Nile perch fillet exporters headed for a tough year

Exporters of Nile Perch fillets may face a difficult run this year when the US enforces a new farming Bill that stands to restrict imports of a rival fish species, Pangasius, into her domestic market.

Nile Perch and Pangasius products traditionally rival each other in international markets owing to a generalised classification as “white meat”.

This means that any variations in the market performance of either species impacts on the other.

Analysts at the Food and Agriculture Organisation (FAO) observed that the pending implementation of the Bill, this year would have major implications on Pangasius trade.

“In 2010 the US farming bill could change the situation dramatically for pangasius imports when it is released. This bill would identify pangasius as catfish and put it under the rather restrictive sanitary control of the US Department of Agriculture,” they said in a market report for March.

And in what is expected to hurt local Nile Perch exports, the analysts project that the expected restriction of Pangasius imports would have a spiral effect on other international fish markets such as the European one that are traditionally eyed by Kenya and other East African countries.

“It has still not been set in motion and the consequences remain uncertain at present. The Russian market is the other unknown entity, and should the major buyers decide not to purchase, as happened during 2009, these products will flood the Western European market, creating many problems for the industry,” FAO’s Helga Josupeit said.

Vietnamese Pangasius are already popular in Western European markets where its low price has been well accepted in the present economic situation.

Market statistics showed Spain and Germany have thus become the top two importers of the Vietnamese pangasius, expanding their imports by seven per cent and four per cent respectively in 2009.

Overall, EU imports of pangasius in 2009 were on a par with the 2008 imports.

In addition, the Vietnamese government is planning to invest heavily in pangasius farming.

Once the production from these investments comes on the market, the total annual production will be 1.6 million tonnes, which means some 600,000 tonnes of additional product could swamp the market and adversely affect the current strong price situation.

“The outlook is bleak, as it will take the resource quite some time to recover. Despite the weak supply, prices of Nile Perch are going down. This is mainly caused by the strong competition of pangasius fillets in the market,” FAO said in an outlook late last year.

Kenya and other East Africa countries mainly rely on Lake Victoria for fishing of Nile Perch even though the business has in the recent years come under pressure from dwindling supplies and weak prices in the international market.