A sardine rush along the coasts of India since last year has boosted the fortunes of fishmeal factories, which produce key raw materials for the aquaculture feed industry.
Indian producers exported more volumes of sardine-based fishmeal and fetched better prices, benefiting from global shortages of the product last year.
Fishmeal is a product made from unused marine fish and fish waste, used in the manufacture of fish and animal feed. With the growth of the aquaculture industry and its dominance in seafood exports, the demand for fishmeal has increased in recent years. The meal made from sardines has a higher oil content, which makes the feed more nutritious and allows the fish to grow faster and better.
Because sardines are a cheaper and popular food fish, their use for fishmeal units has been limited due to shortages in recent years. After a pause of about three years in 2022, sardines began to pick up again along the coasts of India, particularly in Kerala and Karnataka.
The Central Marine Fisheries Research Institute (CMFRI) estimates that 251,257 tonnes of oil sardines were landed last year. In the last two years, the sardine landings have been between 80,000 and 90,000 tons. In 2019 and 2018, sardine landings ranged between 145,000 and 155,000 tons. The last major sardine transport took place in 2017, with the catch exceeding 337,000 tons.
There are around 68 fishmeal production plants mainly distributed in Karnataka, Kerala, Tamil Nadu and Maharashtra with a total production of around 300,000 tons per year.
Peruvian exports are declining
“There was a global shortage as fishmeal volumes from Peru, the largest producer, declined. This enabled us to export more at better prices of US$1,500 per ton compared to around US$1,200 last year. “In FY23, exports doubled to 50 percent of production,” said Dawood Sait, president of the Indian Marine Ingredients Association.
The Peruvian fishmeal industry is mainly based on anchovies.
On the other hand, the Indian fishmeal industry relies on a variety of fish, such as sardines, mackerel and mackerel, in addition to anchovies for production, Sait said.
Fish oil, a by-product of fishmeal production, was also shipped from India at a higher price due to lower production in Peru due to poor catches. “Fish oil fetched $4,000-$6,000 per tonne in world markets, compared to $2,000-$2,300 per tonne previously,” he said.
The booming export enabled fishmeal units to buy sardines at a cheaper price from fishermen. `
“The fishermen were getting around 40 rupees per kg for their sardine catch.” In recent years they have been earning 15 to 20 rupees per kg. And this time the oil content, which used to be between 3 and 6 percent, was 10 percent or more,” said George Lukose, a fishmeal industry consultant.
Boat operators also said fish landings, particularly sardines, have been higher over the past year.
“The inactivity of the fisheries during the first Covid-19 lockdown and the restricted fishing activities afterwards could be a reason for the higher catches,” said Joseph Xavier Kalappurakkal, secretary-general of the All Kerala Fishing Boat Operators Association.
As fishmeal exports increased, local shrimp feeders had to spend more money to buy the raw material, driving up their production costs.
“Fishmeal prices last year ranged from 135 to 150 rupees per kg, up by 30 to 40 rupees. The alternative was import, which was difficult due to tariffs and the expensive dollar. “The fishmeal shortage may continue as coastal states soon implement the annual ban on fishing during the monsoon,” said CR Rao, co-CEO of Avanti Feeds.
Demand exceeds supply
The feed industry has asked the government to impose tariffs or limit the export of fishmeal for the benefit of the local feed industry. In the last decade, the rapid growth of aquaculture activities in the country has made India the second largest shrimp producer after Ecuador with an annual production of over 900,000 tons. But the country’s fishmeal industry has not grown in parallel. The result is that demand for fishmeal exceeds supply.
The fishmeal industry is opposed to export restrictions, particularly the current moratorium on exports by unit since 2018. “Fishmeal production can be a great asset for the country.” China, a major buyer of fishmeal, got a taste of our sardine-based product and is now a regular buyer. If a smaller country like Peru with anchovy-based fishmeal can be the main supplier, India can do much better with a larger coastline and a large variety of fish. “The government should take action to promote the fishmeal industry in a sustainable way,” Sait said.
Will there continue to be sardine flows to the shores of India this year? CMFRI scientists said they won’t be able to assess that until the second half of this year, when catches begin to swell.
They attributed the decline in sardine catches in part to the El Niño weather phenomenon, which coincides with warming sea surface temperatures in the Pacific Ocean. It may have caused a temperature disturbance in Indian waters that has caused sardines to migrate offshore. They have returned a year after the onset of La Nina, the phenomenon that is the opposite of El Nino. Even without EL Nino, there could be a decline in coastal sardines every few years, they said.