Exploratory fishing has begun in the south of Peru but this past week has been off and on due to the very high percentage of juvenile fish – up as high as 48% in one area. 48 hour fishing bans have been put in place in the worst affected areas.
It has been very interesting to see reports in the financial press of how well fishing/fishmeal companies in Peru have done in the last financial year. Overall it looks like the short fishmeal quota did not have too serious an effect, if any, on fishing organizations that are diversified across the fishing industry. Even some companies that are quite dependent on fishmeal had a good year in 2014. It seems that they are now much better able to handle the very large ups and downs of the industry and the quotas.
Much of the talk in Peru has now moved to prices and what will happen with the very high current market priced when Peru has new supply to sell. One would expect that there is going to need to be a major correction in prices but how much will that be USD 200 to 300 m/t lower, perhaps more.
Needless to say, anyone with fishmeal to sell today is going to keep selling at these very high prices until some new Peru production is about to come to market……fishmeal producers outside of Peru have done very well over the past few months with profit margins one can only dream about.
Looking at the major northern fishing quota in Peru, there continues to be a very wide spread in the estimates of the size of the quota but more and more experts seem to be leaning toward the 2 million to 2.5 million m/t level.
On last word on prices – the indication prices below show a drop from last week and might just represent the first steps to lower producers prices in Peru.