Sea cucumber: $34/lb in the market, 60¢/lb to fishermen

Independent licensed owner-operators are encouraged to join SEA-NL here. These blog posts will be public for a limited time, before becoming exclusive to the membership. $34/lb is the value of Atlantic-wide exports of sea cucumber products to the United States so far this year.

60¢/lb is the 2021 price paid to NL harvesters for their sea cucumber.

Seems pretty lopsided.

However, $34/lb is for dried products (powder/capsules/dried form) vs the 60¢/lb for wet, fresh-from-the-sea product .

The FFAW says there is a 15 to 1 recovery rate (yield) of dried products to landed weight.

The info is included in a June 2nd written decision by the province’s fish price setting panel that set the 2021 sea cucumber price paid to NL harvesters at 60¢/lb …

PRICE SETTING PANEL 'SIGNIFICANTLY CHALLENGED'

NL harvesters were paid 60¢/lb for sea cucumber last year during the height of the pandemic, down from $80¢lb in 2019 (which is what the FFAW was after this time around in price negotiations).

The Association of Seafood Producers (ASP) argued the sea cucumber market is weak, with “significant buildup of inventory at their Newfoundland operations.”

But then the ASP provided zero proof.

Until this year, the fish price setting panel had never set the price of sea cucumber, and admitted from the get-go it was “significantly challenged.” In fact, it pretty much didn't have a clue.

These are exact quotes from the panel report:

1) “There is limited data on the industry, logistics, its products, and yields.

2) Export statistics and product categories are general and offer few specific product characteristics.

3) There is no market assessment from the Government or industry. The Department of Fisheries, Forestry and Agriculture is constrained by privacy legislation in providing much detailed information on product types or on the number of processors producing the various products.

4) Processors have the best understanding of the industry and markets but have not offered sufficient information to convey this to the Panel.”

DRAMATIC SHIFT IN MARKET

Export data reveals that NL processors export two types of product — dried sea cucumbers, and frozen whole sea cucumbers. In 2019, 98% of NL exports (by value) were to China, and 84% were in frozen form.

Then, in 2020, the market shifted dramatically, with exports of dried product to the U.S. accounting for 73% of the value, with most of the rest going to China in frozen form.

The may have had something to do with the challenges of a world-wide pandemic.

Or not …

OPPORTUNITY KNOCKING

When it comes to the relative profitability of dried vs. frozen sea cucumber products, the price setting panel had “no understanding.”

The panel also noted that none of the three Newfoundland sea cucumber processors are processing value-added powder/capsule products.

What’s that sound?

Opportunity knocking …

HARVESTERS LOSE OUT ON 10¢/LB AT VERY LEAST

The $34/lb value of Atlantic-wide sea cucumber exports so far this year is down dramatically from 2020, when the price hit $51.24/lb. Will the trend continue? The panel couldn’t say because it doesn’t have the market info.

The panel said it felt the “right” price for sea cucumber this year is in between the FFAW and ASP offers — 60¢/lb vs 80¢/lb.

In setting the price was set at the lower end, the one absolute certainty about 2021 price is that harvesters lose out 10¢/lb at the very least …

Ryan Cleary,

SEA-NL