The global nature of the food industry at present is such that everything seems to be connected. This is evident from the fact that harsh storms along off the coast of Peru have resulted in a considerable rise in the price of oily fish which in turn is likely to affect the demand of Scottish farmed fish in a positive way along with Chinese pigs as well as Omega 3 tablets in Barratt and Holland.
Mark Livingston, the investment director of Fidelity Worldwide Investment, a global asset fund dealing with £138 billion worth of pensions and investments, believes that the leap in Anchovy prices is going to have an impact on prices of everyday items like anchovy pizzas too. He added that anchovies command a serious amount of money right now in the market.
Livingston is well aware of the price of this oily fish since it was Fidelity that, about three years ago, was able to realize the increasing importance of the fish and subsequently made an investment in a Norwegian company called Copeinca that is the owner of a fleet of more than 30 Peruvian anchovy fishing vessels and five processing plants spread across the country.
Extent of Change in Price
The situation was quite different even a few years back. Almost no one paid any kind of attention to anchovies unless they were a part of the fish oil industry. Anchovies were subsequently grouped together with other kinds of unpopular fish and labeled as industrial fish which indicates the sort of fish people do not consume directly. They are caught in huge quantities and then dried, minced and pounded into fish oil and fish oil.
However, it seems like after almost two whole years of suffering from reduced prices, fish oil and fish meal are once again becoming more expensive. People have gradually begun to pay attention to these products.
The price of fish oil has apparently risen from £950 or $1500 a tonne at the start of this year to $2000 for every tonne this month. On the other hand, the cost of fish meal has leaped from $1300 a tonne to a peak of $1700. The cost seems to be rising because of the increase in farmed fish which feed on them together with the replacement of fish meal as feed for animals since corn has become very expensive due to the severe drought in the United States.
Main Reasons for Price Rise
The price of oily fish has risen more than usual as a new consumer base has emerged in the form of humans. Direct consumption through the medium of Omega 3 pills has increased to 14% from the low 2% to 3% seen even 5 years ago.
Anchovy fishermen based in Peru along with their investors happen to be the greatest beneficiaries of the spike in fish oil since the anchovy found in Peru is considered to be the best fish in the world for the production of fish oil due to them possessing the largest amount of calories. The price of this oily fish has met with a further increase since the year 2009 because the government of Peru has imposed quotas on the quantity of anchovies that can be caught in the surrounding waters. The limit placed on the supply has obviously boosted the price.
Furthermore, severe Peru storms have made catching anchovies a much harder task. The strange changes in the pattern of the weather have caused the sea to become more turbulent and fewer number of people are willing to venture out to sea which has directly affected the cost of fishing.
Livingston considers the new push into the field of organic fertilizer to be another prime factor. The quality of fish meal has to pass a certified organic feed, as more and more consumers demand food to which chemical fertilizers have not been added.
Under ordinary circumstances, the price of salmon should have been forced up along with the price increase in fish meal and oil. But this year was different as the salmons were hungry. The temperature of the water in the North Atlantic was a few degrees warmer than usual this year which affected the appetite of the salmon and led to a bigger rate of growth.