Unintended consequences are “huge,” say experts
The ban on imports of crab from Russia went into effect on June 22 and US buyers are asking “where do we go from here?”
That’s according to market expert Les Hodges who says in his latest newsletter that the consequences on the industry are “huge.”
Russia has 94% of the world king crab quota and 30% of the (Opilio) snow crab quota, Hodges pointed out.
“The options to replace the loss of this source are poor. It is a fact that other world sources for king and snow crab will not be able to make up the shortfall in supply that the US crab market needs going forward,” he said.
Hodges added: “Russian crab was introduced in the early 80’s and has been developed in cooperation with Alaska producers, and marketed and sold by seafood importers and sales companies. With the unfortunate decline in the Alaska crab resource over the years, Russian crab became paramount in the U.S. market. The entire chain of distribution will be effected as more than $1 billion of crab and seafood will disappear in the near future from this market.”
Sales of existing Russian king and snow crab inventories “will buy companies some time as it will continue to provide a revenue stream for the near future. Hodges said that “progressive crab importers and marketers are now reinventing themselves and quickly rotating to develop and expand other existing products and new items.”
Russian crab producers also have changed direction and plan to expand their crab markets in Asia and Europe.
Prior to the ban going into effect, Russian imports to the US increased from previous years.
Undercurrent News reports that through the first five months of 2022, the US imported about 7,836 metric tons of Russian red king crab (nearly 17.3 million pounds) worth $681.8 million.
For snow crab, the US imported 1,836 metric tons from Russia (over four million pounds) worth $50.4 million, according to NOAA trade data.
By comparison, through the first five months in 2021 the US imported 5,416 tons of red king crab from Russia (nearly 12 million pounds) worth $237.3 million, and 12,944 tons (over 28.5 million pounds) worth $587 million throughout all of last year.
The US also imported 5,417 tons of snow crab from Russia (nearly 12 million pounds) worth $111.9m through the first five months of 2021, and 18,823 tons (nearly 41.5 million pounds) worth $509.9 million throughout all of last year.
Russia is the world’s second largest producer of snow crab with a 2022 catch quota of about 103 million pounds, up by 4%.
Snow crab from Canada rules the day
Eastern Canada is the world’s largest producer of snow crab. The Canadian catch quota for 2022 is over 111 million pounds, a more than 32% increase over last year.
NOAA trade data show US imports of Canadian snow crab in May were 110% higher than April at 25.7 million pounds.
Les Hodges said, “Demand remains somewhat lackluster compared to 2021 and prices are now down over 50% on some sizes as sellers work to find a support level. It is clear that the Canadian snow crab by default will be the primary source for the U.S. for the remainder of the year.”