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Skipjack Price Reaches USD 1500 Psychological Barrier

Skipjack prices, CFR Bangkok, have reached USD 1.500 per M/T this week completing a “roller-coaster” year cycle, with prices for 1.8kg and UP reaching the top at USD 2.000 last June and dropping to USD 800 in December 2008.

What seemed to be a well balanced recovery during the first quarter of 2009 is now leading to a market scare over again high tuna prices in the near future. Three major factors currently contribute to that:

-      Lower catches in the Indian Ocean (IO) and Eastern Pacific Ocean (EPO) and piracy in the northern IO is driving Spanish and French purse-seiners to other areas of less tuna abundance. In addition, intensive FAD fishing in the EPO has affected the bigeye population, reducing catches of the species.  Both aspects have decreased the raw material supply from those areas;
-      Coinciding tuna fishing closures in the EPO and the Western Central Pacific Ocean (WCPO). This is an unprecedented event in the history of global tuna business, the two most abundant tuna fishing areas of the world will be providing a limited raw material supply for a period of two months starting next August.
-      Steady demand. Although the economic crisis is affecting demand from some markets like the Middle East and the United States – in general global demand remains fairly steady, fulfilling expectations that canned skipjack tuna is a crisis resistant product.
      
In Asia tuna deals are now being closed at USD 1.500 anticipating the possible price effect those three factors combined will bring for the coming weeks, considering a 3-4 weeks delivery schedule. Forward speculation however could also get out of hand and over-exaggerate some of these effects- not looking at the realistic cost levels of skipjack, but being dominated by the manipulations of some major market players.

For constant updates and the latest information on tuna prices, check Atuna.com homepage’s skipjack price graph and Atuna Price Reports videos.