China’s Ministry of Agriculture (MoA) has attempted to put a figure on China’s booming crayfish sector and come up with CNY 268 billion, or $42bn.
The huge valuation, which takes into account upstream sales, such as farm to factory, and downstream sales, such as in restaurants and supermarkets, is attributed to a massive increase in crayfish consumption by China’s growing middle-class, according to the ministry.
From lowly table fodder in parts of rural China, crayfish has arguably become China’s biggest food fad. In the report, which was produced in collaboration with Chinese Academy if Fishery Sciences, MoA attributed the surge in crayfish demand mostly to the crustacean’s popularity among urban millennials.
In Beijing and Shanghai, crayfish features on Chinese menus at the likes of Pizza Hut and KFC.
MoA hailed the impact of the demand surge on the fortunes of Chinese farmers, going as far as to say it has helped usher in a “new era of green fisheries development”.
Though Chinese aquaculture production statistics are viewed with skepticism, MoA said Chinese crayfish production has quadrupled from 265,500 metric tons in 2007, to a record 1.12 million metric tons in 2017.
“Crayfish has afforded undeveloped rural regions an effective catching-up strategy for rural development and poverty alleviation; played an important role in cultivating new opportunities for local economic growth; promoted structural reforms in the supply side of the agricultural (fishery) industry and efficiency; and increased the income of farmers (fishers),” said MoA.
Unlike most aquaculture species, the majority of crayfish are farmed alongside other crops, such as rice, meaning crayfish cultivation is a “low-cost new revenue stream”. MoA said 71% of production is from rice paddies, while farmers also raise crayfish in ponds in monoculture or polyculture, such as with crabs.
Farmers also cultivate crayfish along with water chestnuts and lotus roots. In Hubei, greenhouses are used through winter months, so farmers can bring crayfish to market when prices are highest.
According to MoA, farmers who multicrop with rice can generate CNY 4,500 in additional revenue from crayfish per mu (0.07 hectares) and CNY 2,000 in profit, margins which are fueling further growth.
Indeed, last month, China’s largest aquatic feed manufacturer, Tongwei Group, told Chinese industry publication Fish First that it plans to build a 200,000 mu (13,333 hectares) “modern crayfish farm” in Hunan. The farm, which will be joint managed by Tongwei and by farmers, will use specially-formulated crayfish feed and technological know-how to intensify production, the firm said.
According to MoA, the biggest production region is Hubei province, which produced 631,600t in 2017, followed by Anhui province (137,700t), Hunan (135,700t), Jiangsu (115,400t) and Jiangxi (74,400t).
Pressure on exporters
In 2017, companies processing frozen crayfish meat for export “continued to come under pressure”, said MoA, with many re-orienting towards the domestic market.
Last year, exports fell by 18% to 19,300t, according to MoA, while export values decreased by 18% to $217m in value, although MoA attributed this to trade barriers by the US and EU. Average export values remained relatively stable, at $11.27 per kilogram, down from $11.30/kg the year prior.
In late May, Undercurrent News reported rising prices in China meant at least one European importer was considering pulling out of the market.
However, the MoA report, though identifying higher wholesale prices, said prices in fact were lower during the peak harvest season in May and June last year, which is when international buyers typically make their orders (see graph).