US & International Trade in Tilapia products: 2003 and Beyond Kevin Fitzsimmons University of Arizona American Tilapia Association International West Coast.

US & International Trade in Tilapia products: 2003 and

Beyond

Kevin FitzsimmonsUniversity of Arizona

American Tilapia Association

International West Coast Seafood Show

Los Angeles, CA

November 4, 2002

Introduction

Review worldwide tilapia productionExamine production costsExamine current tilapia markets Discuss problems of supply and demandOpportunities to expand productionOpportunities to expand markets

Production widely distributed around the world.

Tilapia production in 100+ countries.China is world’s largest producer.Philippines, Thailand, Indonesia, Latin

America, Middle East significant producersGermany, Belgium, Spain, Canada, Korea,

Japan, most states in USTotal production of 1,344,000 mt in 2001

Tilapia widely popular around the world.

Used in many cuisine, hundreds of recipes

Tilapia, boulti, lou fei, pla nil, mojara, St. Peters fish, freshwater and/or red snapper

Established market demandAccepted in many national dishesPopular in many forms (live,

whole, fillets, fresh and frozen, smoked, sashimi, fried skins)

Problem areas in tilapia production

Low fillet recovery rateSlow growing femalesOff-flavors

Advances and Solutions: Low fillet recovery rate

Selective breeding programsTransgenics - Growth hormonesGrowth enhancers - Bovine

SomatotropinsBetter processing equipment

Advances and Solutions: Slow growing females

Methyltestosterone for sex-reversalGenetically male tilapia All male hybridsHigh density cultureO. niloticus with larger females

Advances and Solutions: Off-flavors

Depuration systemsControl of blue-green algaeProduction in systems with limited

access to benthic algae

World Tilapia Production in 2001

China46%

Taiwan Prov.7%

Philippines7%

Thailand7%

Mexico7%

Others4%

Indonesia4%

Costa Rica1%

Colombia2%

United States1%

Brasil5%

Egypt4%

Cuba3%

Ecuador2%

Major Tilapia Producers (for year 2000)

China - 629,182 metric tons / yearMexico - 102,000 mt / yearThailand - 100,000 mt / yearPhilippines - 92,284 mt / yearTaiwan Province - 85,000 mt / yearIndonesia - 50,000 mt / yearBrazil - 55,000 mt / year

Basic Chinese model Government organized or approved hatcheries Small to medium size farms, extension support

from state hatcheries Tilapia fed pelleted feeds Many fish sold live to local restaurants Large scale processing plants International trade is mostly frozen products

(fillets and whole)

Typical Chinese Farms0.2 to 1.0 hectare

pondsOften polyculture

with other fishSometimes have

single aeratorFamily operatedSell to harvester

Carbon monoxide Most plants appear to

use carbon monoxide Some gas in chambers

others infuse in bags before freezing

Bagging individual fillets

IQF Fillets

Boxed with retailer labels US and European

markets Boxed with frozen

fillets or whole fish

Many different labels

Tilapia from China is arriving in US and EU with many different labels and packages

Marketing in China

Most fish sold locally to restaurants

Just beginning advertising

Suggest product placement, inclusion in government food programs, value added for domestic markets

Chinese markets and recipes

Market in China is still limited - less than 2 kg per capita

Need to develop additional recipes

Improve overall recognition of tilapia as premium fish

More red strains, seawater culture

Thailand - 100,000 mt Many small producers Mostly pond production Fertilized and pellet fed Some vertically integrated growers developing C.P. Group developing contract grower

network C.P. pushing “Top Tim” brand of red tilapia

Philippines - 95,000 mt

Cages in Irrigation Reservoirs100 m2 cages in Philippines

Tilapia - shrimp polyculture

Direct retail sales

Philippines - Strong domestic demand

Early introduction of tilapia Center of research and development Developed tilapia-shrimp polyculture

system

Mexico - 102,000 mtTilapia-shrimp farm in Sonora

Pond Tilapia farm in Tamaulipas

Tilapia production in Mexico

Production in most states of Mexico Most production in southern states Intensive in north, lake ranching in south Repopulation of reservoirs Problem with FAO definition of

aquaculture Tilapia-shrimp polyculture in seawater

Markets in Mexico

Strong domestic markets; on ice, fillets in grocery stores

All domestic consumption - Will eventually develop export markets.

