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Trident’s China office is always involving and keeping the pace with the market. The mission is to fully service the market. Trident has said from the beginning: “We are in this business for the long haul.” Nothing has changed.

The main ground share of species in China is Pollock, Cod, Haddock and Hake. Over 70% of groundfish imports are Pollock, and almost all of that is Russian HG. Nearly all the volume in all 4 species is HG or whole round. Note how dependent HG and double frozen markets are on China’s infrastructure, regardless of the species. More than half of the export volume goes to Europe. Europe depends heavily on China for value and volume. Over 60% of exports are Pollock. Of imported groundfish species to China, 65% are Pollock and nearly all of it imported by Russian agencies. More than half of the exported volume goes to Europe, which depends heavily on China for value and volume, and over 60% of these exports are Pollock.

The domestic market is hard to quantify but converting exports back to HG gets us a fair comparison year-to-year of the export market as a percentage. A lot more fish is staying in China for consumption, driven almost exclusively by pollock. While it appears 2017 consumption slowed, the entire perceived increase in exports (in green) from 2016 to 2017 is an additional 25,000 tons of pollock HG and whole round going from China to North Korea.

More than 98% of pollock imports go to Dalian and Qingdao, focusing there, we’ve proportionally added the China customs data for 2018-2019. This second visual is strictly exports of pollock, and here you can see the impact of:

• Brazil’s restrictions on Chinese double frozen product,
• The trade war with the US,
• The early 2019 material shortage in Europe, and market changes in Russia, Japan, and Korea.
• After Europe, the rest of the world is a distant second market.

Reputation: You will find the full spectrum of quality, safety and social responsibility in China, from the very best to the worst. At the same time, we have experienced both much consolidation and disruption in the China market in the last 5 years with new leaders in the market. The government has increased government regulation, to tightened financial access, to a disconnect between raw material and finished product prices. Combined with price pressure, there are new significant risk factors including forbidden labour sources. When comes to the supply chain: The global trading networks is so opaque, those selling or using the resulting product may not even know they have compromised links in the chain. Paper alone does not cover these supply chain holes.

The bright spot is economic development: Groundfish, especially Pollock, is showing up throughout the domestic market. HG is sold at wet markets throughout the country now. Dried Pollock is a traditional staple that is evolving towards modern convenience. Pollock shows up on local menus and at summer beachside barbecues through “Developing foodservice channel”. China is a huge surimi market and though it’s mostly freshwater and tropical so far, there’s more groundfish showing up in this market too. In this steamed dumpling the actual bun is Pollock surimi. There’s Pollock roe and flying fish roe inside.

Surimi and dried trends extend into snacks and convenience stores. There are over 100,000 convenience stores in China. More Japanese-style products and just-in-time supply mean there are also perishable fish products on the shelves. Costco arrived in Shanghai in August 2019, and Sam’s was already aggressively expanding their most successful global market in anticipation. Both stores shelve dozens of groundfish products like Alaskan Cod and Wild Alaska Pollock Burgers. The most marketed consumption is in chain restaurants, both homegrown and foreign. The surprise success of fast food delivery in cities has a major chain claiming more than half their sales in first-tier markets are delivery.

With US imports hobbled, demand created by US companies has been filled by other sources. Examples Lobster, shellfish, single-frozen Wild Alaskan Pollock. A weakened currency means exports have stayed competitive in spite of tariffs. What really keeps exports competitive is that there’s no single replacement for the capacity and efficiency of Chinese reprocessing yet and cost-neutral processing technology is still a way’s out.

China still a huge and necessary opportunity, both as a market and as a resource. It’s a market that has been crowded with big ideas for years. With all the turbulence inside and surrounding China, companies and industry need even more thoughtful approaches to a market that has grown even more diverse, visible, and risky. As an industry, our growing participation in China is inevitable, and our respect and understanding of the market are critical.