Supply problems with Peruvian anchovy could create opportunity for alternative marine omega-3 sources

By Hank Schultz

- Last updated on GMT

Low biomass has led to the recommended closure of the Peruvian anchovy fishing season.
Low biomass has led to the recommended closure of the Peruvian anchovy fishing season.

Related tags Omega-3 fatty acid Overfishing

The closure of the upcoming fishing season in Peru will have a generally positive effect on the suppliers of other niche omega-3 marine ingredients, sources say.  But it is more complex than a mere commodity relationship in which scarcity in one source creates heightened demand in another.

Peruvian authorities took the extreme measure of recommending the closure of the upcoming three month fishing season because of low biomass readings.  The fishing closure, announced earlier in October, followed on the heels of an acoustic survey that found very few fish in the fishing area. 

Productive, but volatile fishery

The anchovy fishery off Peru is enormously productive and even with the development of alternative sources of supply still accounts for about 70% of the world’s servings of omega-3 ingredients.  The fishery relies on the rich upwellings of the Humboldt Current, a cold current close to the coast that brings nutrient-rich waters to the surface supporting an abundant growth of plankton on which the anchovy feed directly.

The system is in a delicate balance and is subject to periodic disruptions such as this year, in which warm water intrusions associated with the El Nino weather phenomenon can drive down the stock. IMAPRE, the Peruvian fisheries authority, found only 1.45 million metric tons of biomass in its survey of the northern fishing zone, significantly below the average of about 10 million metric tons.  It is unclear whether the poor water conditions, with higher temperatures, less food and lower oxygen levels, actually kills fish or forces them to disperse out of the fishing zones.

The overall world demand for omega-3s has spurred the development of alternative sources of marine ingredients. Among these are are menhaden, fished off the eastern and southern coasts of the US, krill, which is harvested in the South Atlantic near Antarctica, and oil from Alaskan pollock, which is caught in the Bering Sea. NutraIngredients-USA spoke with two companies sourcing ingredients in these alternative streams—Aker BioMarine and American Marine Ingredients, to gauge how the situation in Peru affects their businesses. In both cases, the companies supply omega-3 oils into the supplement market and also operate their own fishing fleets.

Stability of pollock

Richard Draves is vice president of American Marine Ingredients, a division of American Seafoods.  The company markets an ingredient called 54°North Omega-3 with Vitamin D3 sourced from Alaskan Pollack. Draves said as a matter of experience some elasticity has been built into the fish oil markets.

“The Peruvian fishery is subject to ups and downs because of climatic factors.  I think the key consumers of those products protect themselves by inventorying a fair amount of supply. Different companies handle those situations differently in their supply chains. Some might see a reduction of inventories and price pressure as a result. It comes from how much experience and skill they have purchasing in a commodity market,”​ Draves said.

Draves said the pollock fishery is subject to less drastic up and down cycles that the anchovy fishery from Peru, making it a stable source of supply.

“Sure, we talk about stability. We generally talk about it independent of other fisheries so as not to cast a bad light on their operations. We are looking at the highest biomass in the Alaskan pollock fishery since 1982. I think it is a testament to the management scheme that we have in Alaska.

“I will say that the situation in Peru is not fault of the fishery managers there, but is in fact a testament to their management of the resource. More than anything else is a result of the volatility of the supply.  Anchovies are short lived and in Peru they are generally catching only one year class of fish. We might be harvesting fish from four to six year classes, ranging typically from four- to eight-year-old fish,” ​Draves said.

“When you are producing a novel ingredient ​(AMI is one of only two companies making omega-3 oils from pollock) there is enough risk inherent in production and marketing. It’s nice to not have to worry about supply,”​ he said.

Education opportunity for krill

For Aker BioMarine, the world’s largest single harvester of krill, the real opportunity in the present supply situation lies on the education side, said marketing director Becky Wright. The company has already seen significant market uptake for their Superba brand krill oil ingredient.

“Our figures show that brands that feature Superba grew their market share 12% over the last year.  We are attributing that to some of our education efforts, but there is more that we can do. We find that nine out of 10 doctors are recommending omega-3s to their patients, but of those doctors, eight out 10 are recommending fish oil. By contrast, krill is much farther down the list. We obviously have some room to educate people,”​ she said.

Aker has long touted its sustainability bona fides.  It has worked with CCAMLR, the multinational body that regulates the Antarctic fisheries, to make scientific assessments of the krill biomass and it has received a sustainability certification from the Marine Stewardship Council.  The sustainability side of the coin is becoming a bigger part of the omega-3 conversation, Wright said.

“When we get in there and talk to doctors they want to talk about science.  They want to talk about things like the omega 3 index. But but second to that and not far off they want to know about sustainablity concerns.  The issue of supply certainly comes into that conversation and the news that the Peruvian fishery has closed certainly will have an impact,” ​Wright said.

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