BERGEN: The volumes of king and snow crab available out of Norway may be small, but there’s plenty of money to be made by those companies selling them, as demand from Asian markets heightens.
This was the verdict from Erlend Johnsen, sales executive with Honningsvag, Norway-based Cape Fish Sales, speaking at the shellfish session of the recent North Atlantic Seafood Forum.
In 2017 Cape Fish is looking to increase the proportion of its sales which go to South Korea live, as these come second only to domestic product when it comes to desirability. As a result, said Johnsen, the firm can get roughly twice as much for a live crab as it can for frozen sales.
The firm’s turnover in 2016 was around NOK 280 million ($32.5m), based on sales of 454 metric tons of live king crab, and 300t frozen, Jonhsen told Undercurrent News.
Live king crab sales rose from just 200t in 2015. South Korea is the main market for live crab, while Japan is the main one for frozen.
This turnover figure was up from NOK 200m in 2015, and it looks a fair bet the firm will be able to increase this again in 2017; firstly, because Cape Fish is looking to increase its live sales from the roughly 60% of overall landings, and secondly because crab prices in Asia are on the rise.
The company is best-established in South Korea, but this year is looking at sales to Japan too. At the end of December 2016 the Japan Times reported wholesale prices for imported crab to the country were up 30-50% y-o-y, with volumes dwindling since a crackdown on illegal Russian catches.
Before the crackdown, more than 50% of Russian crab distributed in Japan was poached, the site reported.
Cape Fish started out by exporting its live crab to Seoul, South Korea, where buyers would re-export it. The firm tried to convince its customer of the merits of marketing it as Norwegian, but to no avail, prompting Cape Fish to establish its own re-exporting hub in Seoul.
In 2016 it had been flying direct from a military airfield in Lakselv, northern Norway, but Russia has now closed its airways to this trade. In response Cape Fish is constructing a 40t-holding tank at Oslo airport, which will be one of the largest live tanks in the world, according to Johnsen.
Norway also has the significant advantage in selling to South Korea that its sales come with no import tax; Russia’s come with a 20% duty, he said.
Its snow crab quota is not yet set for 2017. With the above-mentioned (likely) drop in Canadian quota, and the IUU crackdown, Cape Fish notes there is a good chance prices will continue rising.
