Stable squid supply - shrinking costs

By Sean Roach

- Last updated on GMT

The world squid market shows landmark demand for cephalopods, but
increased catch-rates have driven the overall cost of squid down,
says a report published last month.

While markets in the US and Spain have increased their imports recently, the price of squid is falling because supply and catch rates are outpacing overall growth in the market, according to Globefish, the Food and Agriculture (FAO) unit devoted to the seafood industry.

Catch increases are largely due to the flourishing South West Atlantic region, where Argentina-based fisheries have improved on last years catch by 22 tonnes thus far. According to the Agriculture, Livestock, Fisheries, and Food (SAGP&A) Secretariat, 178,300 tonnes of squid were landed during the first four months of 2006 in Argentinewaters.

Spanish fleets and markets have been most affected by the positive growth in the South West Atlantic. Spanish imports grew by 40 per cent in the first four months of 2006. The massive increase is due to Spanish fleets harvesting Illex and Liligo species in Argentine waters. These companies are dominating the Spanish market, but have also contributed to a decline in squid value in view of strong arrivals.

Spanish producers are also benefiting from increased demand in the Italian market, where import hikes are mirroring their Spanish neighbours. The Italian market hit a record level of imports bumping up against the 100 000 tonne mark and is expected to increase until the end of the summer period, said Globefish.

On the other side of the globe, Japan, one of the world's largest seafood consumers, had increased their import rate of squid. This trend is surprising because the country largely harvests their supply from their own waters. The import demand is expected to exceed the 65,000 tonne precedent set in 2005.

Japan produces about 250 000 tonnes of the flying squid species per year and imports are usually from Chinese or Vietnamese fleets that operate in Japanese waters.

Globefish has yet to record the impact of the flying squid market in Japan because the season starts during the summer months. However, it is expected that a high-catch, coupled with the increases already seen in the South West Atlantic, will drive the cost of squid down in Japan.

The US market is also beginning to acquire a taste for squid, increasing their demand slightly in the early stages of 2006. Imports largely come from China, which has harnessed the US interest in value-added squid products for the ethnic market. The US market has been experiencing year-on-year increases in imports and demand is expected to rise, said the report.

Globefish expects that the prices of common squid will remain stable although price levels of squid coming from South Africa showed a slight decline in 2006.

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