With the closing down of the catering and restaurant sector in many countries, cephalopods are being particularly hard hit because most sales occur in this sector. As summer holidays are approaching, the high season for octopus and squid consumption in Europe should also be approaching. However, there will be no “normal” summer season this year. At the same time, squid fishing off Argentina is very good. Thus, supplies are strong putting further pressure on prices.

Octopus

During the first three months of 2020, Japan’s imports of octopus increased slightly by 1.2 percent to 8 913 tonnes. Mauritania registered a massive increase in shipments to Japan during this period, up 248.5 percent to 4 022 tonnes. Shipments from the two major suppliers, China and Viet Nam, were down however, by 28.5 percent and 34.0 percent, respectively. Imports by the Republic of Korea during the first quarter of the year declined by 25.4 percent. All major suppliers registered a decline, with China falling by 16 percent to 5 764 tonnes, Viet Nam by 30.8 percent to 5 098 tonnes, and Thailand by 24.0 percent to 1 362 tonnes. Vietnamese exports of octopus dropped by about 24 percent during the first three months of the year compared to the same period in 2019. Total exports amounted to a value of about USD 50.5 million.

The largest markets were the Republic of Korea and Japan. When restaurants and bars were closed down in many countries due to the COVID-19 pandemic, import orders for octopus, squid and shrimp dropped practically everywhere. In Italy, there was a notable drop in import orders, as was the case in other major markets such as Spain and Japan. In Europe, the effect will be felt even more during the summer, as octopus is a popular item among the many visiting tourists. Although some areas in Greece, Spain and Italy have re-opened their bordersfor tourists from “coronavirus-safe” countries, sales of octopus will nevertheless be severely affected this summer.

Vietnamese exports of octopus to China dropped in January and February this year but recovered significantly in the following months. During the first five months of 2020, Vietnamese exports of squid and octopus to China rose by 38 percent by value, to USD 13.7 million. However, exports to other countries dwindled because of the COVID-19 pandemic, so total exports declined by 21.2 percent during the period. For Vietnamese squid and octopus, the most important markets (after China) are the Republic of Korea, Japan, and the European Union.

Squid

It is perhaps a paradox that Argentina is experiencing a strong increase in its squid landings this year, while demand seems to be dropping or hindered by the COVID-19 pandemic. In the Province of Buenos Aires, there seems to be an overabundance of squid. As of 20 June 2020, 66 000 tonnes were landed. In comparison, the best year in this region was 2005, when 57 000 tonnes were caught. And this year, the season is not yet over. Argentine vessels have had a difficult time keeping operations afloat because of the COVID-19 pandemic. The government introduced social distancing rules in March, which meant that vessels had to be operated with a reduced crew.

The Falkland Islands (Malvinas) authorities have also confirmed that this year’s squid season is good, as the first season yielded about 62 000 tonnes of Illex and 30 000 tonnes of Loligo squid. The second season is set to open at the end of July. It has been reported that more than 100 foreign vessels are fishing just outside the borders of the Argentinian waters. While Chinese and Republic of Korea vessels have been in the majority, other nationalities are also involved. In early May, a Portuguese vessel was arrested inside Argentine territory.

Chinese vessels are by far the most numerous among these foreign vessels, and there have been several incidents of Chinese vessels operating in Argentina’s Exclusive Economic Zone (EEZ). China’s distant-water fleet is monitored by China’s Fishery Bureau in cooperation with the Chinese Overseas Fisheries Association, and a new draft of a management system proposed by China’s Ministry of Agriculture is now being reviewed. If approved, this will restrict Chinese vessels in the South Atlantic squid fisheries. It will also include seasonal fishing closures, human observers and electronic monitoring coverage.

Trade

During the first quarter of 2020, China increased imports of squid and cuttlefish modestly, from 64 017 tonnes in 2019 to 67 294 tonnes in 2020 (+5.1 percent). The major supplier, Indonesia, however, saw a reduction in shipments of almost 22 percent to 17 862 tonnes, while Peru increased shipments by 27 percent to 16 986 tonnes, and India shot up 152 percent to 6 357 tonnes.

On the other hand, Chinese exports of squid and cuttlefish declined by 11.6 percent during the three-month period, from 107 546 tonnes in 2019 to 95 448 tonnes in 2020. Shipments to all the major markets declined.

Japanese imports of squid and cuttlefish were fairly stable during the first three months of the year, with imports reaching 30 788 tonnes in 2020 compared to 30 698 tonnes in 2019. The major supplier was China, which accounted for almost 62 percent of the total. The Russian Federation, which in the two preceding years exported very little squid and cuttlefish to Japan, increased its shipments to over 1 950 tonnes, up from just 24 tonnes in the same period in 2019, and zero in 2018.

Spain’s imports of squid and cuttlefish during the first three months of 2020 fell by a little over 10 percent, to 44 400 tonnes. Shipments from the major suppliers all increased: Morocco by 40 percent, India by 13 percent and Peru by 20 percent. Shipments from other countries dropped by as much as 32 percent, to just 20 279 tonnes. The United States of America saw an increase in imports of squid and cuttlefish during the first quarter of the year, up 5.9 percent from 13 197 tonnes in 2019 to 13 978 tonnes this year. Both China and India shipped more squid and cuttlefish to the United States of America, while Taiwan (Province of China) shipped 8.7 percent less than during the same period in 2019.

Outlook

The cephalopods sector is especially hard hit by the COVID-19 pandemic as most consumption occurs in restaurants and the foodservice sector. While retail sales for home consumption has improved somewhat, it does not fully compensate for the loss in the foodservice sector.

As summer holidays are approaching in Europe, this effect will be felt even more. Tourism has been devastated, and there are now signs that the pandemic may be returning in parts of Europe. Spain recently opened its borders to tourists from “safe” countries but had to impose another lockdown in Galicia and Catalonia. The regions in the south seem to be less affected, though. The effects of the virus will be long-lasting. It is unlikely that 2020 will see a recovery, and the cephalopods sector will certainly feel the exacerbating effects as the year wears on. Prices are expected to weaken somewhat.

It seems it is time to start thinking in new ways, develop new products that are easy to prepare in home cooking, or turn to home delivery and take-out at the restaurant level. Innovation is needed, and could potentially save at least part of the sector.