Markets for African Tilapia Products and Impacts on Local Supplies

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Markets for African Tilapia Products and Impacts
on Local Supplies

• Kevin Fitzsimmons, Ph.D.
• Professor, University of Arizona
• PI Aquaculture CRSP
• Vice President, American Tilapia Association
• President, World Aquaculture Society
• Washington D.C.
• April 28, 2004

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Introduction

• Quick review of tilapia
• Explosion in tilapia trade
• The US and International Markets
• Value added products
• Opportunities to expand markets

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Tilapia production

• Currently second in volume to carps
• Prediction Tilapia will become most important
  aquaculture crop in this century
• Widest demand, no religious/cultural concerns,
  few environmental concerns
• More genetic potential
• Greatest variety of production systems

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Farmed around the world.

• Tilapia production in 100 countries.
• China is worlds largest producer.
• Philippines, Thailand, Indonesia, Latin America,
  Egypt significant producers
• Germany, Belgium, Spain, Canada, Korea, Japan,
  most states in US
• Total production gt1,500,000 mt in 2003

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Global Tilapia Sales (farmgate)

• For year 2000
• US 1,706,538,200 (FAO Fisheries Circular
  No. 886)
• 2003 sales gt 2,500,000,000

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Tilapia - the aquatic chicken

• Grows in all kinds of farms
• Eats all kinds of food
• Large eggs and easy to rear young
• Lots of ways to prepare the fish

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Ponds and cages
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Intensive tank culture
Tanks in Arizona
Tanks in Eritrea
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Raceway Systems
Intensive raceways
Extensive raceways
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Intensive farms in buildings in cool climates
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Intensive farms with recirculation in greenhouses
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Integrated with crop irrigation
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How did tilapia get so popular, so fast?
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Tilapia - the Perfect Aquaculture Storm
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Tilapia widely popular around the world and
beyond.

• Common names Tilapia, chambo, boulti, lou fei,
  pla nil, St. Peters fish, mojara, freshwater
  and/or red snapper
• Used in many cuisine, hundreds of recipes, often
  replaces over-fished local species
• Eggs hatched and fry reared on International
  Space Station

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Established market demand

• Accepted in many national dishes
• Popular in many forms (live, whole, fillets,
  fresh and frozen, smoked, sashimi, fried skins)

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Environmentally correct

• Primarily vegetarian
• Most farm systems cause little pollution
• Tilapia were long ago established as exotic
  species, common food fish
• Grown mostly in developing countries
• Few diseases, essentially no chemicals used

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Research Development ISTA 6(Manila,
Philippines, Sept 12 -16, 2004)

• International Symposia on Tilapia in Aquaculture

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Genetic Improvements in Tilapia
(From Mair, G., 2002)
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The YY male technology
(GMT)
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Major Tilapia Producers (for year 2002)

• China - 706,000 metric tons / year
• Philippines - 122,277 mt / year
• Mexico - 110,000 mt / year
• Thailand - 100,000 mt / year
• Taiwan Province - 90,000 mt / year
• Brasil - 75,000 mt / year
• Indonesia - 50,000 mt / year

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Major African Tilapia Producers (for year 2002)

• Egypt - 55,000 metric tons / year
• Zimbabwe - 5,000 mt / year
• Kenya - 2,000 mt / year
• Zambia - 1,000 mt / year
• South Africa - 1,000 mt / year

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Commercial tilapia farms in Africa
Army Farmnear Abassa, Egypt
Dominion GroupRice/Tilapia farm near Kisumu,
Kenya
Farmers Co-op on Lake KaribaZambia
Lake Harvest onLake Kariba, Zimbabwe
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Tilapia research centers in Africa
Abassa, Egypt
Massawa, Eritrea
Boake, Cote D Ivoire
Sagana and Eldoret, Kenya
Zomba, Malawi
Stellenbosch, South Africa
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Cages in Egypt
10 m2 cages near Alexandria
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SeaWater Farms, Massawa, Eritrea
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Lake Harvest, Zimbabwe
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Lake Harvest, Zimbabwe
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Lake Harvest, Zimbabwe
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EU Tilapia Supply and Demand

• Supply of fillets primarily from China, Southeast
  Asia, South and Central America.
• Demand for live fish in immigrant Asian and
  African communities
• With rapid increases in supply, demand must
  increase at least as fast to support price.

