Surging supply-side costs for Thai tuna could hit retail prices

Surging supply-side costs for Thai tuna could push up the price of cans in supermarkets this year.

Thai skipjack tuna prices are up 96% year on year to £1,381.4/Mt due to low catches in the Western Pacific and Indian Ocean and the weakness in the sterling, according to Mintec.

Tuna prices were expected to start falling when vessels increased catches following the end of the Fishing Aggregating Device (FAD) ban in October 2016, but catches of both skipjack and yellowfin tuna have remained low despite the end of the ban, Mintec says.

A 15% drop in yellowfin tuna catches in the Indian Ocean imposed by the Indian Ocean Tuna Commission (IOTC) since the beginning of 2017 has put further upward pressure on prices, it adds.

UK brands warned last year that rising raw material prices could push up the cost of tinned tuna for UK shoppers.

“Category prices are closely related to variations in the cost of raw materials and although price deflation has been a key factor over the past 12 months, we do not expect this trend to continue into next year due to an increase in commodity prices and the effect of a weaker pound,” Princes MD Neil Brownbill said in October.

John West owner Thai Union reported in November that an “unexpected” high tuna price in Q3 2016 had “posed a challenge to our Thailand-based tuna export business as well as our branded ambient seafood business in Europe”.

Thailand was the world’s largest tuna exporter during January to October 2016, according to latest data from the UN FAO, although Thai tuna exports to the EU were down 13.4% compared with the same period in 2015.

UK tuna imports were up 13% over the same period as demand, particularly for pole-and-line tuna products from the Maldives, increased.