are the surge continued last year.

With the United States taking increasing control of the harvest in its own Exclusive Economic Zone,it has displaced Korea as the greatest source of fishery imports--457,927 tons in 1987, up 16.9% from the year before.

Shrimp remains the largest single category, at 245,892 tons in 1987, up 15.5% from the year before. But tuna and crab showed stronger gains in 1987,up 30.7% and 35.1%, respectively, to 202,687 and 60,024 tons. Cod, pollock and hake were up 14.2% to 168,458.

Ryuichi Tanabe, executive managing director of the Tokyo-head-quartered Japan Marine Products Importers Association, interpreted import trends at the fourth annual Seafood Export Conference held recently in New Orleans, Louisiana. The meeting was sponsored by the U.S. Department of Commerce and several allied federal and state agencies.

The arithmetic behind increased imports is simple, Tanabe said. Between 1975 and 1985, the domestic supply of fish and seafood products declined from 7,552,000 tons to 7,270,000, but demand increased from 7,549,000 tons to 8,410,000. "The gap is bigger in high value fish such as shrimp, salmon, tuna,crab and so on," because these used to be sourced in the 200-mile zones of other countries.

Imports from the United States have been encouraged, not only by development of its own fishing fleet exploiting the Pacific 200-mile zone, but by the fall of the dollar against the yen, he noted -- the exchange rate was 252 yen to the dollar as recently as January 1985; a year later, it was 202, a year after that 159, and by November of last year it had fallen to 124.

As a result, the average price per ton of imports fell from 746,000 yen in January 1985 to 609,000 in January 1986 and 594,000 in January 1987: good news for Japanese consumers. But U.S suppliers were happy, too. In dollar terms, average export prices to Japan per ton increased from $3,132 at the beginning of 1985 to $3,655 at the start of 1986 and $4,092 in January 1987.

"Anyway," Tanabe said, "the import price went down and, with some time-lag, retail prices of imported fish and fishery products began to go down. This certainly stimulated fish consumption, in particular those high value fish which are of higher price-elasticity such as shrimp...At the same time, the rise of exporting prices became incentives for the exporting countries."

But not everyone is happy with the situation. "In the past, imported fish were a supplement to the domestic supply," Tanabe explained.

"But now, some of them are competitors to fish caught domestically, and there are strong repercussions from Japanese fishermen to the import of these products". Tuna, for which, Japanese fleets ply the south Pacific, "is a typical example of this phenomenon."

Tuna and salmon used to compete for second place among Japanese imports, but now salmon has fallen far behind -- at 110,691 tons for 1987, it didn't even match its 1985 performance. What is listed as "cod, pollock and hake" in import statistics has taken third place, and the category is actually dominated by minced pollock -- surimi. Much of the pollock has been sold over-the-side from American vessels, but with the U.S. encouraging domestic production of surimi, the availability of over-the-side pollock has decreased.

This could have a direct impact on the Japanese domestic market. "It may be difficult for the time being for the U.S. to produce high quality surimi, comparable to Japanese surimi processed on board," Tanabe said, "and the supply of the best surimi might decrease on the Japanese market. This will result in a shrunken market for this type of surimi, and I am afraid that once a market shrinks, it is extremely difficult to recover it." It will be interesting to see whether surimi products take hold in the U.S. market while being rejected in Japan.

The falling dollar has not only reduced the cost of imported products themselves, Tanabe noted, but the cost of transportation as well--it is said that today, air freights from neighboring countries such as Korea, China and Taiwan to Tokyo are comparable with those from remote cities in Japan." That means a growing market in fresh seafood products flown into Japan, complementing the increase in frozen products shipped in. This tends to further segment the market into high quality, very expensive products, and cheaper regular products.

Crab imports have increased strongly in the past few years, with Canada and the Soviet Union as well as the U.S. being major suppliers. Tanner crab, sourced in those three countries, accounts for half the imports, and prices for the species have risen every year -- if they get too high, the market may shift to blue crab from China and South Korea, or red tanner crab from North Korea. But the U.S. would have trouble tapping the blue crab market, since China and Korea can sell it cheaper. U.S. exporters are always asking about soft-shell crabs, Tanabe said, but only "curious people" eat them in Japan, and building a substantial market would take "extensive promotional activities."

Yellowfin sole is the most important flatfish being imported by Japan in terms of quantity, with rock sole second. Japanese fishermen frozen out of the U.S. 200-mile zone are making more over-the-side purchases and have "made every effort to develop the market." But an oversupply in 1987 reduced rock sole prices from 700 yen a kilogram to 500, with rock sole edging yellowfin sole out of its usual market. Greenland halibut prices, for much the same reason, fell from 400-450 yen to 300-350. On the other hand, Japan has "started to buy European products just a few years ago and they are expanding because of better quality," Tanabe said.

Salmon Price Warning

Blackcod prices are firming up at 820-850 yen a kilogram, but since salmon prices are higher, "it is expected that consumption is shifting from salmon to blackcod." Importers would like U.S. seafood processors to pack blackcod to Japanese specifications, he said. While the market for Atlantic rockfish was weak last year, it still has an advantage over Pacific Ocean perch in that the bright color is "better appreciated in Japan." As for salmon itself, Tanabe warned, if the price of U.S. imports remains excessive, "a competition with cultured salmon from such countries as Norway, New Zealand and Chile will grow more and more severe" -- imports from those countries have, in fact, already increased markedly.
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Publication:Quick Frozen Foods International
Date:Jan 1, 1989
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