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Consumer evolution

• Ethnic buyers (Asian - African)
• Up-scale restaurants
• Casual dining
• Hyper and super markets
• Local groceries

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US Tilapia consumption - 2003(187,000 mt of live
weight 412,260,000 lbs)
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Top Ten Seafoods (U.S.)per capita (lbs)
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US. Tilapia imports 1993-2002
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174,215,165 (2002) 241,205,610 (2003)
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17,952 mt fresh fillets, 23,249 mt frozen
fillets, 49,045 mt whole frozen (2003)
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US Consumption of tilapia

• Imports in 2003 were 241,205,610
• US production of 30,000,000 at farm
• 2003 sales were over 271,000,000
• 1994 - 2003 US tilapia sales (imports and
  domestic) exceeded one billion

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Major fresh fillet buyers (US)

• Major restaurant chains (Darden Red Lobster,
  Bahama Breeze, Olive Garden, Landrys Joes
  CrabShack, Wille Gs, Rainforest Cafe), Ruby
  Tuesday, Applebees).
• Major grocery chains (Safeway, Kroger,
  Winn-Dixie, Wegmans, Publix, Bashas)
• Food service (supply small restaurant grocery
  chains) - SYSCO, Fleming Co., Shamrock
• Brokers - most based in Miami, Tampa, Houston,
  Los Angeles, San Francisco, New York, Seattle

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Fresh tilapia fillet products

• Size (under 3 oz, lt 85 g) 3-5 oz, 85 -
  140 g 4-6 oz, 110 - 170 g 5-7 oz,
  140 - 195 g over 7 oz, gt 195 g
• Skin on, shallow skin or deep skin
• Individual wrap, 2 or 5 kg package, master pack

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Fresh tilapia fillet product pricesFOB Miami

• Size (under 3 oz, lt 85 g) 2.80 - 3.00/lb 3-5
  oz, 85 - 140 g 3.00 - 3.10/lb4-6 oz, 110 -
  170 g 3.10 - 3.25/lb5-7 oz, 140 - 195 g
  3.15 - 3.40/lbover 7 oz, gt 195 g 3.35 -
  3.55/lb
• Variation in prices due to skinning, packaging,
  volumes and history with buyer
• Additional variations with terms of payment

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Expanding European markets

• Quality control and assurance
• Advertising
• New recipes
• Substitute for sea bream, sea bass, flounder,
  snapper
• New value added product forms

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Quality control and assurance

• National standards
• ISO and HACCP (Hazard Analysis at Critical
  Control Points)
• Industry standards
• Buyer standards
• Other (NGOs)

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Advertising
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Direct retail sales
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New recipes
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New recipes
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By-products

• Leather goods from skin will become a significant
  contributor to profitability
• Pharmaceuticals from skins
• Formed fish products
• Fertilizer
• Fish meal

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Major Tilapia Producers in International Trade

• China - whole frozen, IQF fillets
• Ecuador - fresh fillets
• Taiwan - whole, IQF, sashimi
• South Central America - fresh fillets
• Zimbabwe - Fresh fillets
• Indonesia - IQF fillets
• Thailand - IQF fillets

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Current EU Market Trends

• Increase in demand for all forms of tilapia
• Demand increase will be greatest for fresh
  fillets
• Prices have been constant for several years and
  will remain stable, will not increase with
  inflation

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African Markets

• Local production and consumption
• Majority stays in producing household
• Egypt has market development, but little
  processing capacity
• Rest of Africa needs more processing

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Impacts of Industrial Production of Tilapia

• Spin-off some products into local markets
• Availability of prepared feeds
• Availability of domesticated stocks
• Possibility of more production cooperatives

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Changes and Predictions

• Production will be 75 Oreochromis niloticus, 20
  Red strains, O. aureus and O. mossambicus mostly
  for hybridization

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Changes and Predictions

• Production will be 50 intensive ponds, 30
  cages, 10 intensive recirculating and tank
  systems, 10 other

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Predictions for Value-added products

• Processing and "value-adding" will intensify in
  producing countries

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Sashimi
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IQF Fillets
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Breaded tilapia products
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Fried tilapia skins
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Smoked products
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Changes and Predictions

• More organic forms
• Reduction in MT for sex reversal

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Changes and Predictions

• World tilapia production (1,265,780 mt in 2000,
  FAO) reached 1,500,000 mt in 2003 and 2,000,000
  mt by 2010
• 2003 sales over 2 billion
• 2010 sales over 4 billion

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Aquaculture Collaborative Research Support
ProgramThank you!Questions?

• The Aquaculture CRSP is funded in part by United
  States Agency for International
• Development (USAID) Grant No. LAG-G-00-96-90015-00
  and by participating institutions.

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Tilapia production in the Americas
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Strain evaluations

• For saline waters - Hybrid red strains are
  preferred
• For cage and pond culture Chitralada strain of O.
  niloticus originally from Thailand and further
  developed in Brasil.
• The GIFT strain of O. niloticus, originally
  developed in Philippines is most common in
  Philippines and China
• YY Super males - Genetically Male Tilapia

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Estimated cost of production

• China - 0.70/kg
• Africa - 0.75/kg
• Philippines, Indonesia, Brasil - 0.80/kg
• Thailand, Peru - 0.85/kg
• Ecuador, Honduras, Costa Rica - 0.90/kg
• Mexico - 1.00/kg
• Taiwan Province - 1.05/kg
• US - 2.00/kg
• Canada - 2.10/kg