SEAFOOD.COM NEWS — October 22, 2012 — Scallop market prices have been slowly declining in the U.S., where domestic IQF 20-30 count scallops have come down about 10% since January. However in other major markets, price declines have been stronger.
Urner Barry Scallop Pricing: This chart shows that prices have come down about 10% since January 2012. Prices have declined further in other markets.
According to local news reports from Yantai City, good growing conditions for scallops this year have led to a reduction in price. Recently in the local markets, scallops were selling for about 33% less than last year. This level of decline in the wholesale markets has been repeated across China.
For example, 78 cm diameter scallops that had been selling for 6 yuan per kg. are now at 4 yuan, and smaller scallops that had sold at 4 yuan last year were now at 2.5 yuan per kg.
According to local market participants, last year some deliveries failed to make it to the port city; this year there seems to be 'a more adequate supply and the price is cheaper than last year.'
The factors pushing prices down are a reduction in demand for exports due to economic conditions, a strong Japanese harvest and a resulting decline in scallop prices in Japan, and a strong Chinese domestic harvest.
There are still substantial price differentials due to quality and size, but in Japan, a single prices is available for scallops sizes 2S to 5S, generally signaling a soft market as larger scallops cannot get a premium.
Recently we ran a video report about the reduction in imports of Chinese scallops to the US. This may have been attributable to weaker demand, and the strengthening of the Chinese currency, which makes exports less attractive. But the export situation may be reversing.
Given the substantial price decline in the Chinese market the relative attraction of the export market may improve in the coming months, and a resurgence of Chinese scallop imports should not be discounted. We expect to see active interest in buying Chinese scallops at the upcoming China Fisheries and Seafood Expo in Dalian.
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