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One Man's Opinion: Catfish industry is at war — with itself

Property of SeaFood Business magazine
By Peter Redmayne
June 01, 2007

You have to hand it to the catfish guys, they're fighters. And they have a lot to fight for. Farmed catfish is a $1 billion-a-year business.

Their first scrap was with the Vietnamese. When Vietnam started shipping a lot of farmed pangasius fillets, catfish farmers from the Mississippi Delta rushed up to Washington, D.C., and got a law passed that the Vietnamese could not call their fish catfish. Then they filed a successful antidumping petition that resulted in hefty tariffs on pangasius imports, which have been in place since 2003.

This time around it's the Chinese. They're a little trickier. And they're a bigger threat. In addition to pangasius catfish, the Chinese are growing the same species of catfish, Ictalurus punctatus , as U.S. farmers. The Chinese plan to export a whole lot of cheap catfish to the U.S. market. And nobody can ramp up production like the Chinese can.

Last year, U.S. imports of frozen Chinese catfish fillets reached almost 17 million pounds, up from less than 4 million pounds in 2005. In just the first two months of this year, Chinese catfish imports were 9 million pounds, compared to just 1 million pounds during the same period last year (about 75 percent of China's catfish exports are Ictalurus and 25 percent pangasius).

Because they can't play the name game, U.S. catfish producers are playing the food-safety card. In late April and May, the agriculture commissioners in catfish-producing states like Mississippi, Alabama and Louisiana halted the sale of Chinese catfish after they detected residues of banned antibiotics.

No matter that the levels were far below the Food and Drug Administration's action thresholds. In catfish country, they play hardball.

Of course the Chinese don't make it easy for themselves, as the recent tainted pet and animal feed crises showed once again. When it comes to cutting corners for an extra profit, the Chinese just can't seem to help themselves.

U.S. catfish farmers will probably continue to make it hard to sell imported catfish in the catfish belt, but that won't stop the rising tide of catfish imports. The U.S. market is big and demand for any reasonable quality frozen fillet that costs less than $2.50 a pound is very high.

At that price, U.S. catfish farmers lose money and production drops off. Over the past four years, the amount of acreage devoted to farming catfish has declined each year. Meanwhile, U.S. catfish processors, looking at less and less volume to run through their plants, are between a rock and a hard place. They can either continue to lose market share and money - or they can start importing catfish themselves, albeit at the risk of alienating their own farmers.

Faced with that Hobson's choice, it's not surprising that the big catfish importers are U.S. catfish processors. No doubt U.S. catfish farmers are already talking to their lawyers about taking on the Chinese with a dumping petition. But as is the case with the Vietnamese, they may win the battle but lose the war. In spite of the duty, imports of Vietnamese pangasius doubled last year to a record of almost 40 million pounds. The U.S. catfish industry may soon find they have no one to fight with but themselves.

 

Contributing Editor Peter Redmayne lives in Seattle

 

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