Fish meal exports boom on sardine rush to Indian coasts amid global shortage

A sardine rush to Indian coasts since last year has raised the fortunes of the fish meal units that produce essential raw material for the aquaculture feed industry

Indian producers exported more volumes of sardine-based fish meal that fetched better prices, by cashing in on the global shortage of the product last year.

Fish meal is a product made from unused sea-caught fish and fish waste and goes into the making of fish and animal feed. With the growth of the aquaculture industry and its dominance in seafood exports, demand for fish meal has increased in the past few years. The meal made from sardines has higher oil content, making the feed nutrient-rich for the faster and better growth of fish.

Sardine being a cheaper and popular edible fish, its use for fish meal units had been limited due to shortages in the last few years. Sardines surged on Indian coasts, particularly in Kerala and Karnataka, after a gap of around three years in 2022.

As per the estimates of the Central Marine Fisheries Research Institute (CMFRI), the oil sardine landing stood at 251,257 tonnes last year. In the previous two years, sardine landings were between 80,000 and 90,000 tonnes. In 2019 and 2018, sardine landings were between 145,000 and 155,000 tonnes. It was in 2017 that last major haul of sardines happened when the catch went over 337,000 tonnes.

There are around 68 fish meal producing units spread mainly in Karnataka, Kerala, Tamil Nadu and Maharashtra with a combined output of around 300,000 tonnes per annum.

Peruvian exports decline

“There was a global shortage as fish meal volumes from Peru, the biggest producer, was down. So, we were able to export more at better prices of USD 1,500 per tonne compared to around USD 1,200 in the previous year. In FY23, the export doubled to 50 percent of production,’’ said Dawood Sait, president of the Indian Marine Ingredients Association.

Peru’s fish meal industry is mostly anchovy-based.

On the other hand, Indian fish meal industry depends on a variety of fish such as sardine, mackerel and scad apart from anchovy for production, Sait said.

Fish oil, a byproduct in fish meal production, also went at a higher price from India as its production in Peru was lower because of poor catch. “Fish oil fetched USD 4,000 to USD 6,000 per tonne in the world markets compared to USD 2,000 to USD 2,300 per tonne earlier,’’ he pointed out.

Booming export let fish meal units to purchase sardines at a better price from the fishermen. `

`The fishermen got around INR 40 per kg for their sardine catch. They used to get INR 15 to 20 per kg in the last few years. And this time the oil content, which used to be between 3-6 percent was higher at 10 per cent or more,’’ said George Lukose, a fishmeal industry consultant.

Boat operators also said the fish landings, particularly that of sardines, were higher last year.

“ The fishing inactivity during the first Covid-19 lockdown and the restricted fishing operations after that could be a reason for the higher catches,’’ said Joseph Xavier Kalappurakkal, general secretary of the All Kerala Fishing Boat Operators Association.

As the fish meal export increased, the domestic shrimp feed units had to shell out more to buy the raw material, which pushed up their cost of production.

“The fish meal prices last year ranged from INR 135 to 150 per kg, up by INR 30 to 40. The alternative was import, which was difficult because of duty and costly dollar. The fish meal shortage may persist as the coastal states will soon implement the annual fishing ban during monsoon,’’ said C R Rao, joint managing director of Avanti Feeds.

Demand outstrips supply

The feed industry has requested the government to impose duty or restrict fish meal export for the benefit of the local feed industry. Over the last decade, the rapid growth in aquaculture activities in the country has made India the second largest shrimp producer after Ecuador with an annual output over 900,000 tonnes. But the fishmeal industry in the country has not grown in tandem. The upshot is that fishmeal demand has outstripped supply.

The fishmeal industry is against curbs of export, especially the present moratorium on export by units since 2018. “ Fish meal production can be a huge money spinner for the country. China, a major consumer of fish meal, has got a taste of our sardine-based product and is now a regular buyer. If a smaller country like Peru with anchovy-based fish meal can be the top supplier, India with a bigger coastline and variety of fishes can do much better. The government should take steps to promote fish meal industry in a sustainable way,’’ Sait said.

Will sardine flow continue into Indian coasts this year? CMFRI scientists said they will be able assess this only by the second half of this year, when the catches swell.

They attributed decrease in sardine catches partly to the El Nino weather phenomenon associated with the warming of ocean surface temperatures in the Pacific Ocean. It may have caused a temperature disturbance in Indian waters, causing sardines to migrate away from the coast. They have returned a year after La Nina, the phenomenon that is the opposite of El Nino, set in. Even without EL Nino, the sardine depletion in the coasts can happen every few years, they said.

Source: Money Control