Coronavirus Update

The following information is provided by the Seafood Trade Advisory Group (STAG) as an industry market intelligence service to its subscribers. Efforts are made to verify the information however this is difficult given the current market situation. Readers should verify the information independently before taking any action based on the information provided.

STAG Exporters Update

Here is a summary of the current market situation as we understand it:

China consumption remains very slow with sales to restaurants still largely not open
Limited rocklobster fishing has resumed in all states
Domestic market continues to be strong for lobsters over 1kg
Majority of inventory held has now been sold for Southern Rock Lobster
Prices for domestic and export still well under levels prior to virus for rocklobster
South Australia and Western Australia rocklobster quota roll over/season extensions still in consultation phase
New Zealand rocklobster quota roll over also under consultation
Some initial sales inquiries from Chinese importer companies (with premises based in Hong Kong) starting to make some contact with abalone exporters. Some exporters have recently received some low ball offers from Hong Kong based importers (i.e. tentative testing of willingness to trade at lower prices). It is believed there has been some small shipments of abalone into Hong Kong during the last week or so
No movement of note from mainland China yet for abalone although it is worth mentioning that there are very few "new" cases of the virus in Shenzhen and Shanghai - health authorities seem to have stabilised the situation in these cities. If the situation remains stable and/or improves, we may expect to see slow resumption of restaurant trade for abalone (in these cities) which will eventually translate into some demand for product and hopefully new orders for exporters
There is apparently some optimism (communicated by abalone importers to abalone exporters) that some seafood trade may begin to resume in China in April/May - this is however speculative and will depend on many factors (i.e. reducing number of "new" virus cases, relaxation of the restrictions on freight logistics within and between cities and between airports/ports and cities/towns)
Other abalone markets (Japan, Singapore, etc.) are seeing increased cases of the virus and the effect of this is hard to know as most canned abalone sales won’t happen until late in the year.
Once trade frees up, importers are expected to take smaller shipments, hold less stock and be very conservative on price. Importers are also sitting on tonnes of frozen product that they had to freeze when the virus broke. There may be a desire to move this fish prior to buying more live. This may also work against Australian exporters by setting the market price at the same as frozen.
Domestic sales for abalone are very slow with many China Town restaurants claiming business is down 50-60%
Other seafood domestic products are now feeling more of the effect. Wholesale prawns, crabs, scallops etc. prices are down significantly. In one case, a wholesaler is reporting new imports of products that would normally go to China now making it to Australian markets and bringing prices down for local caught products
China exports are showing some improved signs but we stress that it is still early days with product moving slowly and in low volumes at reduced prices. China is becoming more optimistic that things will/are getting better or at least heading in the right direction
Reports that the main logistic route to Zhejiang province has re-opened but we are still checking that
Flights to China remain limited and will affect market access in the short term if demand from China increases

The STAG welcomes market updates from members. Details will not be published without permission. Please email your updates to admin@seafoodtradeadvisory.com

Market communications – Austrade digital media opportunity

Austrade have invited us to share China ready content (translated text or voice over) that they can share via their social channels. See the article below about the rapid and extensive use of digital media by Chinese consumers stuck at home in quarantine.

The content needs to be generic (ie. not promote a particular company). They can be sectoral based e.g. Lobster, Abalone etc. or whole of industry.

If anyone has content that they are happy to be repurposed for this, please let the STAG Secretariat know by emailing us at admin@seafoodtradeadvisory.com

Reading the Coronavirus impact on consumer behaviours

Source: China Skinny 19 February 2020
https://www.chinaskinny.com/blog/coronavirus-consumer-behaviour/

Looking into consumer spending behaviour over the past few weeks paints a clear picture that most consumers aren’t yet back in the mood for making frivolous purchases. Rather, they have knuckled down in survival-mode.

Food delivery apps have seen a drop in usage, as consumers cook meals for themselves, not wanting to take risks contracting the virus from chefs or delivery men, on top of having more time to prepare food than in their usual busy lives. To counter the limited stock availability on its fresh platforms, Alibaba and JD are supporting farmers so they’re not left with rotting fruit and vegetables, promoting a service where consumers can buy fresh goods directly from the farmers at cheap prices.

Infographic: Changes in Online User Behaviour Resulting from the Coronavirus
https://www.chinaskinny.com/blog/infographic-coronavirus-online/

Financial impacts on Australian seafood businesses

It is important to document and communicate business impacts so that appropriate assistance can be sought and where possible provided. Seafood Industry Australia is collating this information to support their ongoing discussions with the Federal Government. Please complete the form by clicking here and then email it to Jane Lovell, CEO Seafood Industry Australia at jane@seafoodindustryaustralia.com.au

China Market Updates will be included in our regular STAG NewsBites which will be published later this week.

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STAG Bulletins are a resource for Australian seafood exporters.The Seafood Trade Advisory Group receives funds from the Fisheries Research and Development Corporation. The Fisheries Research and Development Corporation plans, invests in and manages fisheries research and development throughout Australia. It is a statutory authority within the portfolio of the federal Minister for Agriculture, Fisheries and Forestry, jointly funded by the Australian Government and the fishing industry.