Northern Shrimp Outlook John Sackton Seafood Datasearch Shippagan, March 21, 2018

Transcription

1 Northern Shrimp Outlook 2018 John Sackton Seafood Datasearch Shippagan, March 21,

2 40 Years in Seafood Industry Crab, shrimp and lobster market analyst since 1997 Preseason price and market outlooks on shrimp, crab, lobster US West Coast, Atlantic Canada, Alaska Price arbitrator for Alaska crab Shrimp Analyst for NFI Co-Founder of NFI s Global Seafood Market Conference Publisher of Seafood.com News Background 2

3 Long term supply outlook Global supply of pandalus on long term decline However year to year changes are variable Market concern is what is available today West coast shrimp governed by different factors Recruitment variable in short term Long term outlook for ocean regime shifts 3

4 Global Fishing Areas Pandalus 4

5 Global borealis landings may have stabilized with increases in Greenland and Barents Sea Global Landings of Pandalus borealis May Have Stabilized est 2018 est North Sea Barents Iceland Greenland W greenland East Skagerrak Canada Norway Seafood Datasearch Estimates and ICWPF 5

6 Picture is the same including P. jordani Global Landings of Pandalus borealis Have Stabilized est 2018 North Sea Barents Iceland Greenland W greenland East Skagerrak Canada Norway West Coast est Seafood Datasearch Estimates and ICWPF 6

7 Northeast Atlantic Catches stabilizing; Western Atlantic Declines will continue Dr. Carsten Hvingel Head of Research Section Benthic Resources and Processes Institute of Marine Research, Norway 7

8 Volume in Canada of Larger Size Shrimp has Most Impact on US Market Canadian exports to US are mostly larger size shrimp. Prices of larger shrimp are likely to be higher this year due to cuts in the Gulf of St. Lawrence. Volume of US landings is still not known. 8

9 10-15% Decline expected in Newfoundland area 6 NL area 6: 2018 biomass 86 K tons; at 10% exploitation quota would be 8600 tons vs tons in 2017 Quota is not set, most expect 10-15% decline. Area 5 is mostly stable, mostly offshore shrimp Some industrial offshore production flowing to NL shrimp processing plants. 9

10 Gulf will see big reduction of 35% to 40% 48 0'0"N 49 0'0"N 50 0'0"N 51 0'0"N 52 0'0"N Les Escoumins 50m 69 0'0"W Average Annual Landed Values ($) 1 Shrimp > Average annual landed values for shrimp fisheries between 2008 and Georeferenced and estimated values are presented on a 6.25 km² grid. 300m 50m E1 Baie-Comeau 350m 50m Rimouski Sept Iles 200m '0"W 300m Matane 50m Sept-Îles E2 66 0'0"W 300m m P1 300m 200m P2 Mont-Louis 350m 250m 50m 64 30'0"W Quebec E4 E3 100m Sainte-Thérèsede-Gaspé Rivière-au- Tonnerre Rivière-au- Renard Havre- Saint-Pierre E5 P3 100m 150m 63 0'0"W 100m 50m Île d'anticosti E6 200m 250m P4 350m 61 30'0"W Natashquan 400m 100m 250m E7 P5 9 50m La Romaine 300m 60 0'0"W E9 E8 Tête-à-la-Baleine P6 Anticosti 150m 8 500m E10 200m 58 30'0"W E11 200m E12 E13 100m 100m 50m 250m 50m 200m 200m 300m Channel-Port aux Basques Blanc-Sablon 50m 100m E14 100m 57 0'0"W 50m Rocky Harbour 100m 50m Port au Choix ± 50m Newfounland and Labrador 50m 100m Coral and Sponge Conservation Areas and Geographical Distribution of Shrimp Landings Coral and Sponge Conservation Areas Conservation Area Conservation Area Size i ii : E3 = 530 km² E5 = 346 km² E7 = 845 km² E8 = 939 km² E9 = 215 km² P3 = 496 km² P4 = 821 km² P5 = km² P6-Nord = 335 km² P6-Sud = 423 km² P3-E6-P4 = km² TOTAL iii : km² Significant Coral and Sponge Areas Significant Area Significant Area Size ii : Sponge areas E1 = km² E2 = 851 km² E3 = km² E4 = 502 km² E5 = km² E6 = km² E7 = 753 km² E8 = km² E9 = km² E10 = km² E11 = km² E12 = 779 km² E13 = 587 km² E14 = 568 km² Sea pen areas P1 = km² P2 = 470 km² P3 = km² P4 = km² P5 = km² P6 = km² Shrimp Fishing Area Limit Bathymetry TOTAL iii iiii : km² Notes: i The conservation areas are identified by the number Major reduction in Sept Iles and Anticosti Both areas land large size shrimp Quebec also biggest seller of Canadian shrimp to US 50m Caraquet Îles de la Madeleine 450m 150m 150m of the corresponding significant coral and sponge area. ii The projection Canada Albers equal area conic (NAD83) was used to calculate the area sizes. iii Due to rounding, the total size differs slightly from the sum of the sizes of the individual areas. iiii The total size of the significant coral and sponge areas 300m takes into account areas of overlap, which are only counted once. 47 0'0"N New Brunswick Cheticamp km Approximate Scale 1: '0"N U.S.A Shediac 50m Prince Edward Island Nova Scotia Port Hawkesbury 50m 150m 100m 350m 150m 450m Produced by Fisheries Management - Quebec Region, Fisheries and Oceans Canada, Projection: NAD83, Lambert conformal conic Data sources: DFO, 2017 Disclaimers: This is not a navigation map and does not constitute a legal tool. Contents are subject to change and Fisheries and Oceans Canada cannot guarantee the accuracy of all the information presented in the map. Canada Fisheries and Oceans Canada Net result: higher prices for large size shrimp, less Canadian shrimp to the US in

