Fish oil prices jump up, following difficult anchovy season in Peru
Peruvian fish oil prices have rebounded in recent months, driven by lower yields in the first anchovy fishing season in the north-center of Peru last year and scarce catches during the second fishing season, sources told Undercurrent News.
Fish oil prices have risen to up to $2,600-2,800 per metric ton, while fishmeal prices rose to $1,900/t, sources in Peru told Undercurrent last month.
Not many deals have been executed in recent months, however, as fishmeal and fish oil producers had partially already pre-sold their fishmeal and oil production for the last season and total supply was much less than expected.
According to one European source, fish oil prices have remained virtually static since September, at around $1,800-2,000/t, essentially due to the lack of closure of new contracts.
"Probably anyone with oil with the right profile, or with the content EPA or DHA requested by customers, would today tear up higher prices. But it is impossible to know at what level precisely because there is no availability," the source noted.
Long chain omega-3s such as DHA (docosahexaenoic acid) and EPA (eicosapentaenoic acid) are critical inputs used extensively in aquaculture feed, with fish oil and fishmeal as their main sources.
Prices of oil for indirect human consumption, a category that includes aquaculture, rebounded last July, following a decrease, and continued to gradually rise throughout 2017, sources said.
The demand for fish oil from aquaculture continues to be strong, Enrico Bachis, chief analyst with IFFO, the marine ingredients organization, told Undercurrent.
Demand from the pharmaceutical industry is also strong, given that stocks that had been accumulated in past years to cope with lower Peruvian and global supply, have been exhausted, Bachis also said.
The demand for omega-3 supplements continues to be stable, although the exponential growth outlook expected two to three years ago might not materialize, according to Bachis. He pointed out that "at most there will be a small growth in the world stimulated essentially by Asia", adding: "Whatever will be produced in Peru will therefore find a buyer".
Last year, the anchovy fat percentage, which determines the amount of fish oil that can be produced decreased to about 3%, according to some sources.
At the moment, expectations are negative since a large presence of juveniles in the total biomass of anchovy means fish with low lipid content and therefore with potential very low oil yields.
However, a forthcoming report from Peru's marine institute, IMARPE, might show a different scenario, potentially leading to more positive expectations, according to sources.
In normal fishing conditions, fish oil prices should drop back to around $1,800/t, according to a source at a large Peruvian processor.
Despite a November report from IMARPE that indicated a high presence of juveniles and the bad results of the last fishing season in the north-center region of Peru, local fishmeal producers expect strong anchovy catches later this year.
According to Chile's central bank, fishmeal prices were $1,560/t in November 2017, $1,787.50/t in December 2017, $1,922/t in January 2018 and $2,003.33/t in February 2018.
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