(SeafoodSource) With European cod stocks at unprecedented levels and quotas set to soar over the next few years, there’s heavy pressure on exporters to find new markets for the additional fish or see prices slide further toward unprofitability. In traditional cod markets, however, it’s the producers of other whitefish products that should expect to lose the most ground.
For the Barents Sea, the world’s largest cod fishery, the International Council for Exploration of the Sea (ICES) has recommended a 25 percent hike in the 2013 quota, which would take the total cod catch up to a record high of 940,000 metric tons, compared with 740,000 metric tons in 2012.
Cod supplies from Iceland are also set to increase in line with a much-improved spawning stock. The country’s Marine Research Institute (MRI) has recommended that the government increase the quota for the year starting 1 September, 2012, to 196,000 metric tons, an 22.5 percent increase from the current season.
The MRI has further suggested that Iceland’s quota could reach 250,000 metric tons by 2016.
Also moving in the right direction, ICES has said North Sea cod stocks are now at their healthiest level in 14 years, doubling in the last six years. While fishing opportunities in the North Sea recovery zone could yet reduce further, the industry remains optimistic that the positive turnaround points to larger quotas in the future.
The proposed catch increases are certainly a well-deserved pat on the back for fisheries management, but exporters are fearful of the effects that the significantly greater supply will have on prices and subsequently their bottom lines. And their worries are not without reason: the current price of H&G cod in China stands at about USD 3,100 (EUR 2,542) per metric ton, whereas 18 months ago it was USD 5,500 (EUR 4,510).
John Rutherford, director of the Frozen at Sea Fillets Association (FASFA), which represents trawler owners and distributors of frozen-at-sea (FAS) fish from Norway, Iceland, Faroe Islands, Spain, Russia, Greenland and the United Kingdom, believes that if cod prices continue to fall it’s plausible some of the quota will remain uncaught in the sea.
“The economics have to work both for the catchers and for the consumers,” he said. “Some companies will take full advantage of the quota but I can see others saying, ‘Why should we work harder for no more money?’ There must be a floor in the price, below which the catchers simply won’t go to sea.”
In Norway, the 8 percent increase in the Barents Sea cod quota for the current season has contributed to a decrease in the export value of the country’s groundfish for the first-half of 2012. According to the Norwegian Seafood Council (NSC), groundfish exports totaled NOK 5.1 billion (EUR 685.9 million, USD 837 million) for the six-month period, representing a NOK 356 million (EUR 47.9 million, USD 58.4 million) drop, or 7 percent compared to the first half of 2011.