11 West Coast and Oregon Supply West coast in low supply cycle Size trend may (??) be more favorable in 2018 Lower volumes mean less exports, more domestic shrimp market share going to US customers 11

12 US Coast wide historical landings and yearly avg price State Pink Shrimp Landings Calif Ore Wash Calif Price Ore Price Wash Price Metric tons 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5, $0.80 $0.70 $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 $- Pacfin Data 12

13 Prior Oregon declines in landings have not been reversed after 1-2 yrs Groth, S., M. Blume, K. Lawrence, J. Smith, and C. Good th Annual Pink Shrimp Review. 13

14 Summary Global landings stable for 2018 West Coast Landings likely similar or slightly improved from last year. Changes may occur in size distribution Less large size Pandalus from Canada Possible (??) improved size on US West Coast 14

15 Cooked and peeled coldwater shrimp prices rose in 2 nd half of 2017 Lowest pricing for the year was last spring, just prior to the 2017 season. Prices recovered from mid-year. But spread between smallest and largest size increased substantially. 15

16 Icelandic Prices to UK Show Recovery but weakness on smallest size $5.00 Iceland Double Fzn Price per Pound in UK $4.50 $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $- Seafood Datasearch Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan

17 US Imported P. borealis pricing Price spread has increased on larger sizes This trend may be more pronounced in

18 US has been the most consistent Market for Canada 3,500,000 Canadian Exports C&P by Country 3,000,000 2,500,000 Kilograms 2,000,000 1,500,000 1,000, ,000 0 UK US DK Other Europe Asia , Seafood Datasearch, Intracen 18

19 Total Canadian Exports Declining 6,000,000 Total Exports Declining as Landings Fall 5,000,000 4,000,000 3,000,000 2,000,000 1,000, , UK US DK Other Europe Asia Seafood Datasearch, Intracen 19

20 Canadian Exports by State 3,000,000 Canadian Exports by State Massachusetts California Florida Maine Virginia Michigan Others 2,500,000 2,000,000 pounds 1,500,000 1,000, , Reduction in Gulf will have impact in 2018 Seafood Datasearch, Intracen 20

21 Canada Main Export markets 6,000 Canada Exports $7.00 5,000 $6.00 4,000 3,000 $5.00 $4.00 $3.00 2,000 $2.00 1,000 $ United Kingdom United States of America Denmark Norway Sweden other UK Price US Price DK Price No Price Sw Price Other Price $- 21

