China COVID-19 restrictions to remain in place through January

China’s testing of seafood for traces of COVID-19 will remain strict for the rest of the year, according to a leading marketing consultant in Shanghai.

Robin Wang, the CEO of SMH International, a seafood-focused marketing agency with offices in Shanghai and Hong Kong with clients including the Alaskan Seafood Marketing Institute, told SeafoodSource the move will negatively impact the broader food market in China.

“In terms of testing, China is taking a hard stance against all types of frozen foods, not just seafood, but all sorts of meats, beef, pork, etcetera,” Wang said. “The Chinese authorities just want to be careful, and the most important thing is traceability,” he said. “If COVID is detected, they can shut down both the upstream and downstream directions and isolate the questionable product.”

New procedures have included product testing, product packaging testing, inspection, and disinfection of cold-storage warehousing, as well as closer scrutiny of certificates of origin.

“Overall, the process is taking longer, and the incidence of inspections is much higher, but frozen seafood is still coming in,” Wang said.

Demand for salmon remains soft across China, Wang said.

“I don’t think we’ll see a price recovery this month. Demand for salmon is still not as high as other products like pollock. Much of the salmon consumed is in the HRI sector is mostly in Japanese restaurants for China, some in retail. And in Hong Kong, salmon is more popular in most restaurants, but opening up of restaurants and foot traffic has been much slower,” he said. “This will take some time given existing demand levels.” 

However, Wang’s conversations with representatives of the trade and HRI sectors, as well as data from the National Bureau of Statistics suggest to him that “things are moving in a positive direction.” Mainland China is returning to normal faster than Hong Kong, said Wang.

“Traders are beginning to explore more product options and orders, amounts, and frequency, are starting to tick up,” he said.

Yet while he points to data from the government suggests the Chinese economy is in recovery – moving from  a contraction of 6.8 percent in Q1 to growth of 3.2 percent in Q2 and and 4.9 percent Q3 – total retail spending, while up four percent quarter-on-quarter, is down year-on-year. Nevertheless, Wang said he is optimistic about recovering demand.

“As the economy improves, so should consumer spending,” he said. “This trend should be buoyed by end-of-year spending plus consumption for Spring Festival.”

Photo courtesy of Mark Godfrey/SeafoodSource