Raceway system

Brazil - 65,000 mt

Tilapia production & Markets in Brasil

Production in Southeast and NortheastRed tilapia in Southeast for fee-fishing

and foodCage farms allowed in NE reservoirs.Tilapia leather industryJump in interest with ISTA 5 in Rio.Developing export markets.

Egypt - 53,000 mt10 m2 cages near Alexandria

Egypt and other Middle East Egypt - Production in cages, polyculture

ponds and rice paddies. Israel - Intensive, center of research and

technology transfer Saudi Arabia - Intensive with crop

irrigation Jordan - Intensive

Ecuador - 25,000 mtTILAPIA PRODUCTION IN ECUADOR

0

5,000

10,000

15,000

20,000

25,000

30,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Year

Pro

du

ctio

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mt)

Tilapia production in EcuadorReplacing shrimp because of white

spot and other shrimp diseasesUsing shrimp infrastructureExporting to US and EUBenefits to shrimp culture with

polyculture

Costa Rica - 15,000 mtAcuacorporacion ponds in Cañas, Costa Rica

Jamaica - 5,200 mtTilapia production 1980-2001

0

1000

2000

3000

4000

5000

6000

80 82 84 86 88 90 92 94 96 98 2000 2001

Year

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es

Aquaculture Jamaica Limited - Barton Isle Farm

USA - 9,200 mt

Production in many states Mostly intensive systems, many

recirculating Sales to ethnic markets as live fish, high

value

Tilapia Production in the US = Live Sales

USA - Ponds and cages

Raceway Systems

Intensive raceways

Extensive raceways

Intensive tanks

Tanks in Arizona

Tanks in California

Intensive farms in New York and Iowa, USA

Intensive farm in Iowa, USA

US Tilapia consumption - 2001(104,626 mt of live weight)

0

20,000

40,000

60,000

80,000

100,000

120,000

Met

ric

tons

1986

1987

1988

1989

1990

1991

1992

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1995

1996

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1998

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2001

US Tilapia Supply in 2001 (by volume)US9%

OTHER3%

CHINA19%

JAMAICA0%

INDONESIA6%

TAIWAN Prov.35%

ECUADOR15%

HONDURAS 4%

COSTA RICA9%

US. Tilapia imports 1993-2001

Sources of imported tilapia to US

0

20000

40000

60000

80000

100000

120000

1993 1994 1995 1996 1997 1998 1999 2000 2001

(LW

E in

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others

Thailand

Indonesia

Colombia

China

Mexico

Jamaica

Ecuador

Costa Rica

Taiw an

Figure 2. Value of Tilapia products imported to the U.S. in 2001

Fillet Fresh

Fillet Frozen

Whole Frozen

$0

$20,000,000

$40,000,000

$60,000,000

$80,000,000

$100,000,000

$120,000,000

$140,000,000

1993 1994 1995 1996 1997 1998 1999 2000 2001

$ U

S

Whole Frozen

Fillet Frozen

Fillet Fresh

$127,796,540

Typical prices for Tilapia products sold in the U.S. (Sept. 2002.)

Pond-side/Processor

$/kg

Wholesale$/kg

Retail$/kg

Whole live fish 2.20 - 6.60 2.80 - 7.50 4.00 - 10.00Whole frozenfish

1.10 - 2.00 2.00 - 2.35 2.20 - 5.00

Whole freshfish

2.30 - 3.00 3.00 - 4.00 4.00 - 9.00

Fillets, fresh 5.00 - 7.00 6.00 - 8.00 8.00 - 12.00Fillets, frozen 4.80 - 6.75 5.50 - 7.80 7.00 - 11.50

International Supply and Demand

Supply primarily from China, Southeast Asia, Ecuador and Central America.