22 New Brunswick exports Nb by Year New Brunswick US Sweden UK NB by ExportDestination New Brunswick ,400,000 1,200,000 1,200,000 1,000,000 1,000, , , , , , , , , US Sweden UK 22

23 Quebec Exports By Year Quebec Denmark United States Norway Switzerland United Kingdom By Destination Quebec ,500,000 3,000,000 2,000,000 2,500,000 2,000,000 1,500,000 1,500,000 1,000,000 1,000, , , Denmark United States Norway Switzerland United Kingdom 23

24 Newfoundland Exports By Year Newfoundland By Destination Newfoundland UK US DK Neth 5,000,000 4,500,000 4,500,000 4,000,000 4,000,000 3,500,000 3,500,000 3,000,000 3,000,000 2,500,000 2,000,000 2,500,000 2,000,000 1,500,000 1,500,000 1,000,000 1,000, , ,000 0 UK US DK Neth

25 Ex- Vessel Prices declined in 2017 $0.80 Pacfin Report on Shrimp Prices by State $0.70 $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 $ Pacfin data C O W 25

26 Newfoundland Inshore Prices Newfoundland inshore Prices spring summer fall $2.00 $1.80 $1.60 $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $

27 Size is important component of average price In 2017, market prices were lowest just at the time the new season was opening. Prices recovered in the 2 nd half of the year The smallest size shrimp had the greatest price weakness, and the slowest recovery For 2018 size will be the critical factor in determining value, as no significant market changes are expected. 27

28 Macro Factors for US Coldwater Shrimp Export markets will be less important for US producers More expensive Canadian shrimp will provide market opportunity for domestic shrimp. Size will still be a factor. Some users (especially of Canadian Shrimp) may drop sizes that are too expensive. 28

29 Macro Factors for Canadian Coldwater Shrimp Further declines in Landings will stabilize prices, ie they will not go down. Prices for larger shrimp may go higher, due to cutbacks in main supply areas. Market for offshore shrimp continues to be very strong; some smaller industrial shrimp now goes to Canadian plants. 29

30 US Market for Shrimp was very healthy in 2017 The overall US market for shrimp was very healthy in Shrimp continues to be one of the best values among seafood products saw record US imports of shrimp; consumption likely near record as well. Coldwater shrimp benefits from the overall buoyancy of this market. 30

31 Foodservice sales of all shrimp grew Seafood Datasearch: NFI Global Seafood Market Conf 31

32 Sales of Coldwater Shrimp Fell Industry reports suggest Foodservice volume fell around 9%; likely due to lower harvest. At the same time, prices rose over Coldwater share of foodservice shrimp could be as small as 0.4% 32

33 Retail sales of warm water shrimp increased Household penetration measures how many households make at least one grocery purchase of the product in a year. Rising household penetration indicates higher sales. Seafood Datasearch: NFI Global Seafood Market Conf 33

34 One factor was a shift from crab to shrimp at retail Seafood Datasearch: NFI Global Seafood Market Conf 34

35 Overall US shrimp imports grew to a record level Seafood Datasearch: US customs 35

36 Global warm water shrimp production will continue growing Seafood Datasearch: NFI Global Seafood Market Conf 36

37 Shrimp price volatility at a record low This makes it very difficult for shrimp importers to make money Seafood Datasearch and Urner Barry Publications 37

38 Margins are Squeezed for Headless shrimp Sales costs are closer to replacement costs Difference is shrinking Seafood Datasearch and Urner Barry Publications 38

39 Cooked and Peeled (Warm water) This is the same chart but for cooked and peeled shrimp show same pattern Margins are lowering here also Seafood Datasearch and Urner Barry Publications 39

40 Restaurant sentiment has been improving 40

41 Something will change in warm water shrimp market The volatility and margin charts show that something will have to change. Either overseas prices can decrease Or US prices can go up. But when this might happen, or what direction it might go, is unknown. My own feeling is that further growth in global supply will bring down prices. 41

42 Conclusions Stability appears to be the watch word for 2018 in shrimp. Both coldwater and warmwater shrimp outlooks do not show anything pushing for significant change. Challenge for 2018 will be to increase the value of coldwater shrimp within their category. 42

43 Thank you Time for Questions 43