E-commerce, casual dining chain expansion driving demand for low-priced whitefish in China

Chinese whitefish processors, as well as exporters of pangasius and other low-cost whitefish globally, are capitalizing on increased demand for the products in China as informal dining chains and e-commerce services expand both domestically and abroad.

Li Zhiwen, the deputy general manager of Yangjiang Xincheng Aquatic Producers, said during a pangasius forum in Wuhan that the potential for whitefish sales is practically infinite at the moment, amid the rise of Chinese mass-market seafood restaurant chains. He said the trend is showing no signs of stopping, as softer economic growth is likely to continue driving demand for lower-end whitefish species.

Informal dining chains serving lower-priced seafood dishes have become increasingly popular in China.

A major reason why restaurants are finding now a good time to expand is that sales in China’s dine-out sector have skyrocketed since Covid-19 regulations were lifted in the country.

It’s not only restaurant expansion that is driving the demand spike for whitefish, though.

China’s e-commerce channels have facilitated demand for firms processing lower-priced seafood species. The rise of Chinese e-commerce, on the back of huge user numbers and low-priced goods, has enabled key players like Alibaba and Temu to expand into other Asian markets.

Capitalizing on this ever-growing sales avenue, grilled fish specialist Guangdong Mingji Aquatic Products is doubling its catfish production capacity with the aim of growing its exports and selling to regional consumers through cross-border e-commerce, according to Guangdong Mingji Aquatic Products Chairman Zheng Zhuofeng. 

This expansion of both e-commerce and dining chains spells good news for producers of key species such as pangasius and catfish

Zeng Lin Bin, head of domestic market promotion at Guangdong Evergreen, said the pickled and grilled fish restaurant trade is worth over CNY 1 trillion (USD 140 billion, EUR 130 billion) a year, largely thanks to the expansion of franchised chains.

However, though demand is high, increasingly intense competition in the processing sector has driven down the price paid for fish. As producers are being squeezed by lower prices for their fish, they are also running into rising feed prices, requiring them to pursue alternate strategies, such as species diversification.