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A press notice in April 2020 explained that at that time, the first season product was just arriving on the international market so it was premature to take a view on the situation as it was back then. Now that we have had product available for some weeks, it is possible to provide a more informed assessment.
The Falklands Seafood industry, in common with most other sectors, continues to face an environment of great uncertainty. Covid-19 is of course a major challenge but in addition the consequences of BREXIT are still unknown but potentially damaging, recent increases in costs and the political rhetoric from Argentina and their efforts to obstruct our development have become increasingly menacing.
Market demand patterns for our products are changing, there are some sales into traditional major markets in Spain, Italy and Portugal but volumes are significantly reduced, due to a fall of in demand generally due to lockdown measures across those countries and also because catches for the first season 2020 were about 50% of last year.
The wholesale market in Europe and Asia remain basically shut down. Current sales are to retail channels or to wholesalers who are processing for retail outlets.
The demand situation does vary between the key markets in different countries. July and the rest of the northern hemisphere summer months is expected to see a growth in that demand with the hope that more hotels and restaurants continue to re-open. Key to this growth will be down to international and local travel restrictions and the hope that consumer confidence will begin to grow. This is a process that will take some time.
Thankfully, current prices have reportedly been stable, with some reduction on previous prices in some categories. There is an expectation that prices may decline further, between 15% and 25% as more product enters the market.
Many buyers in the market are facing cash flow issues and a possible rise in bad debts is a concern.
Our marketing teams are working hard to keep close contact with existing and new customers. This close contact with our global customer base is a key strength in meeting the challenges we face.
Operations departments moved quickly to put in place all the required changes to keep our people safe, supported by HR and other teams to deal with the discharge at the end of last season, the work required in port and all the many tasks required readying our vessels for the second half of 2020.
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