Demand is in producer countries and US, and increasingly EU

With rapid increases in supply, demand must increase at least as fast to support price.

Major Tilapia Producers in International Trade

China - whole frozen, IQF filletsEcuador - fresh filletsTaiwan Prov. - whole, IQF, sashimiCentral America - fresh filletsIndonesia - IQF filletsThailand - IQF fillets

Estimated cost of productionChina - $0.70/kgPhilippines, Indonesia - $0.80/kgBrazil, Ecuador, Thailand - $0.85/kgHonduras, Costa Rica - $0.90/kgMexico - $1.00/kgTaiwan Province - $1.05/kgUS - $2.00/kgCanada - $2.10/kg

Current International Market Trends

Increase in demand for all forms of tilapia

Demand increase will be greatest for fresh fillets

Prices have been constant for several years and will remain stable, will not increase with inflation.

Current International Market TrendsChina will remain the world’s largest

producer and consumer.US and EU growers will focus on live

sales and highly processed formsAsia and Latin America and will be

primary US suppliers Latin America, Caribbean and Africa will

supply EU

International marketing

World market is huge

Need to invest in market development (as we are doing today)

Pay for generic marketing

Packaging and Delivery

Packaging and Delivery

Red strains of tilapia

New recipes

New recipes

Sashimi

Fried tilapia skins

www.tilapia.org

Dear Kevin, I recently began using Tilapia fillets farm raised by Sea

Best and distributed by Beaver Street Fisheries, Inc. I buy these in individual vacuum sealed packages in one pound bags at Wal-Mart in San Marcos, Texas. My husband has diabetes and we both are very weight conscious. This fish is the perfect food item for us, I love the way it is packaged, just use what I need for one meal, it is reasonably priced, always available in the market and consistently high quality. I trust you will forward these comments to the producer.

I LOVE THE PRODUCT!!!! Marian Birnie Aug. 12, 2001

Changes and Predictions

Further intensification in virtually every country

Production will be 75% Oreochromis niloticus, 20% Red strains, O. aureus and O. mossambicus mostly for hybridization

Production will be 50% intensive ponds, 25% cages, 10% intensive recirculating systems

Changes and Predictions Further intensification in virtually every country

Production will be 75% Oreochromis niloticus, 20% Red strains, O. aureus and O. mossambicus mostly for hybridization

Production will be 50% intensive ponds, 25% cages, 10% intensive recirculating systems

Changes and Predictions Further intensification in virtually every country Production will be 75% Oreochromis niloticus, 20% Red

strains, O. aureus and O. mossambicus mostly for hybridization

Production will be 50% intensive ponds, 25% cages, 10% intensive recirculating systems

Changes and Predictions

Leather goods from skin will become a significant contributor to profitability

Processing and "value-adding" will intensify in producing

countries Polyculture with shrimp will become common in most

shrimp farming areas

Changes and Predictions Leather goods from skin will become a significant

contributor to profitability

Processing and "value-adding" will intensify in producing countries

Polyculture with shrimp will become common in most shrimp farming areas

Changes and Predictions Leather goods from skin will become a significant contributor to

profitability

Processing and "value-adding" will intensify in producing

countries Polyculture with shrimp will

become common in most shrimp farming areas (already practiced in Thailand, Philippines, Mexico, US, Ecuador, Peru, Eritrea)

Changes and Predictions

US production will increase slowly, intensifying current production methods

Changes and Predictions US production will increase slowly, intensifying current

production methods

World tilapia production will reach 1,400,000 mt in 2002 and 2,000,000 mt by 2010

Conclusions - Marketing tilapia

Increasing demand / markets should begin in producing country

Opening new markets will be required in China, Philippines, Japan, Korea and US

Many techniques can be used to build markets Many are free or low cost (product

placement, samples, live tanks, Web sites) Most effective forms require investment

Thanks to: Mr. Howard Johnson West Coast Seafood Show

Questions ???