US FDA import warning and ongoing supply shortages put China’s tilapia sector to the test

The U.S. Food and Drug Administration (FDA) issued a warning in May 2024 after imported tilapia produced by Hainan Eternal Springs Fisheries Co. was found to contain excessive levels of chloramphenicol, an antibiotic banned in China and normally used to treat bacterial infections.

This warning comes against a backdrop where the tilapia sector in China is already facing headwinds such as low export demand and higher input costs.

Chinese tilapia companies are banking on an expected recovery in export sales in 2024, but have stressed the need to sign larger contracts to counter pressure from tighter and more expensive raw material supplies.

Speaking to SeafoodSource at the Seafood Expo Global 2024 in Barcelona, ​​Spain, in late April, several Chinese tilapia companies, including a representative of Wenchang City-based Hainan Qinfu Foodwhich exports 40 percent of its production to the United States, reported difficulties in obtaining sufficient fish supplies, suggesting that Chinese farmers remain concerned about restocking their ponds after being disappointed by low producer prices for their fish in 2022 and 2023.

These low producer prices led farmers, faced with a weak export market, to either switch to species that were easier to sell domestically or, if they stayed until producer prices rose, to High feed prices and contract terminations by processors.

Although the industry has experienced cyclical declines in tilapia production in the past, some believe this time is different. Cui He, president of the China Aquatic Products Processing and Marketing Alliance (CAPPMA), said at a recent tilapia market conference in the southern Chinese city of Maoming that the growth of China’s tilapia production has slowed steadily over the past eight years.

“This is because the international market is saturated, international trade growth is weak and the acceptance of tilapia in the domestic market remains low,” he said.

Cui said he expects tilapia exports in Recovery in 2024 but said that further growth will depend on innovations in the domestic market, for example through Pre-packaged, pre-cooked meals and pre-prepared dishes for fast food, as well as…