The Malachite Green scandal continues to run in China. Containers of Kabayaki have been returned from Korea at some costs to the processors. The Chinese Government has prohibited the export of eel over the summer in an attempt to introduce some measure of control. During our visit a few months ago we could see an unprecedented level of panic and loss of confidence in the market due to the contamination of Kabayaki with  Malachite Green. There is a belief that in Fujian province or for that matter where ever there are issues relating to poor water quality whether it will be possible to culture A. anguilla without the use of Malachite Green. I do not believe this to be the case  but  certainly increased levels of parasites and fungal disease will increase production costs.

The ex-farm price of eel in China  is:
                RMB 40-53/kg    (AA)
                RMB      75/kg    (AJ)

The Chinese Government has just relaxed its embargo and some export licenses have been issued to the Kabayaki factories. As a precaution  there are  restrictions to the licenses that are more onerous than those of the  importing countries.  I sense at the moment processors  are nervous about being first in the market. There are still uncertainties how the testing will be carried out and how the market will react to the first imports.  There is still not sufficient traceability to enable the processor, in the event of contamination with malachite, to be able to apportion the blame to the primary producer.   The export of Kabayaki is slow to start.

This year there is recognition from the Chinese Government that the farms and traders have suffered significant losses due to the Malachite green scandal. The release of quotas for the import of glass eels seems to have been easier this year.

There are some glass AJ appearing on the market. A little bit earlier this year and perhaps slightly higher catches. Prices are 10 HKG dollars per piece.  For  those that cannot remember the prices last season they started at 6 HKG dollars and the median price was 12 HKG dollars per piece.

China is waiting for low cost glass eels Anguilla japonica or Anguilla anguilla. With exports permitted the eel economy will start to gather speed. It is not a question if China will enter the market this year but simply when.

At  what price level will China intervene in the market?  Is their expectation of 400 to 450 euros per kilo realistic. ??