India Cuttlefish Market Update : October 17, 2016
• India Cuttlefish Raw material pricing continues to increase. Raw material prices have increased significantly since mid-September.
• Raw material pricing has been increasing due to 3 main factors:
1. Aggressive buying activity on U/1, 1/2 & 2/4 from Spain. Especially from one particular buyer who is doing almost 50% more than last year from India (via a J.V with an Indian factory)
2. China is very active this year and picking up Cuttlefish blocks throughout India.
3. Short supply and increased competition between processors for raw material.
• Gujarat cuttlefish supply has been very poor this year and this is an important contributing factor to the increase in prices. The season was expected to begin in beginning of September as per usual trend. However, this year there was abnormal catches of small sized squid instead.
• Packers in Cochin believe that the season will end much sooner this year. Fishermen say that the catches of cuttlefish are dropping daily and catching could end by mid-November. We are seeing barely 4-5 MT of raw material in each of the South-Indian landing centres and more than 50 factories competing for this raw material.
Our concluding view is that there is no benefit to try to wait for prices to drop. It is highly unlikely that prices will come down, more likely they will rise further.