Drop in exports to Japan causes a halibut glutKorea is suffering from a halibut glut, as a dramatic oversupply of the popular fish has forced prices to plummet across the country.
The price of halibut, which is a popular choice for sashimi, has fallen to 8,000 won per kilogram ($3 per pound), well below the production cost of around 10,000 won, as of Oct. 28. In October 2017, the wholesale price of Jeju halibut was 17,000 won per kilogram.
One major reason behind the halibut oversupply is the tightened quarantine of imported fish by Japanese authorities. Japan recently tightened measures saying it needs to increase the size of samples analyzed to eradicate kudoa septempunctata, which causes food poisoning. From June, 40 percent of Korean halibut has been subject to quarantine, compared to 20 percent in the past.
According to the Korea Customs Service, exports of flatfish to Japan in September fell by 24 percent on year to $1.81 million. Japan is the major buyer of Korean halibut, accounting for roughly 80 percent of halibut exports.
Another driver of the halibut sales decline is the growing popularity of other fish products, like salmon.
After halibut started being cultivated en masse in Korea from the 1990s, sashimi made out of halibut became popular for its relatively cheap price. However, with the widely touted health benefits of salmon, halibut demand started to fall.
Salmon import volume increased by 37 percent from 27,000 tons in 2016 to 37,000 tons last year. According to retail chain Emart, revenue from slices of raw salmon, or salmon sashimi, from January through September this year jumped by 40 percent on year, while halibut sashimi sales fell 18 percent during the same period.
The Jeju Special Self-Governing Province announced last month that it will inject emergency funds to help fish farms deal with the oversupply problem.
The fund of roughly 1.4 billion won ($1.2 million) contains money from the Jeju government, as well as fish farms and the island’s federation of fisheries cooperatives. The Jeju government said it will use the funds to purchase 200 tons of midsized halibut - weighing between 400 and 600 grams (between 0.88 and 1.32 pounds) each - from 359 halibut farms in the island and dispose of them to reduce supplies.
The reason for the large financial commitment is because industry insiders expect sluggish sales of halibut to drag on until next year. Disposing of halibut before they grow larger - up to about a kilogram each - is the last measure fish farms can take to adjust supplies for next year.
To help halibut farmers, the Jeju government has been mulling various plans including increasing the supply to the Korean army. The local government signed a deal to supply 198 tons of farmed halibut to the Korean military, which is a 70 percent increase from last year.
Halibut farmed in Jeju accounts for about 60 percent of local supplies.
Despite falling demand for halibut, cultivation of the fish has been on the increase thanks to the development of farming technology.
Local retailers are also actively looking to promote halibut.
Emart sold roughly 450 grams of halibut sashimi at a 40 percent discounted price of 23,500 won, rather than 39,800 won, until Wednesday. The discount event was planned jointly by fish farms and the retailer.
BY KWAK JAE-MIN [firstname.lastname@example.org]