Expected price rise not likely

There is downward pricing pressure on the value of New Zealand's rock lobsters (pictured) because of an easing in the Chinese economy. Photo from Niwa.
There is downward pricing pressure on the value of New Zealand's rock lobsters (pictured) because of an easing in the Chinese economy. Photo from Niwa.
Crayfishers playing a waiting game in the hope demand from China will help prices rise to last year's levels may be waiting a long time.

That is the word from the country's biggest live lobster (crayfish) exporter, the Fiordland Lobster Co, based in Te Anau.

Some crayfishers have told the Otago Daily Times they are being offered $60 a kg for their catch, so have decided to wait in the hope the price rises later in the year to the $80 they were getting last year.

Three years ago, it peaked at more than $100 a kg.

Fiordland Lobster sales and marketing general manager David Prendergast said business had generally been "a lot harder" this year.

"The key thing is that the [Chinese] economy is showing signs of a slowdown and therefore the discretionary income in China to spend on high-value items may be cut back in all sectors, and obviously that will affect the demand for live lobster."

Mr Prendergast said the company was selling the same amount of lobster as in previous years but there was "a little more pressure" on pricing because of the Chinese slowdown.

Lobster is traded in United States dollars and Mr Prendergast said the high level of the New Zealand dollar against the greenback was another factor affecting returns for crayfishers this year.

Mr Prendergast said he could accept crayfishers who were paying $50 a kg to lease quota were keen for something about the $80 a kg mark.

"But, realistically, are they going to get $80 later on?

"There is a world slowdown and that world slowdown is affecting China.""People's discretionary income is tucked away and therefore they become a bit more conservative.

"If they [crayfishers] are all sitting around waiting for $80 they could be waiting for a while."

Chairman of the crayfish management committee for much of the South Island, Malcolm Lawson, said the "rule of thumb" for crayfishers who leased quota at, for example $50 a kg, was that they needed a $20 margin to make crayfishing worth their while.

His committee did not get involved with the commercial aspects of the industry and was mostly concerned with ensuring there were good stocks of crayfish, which there were.

That, Mr Lawson said, allowed fishers to pick and choose when they caught their quota.

"Instead of having to aim to go out every day to fill their quotas they are actually fishing to the markets.

"The fishers stop and start as the market prices and demand dictate. And that is one thing about having an abundant fishery. It provides the opportunity for them to do that."

Mr Lawson said it was generally acknowledged every 1c change in the exchange rate represented a $1 a kg change in the return to crayfishers.

Mr Prendergast said October was traditionally "the worst month" in the annual marketing cycle for lobster after strong demand in September in the lead-up to Chinese National Day on October 1 and prior to demand created by Christmas and particularly the Chinese New Year.

-mark.price@odt.co.nz

ODT/directory - Local Businesses

CompanyLocationBusiness Type
Flight Centre Alexandra AlexandraTravel Agents
755 Regal Court MotelDunedinMotels
Wanaka Catering WanakaCatering
Bowen Technique & ReflexologyOamaruMassage Therapists