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Bangkok tuna market holds breath as skipjack prices set to fall for June deliveries

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Thailand: According to tuna sector sources at Thaifex and the Infofish Tuna 2018 conference, Bangkok skipjack prices are set to come down for June deliveries.
 
Big packers and traders have not yet agreed on a final level for June, but several sources said the price will come down.
 
Aware of the bearish trend, many buyers are awaiting to sign contracts, hoping to be able to save an additional $20-50 per metric tons or perhaps more on the purchase price, sources told Undercurrent News.
 
The market is stagnant, one source at a large firm told Undercurrent, pointing out that buyers were awaiting prices to fall further before signing contracts.
 
“There’s a lot of smoke and mirrors,” another tuna sector veteran told Undercurrent.
 
“The pressure is on for the price to drop, but nothing has been agreed yet. As of today, there’s not change (from $1,700/t). Probably, no firm deals will be done until next week,” the second source said.
 
A third source, from the canning side, agreed no deals have been done and that prices would likely drop.
 
But a fourth source mentioned that a deal at $1,600/t had already been done for skipjack tuna for June delivery in Bangkok. The first source hinted to a price between $1,600-1,650/t, but pointing out that there had not been deals at this level or remaining vague.
 
A fifth source said that he heard $1,600/t had been done by a couple of large firms, but didn't know in what volumes. He noted that last week and the start of this one nobody had mentioned any price. It was only on Tuesday evening that participants of the Bangkok tuna conference had started to mention this price level around $1,600/t, he told Undercurrent.
 
This source noted that a recovery of fishing in the eastern Pacific in recent week, where skipjack prices fell to $1,750/t (or slightly below), was a pressuring factor for the price in Bangkok. This means that Taiwanese firms, who had delivered some volumes to Ecuador and neighboring countries, were instead going to deliver those volumes in Bangkok.
 
Prices had surged to $1,800-$1,825/t in May, from around $1,450/t in March, to then fall to around $1,700/t last week.
 
Going ahead
Sources were expecting June prices for delivery in Bangkok in the range of $1,600-$1,650/t, or even falling to $1,550/t or possibly $1,500/t. Then, prices could rebound toward the end of July and the following months. But, most sources were not keen in doing forecasts for the coming months, as prices depend on demand and supply, which is hard to forecast with a wild fishery.
 
Prices might remain stable for a couple of months, or fall a little more, the first source said, but stressed it was very hard to forecast the level. The issue is that when buyers expect prices to fall, they put contracts on hold and canneries do not buy from their suppliers, he noted.
 
Considering that stocks in Thailand are relatively full, with tuna, chicken and also some fruit filling up cold storages, the slow down in making contracts for new canned tuna production is causing stagnation in the market.
 
Yellowfin tuna prices
Catches for skipjack tuna in the western Pacific were reported to be "good", while yellowfin tuna scarcity in different oceans was pushing prices for this species up in Bangkok.
 
According to one source, yellowfin tuna had gone up to $2,950-3,000/t, from about $2,800/t, while a second source said the price level was higher than that.
 
In Spain, according to one source, yellowfin price for May delivery was at €2,500-2,550/t. A source at another company said the price was higher than that, at around €2,600/t, and going up due to the voluntary "veda", or closure, of some Spanish vessels and the upcoming veda in some oceans.
Source: Undercurrent News

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