Spread over three floors, the Mellish Island outlet is owned by Harbin Century Yu Chen International Trading Corp. The firm has offices in Los Angeles, established in 2010, to oversee its sea cucumber sourcing.Mellish sales staff quoted SeafoodSource CNY 1,600 (USD 258, EUR 201) for 200 grams of fresh cucumber, with prices ranging up to CNY 5,000 (USD 806, EUR 628) per 200 grams.
“The sea cucumbers from America are wild so they taste much better than sea cucumbers from China which are all farmed,” explained floor manager Yu. Mellish is also offering free bottles of French wine with purchases of its dried U.S. sea cucumbers and the firm hopes to open stores across China in the coming year, added Yu.
Leading local cultivators of cucumbers have also been opening stores. Praised for their apparent medicinal properties, sea cucumbers have become a sought-after commodity in China, yet leading cultivators have struggled in 2012 with falling prices. Headquartered in the coastal city of Weihai, Shandong Homey Aquatic Development Co in 2012 processed 2,928 tons of sea cucumber, compared to 2,282.7 tons in 2011. Yet prices slipped over 10 percent to CNY 167 (USD 27, EUR 21) per kilo, according to the firm’s own results filings. Homey has attempted to increase its penetration of smaller-sized cities and the middle class by opening 18 own-brand and 74 franchise stores around China in the past year.
Sales volumes of cucumbers were up 20 percent in 2012 to 1,000 tons at Shandong-based Oriental Ocean Co, but fell in value to CNY 157 (USD 25, EUR 19.70) per kilo compared to CNY 200 (USD 32, EUR 25) per kilo in 2011. A 30 percent decrease in production in Fujian will help prices rebound. Shandong Oriental group cultivates about 2,733 hectare of sea area for sea cucumber cultivation, with the bulk of sales going to fresh markets.
A leading analyst of China’s seafood sector is predicting a huge market still to develop for China’s sea cucumber producers. In a report China Investment Securities, which follows agriculture and aquaculture firms, predicts market leader Homey will expand on its 3,066 hectares of sea cultivation area. The report foresees much scope for firms like Homey to develop brand value and notes that leading brands like Yiqiao, Zhangzi Dao and Homey each account for only 5 percent of the market.
As sea cucumbers become a “consumer good” he sees market to build sales channels and demand for sea cucumber as an input in other food products. Likewise, if self-sufficiency in sea cucumbers is raised from 50 percent to 90 percent China’s sea cucumber firms stand to gain massively in terms of profits.
Homey spent CNY 400 million (USD 65 million, EUR 50 million) on a new harbor and CNY 70 million (USD 11 million, EUR 9 million) on six new vessels in order to double production this year. Overall though, China's sea cucumber producers will have to improve yields, given competition in China for land and sea the scope for increased cultivation space is limited. Others, like Mellish Island, clearly see the opportunity in imports.
