The introduction of strict quarantine measures in Italy this week has slowed down seafood imports into the country, with the retail sector representing the only hope for exporters supplying it, industry sources told Undercurrent News.
On Wednesday, the country's prime minister, Giuseppe Conte, ordered bars, restaurants and all shops to remain closed, with the exception of supermarkets, food stores and chemists. Earlier in the week, he had extended a travel ban and other strict measures first implemented on March 7 only in the Lombardy region and 14 other provinces to the whole country.
"The first cancellations came in last Saturday, after the Italian government introduced the measures to contain coronavirus in Lombardy," an octopus and squid supplier based in Morocco told Undercurrent on March 11.
"We did not have orders canceled, everything we have for retail is in high demand. The Italian foodservice sector is KO [knock-out]," another source, a Spanish supplier of frozen whitefish and shrimp told Undercurrent.
Italy imports €4.7 billion of seafood annually, making it the third-largest seafood market in Europe by value, with Spain its largest supplier generating nearly €1 billion in export value back in 2018.
Frozen cuttlefish, squid, frozen shrimp and frozen octopus are the most important Italian seafood imports when measured by value.
Even though they are mainly imported frozen -- so in theory, they could be kept in storage at the origin for a longer time in case orders are canceled or postponed -- the quarantine measures are still causing a massive headache for exporters, the first source pointed out.
"Now [the octopus and squid trade] is practically all paralyzed," the first source said, noting that orders from Italy and also Japan, another large octopus importer, had dropped due to the coronavirus outbreak affecting the tourism industry in both countries. In Spain, buying was slow even before the coronavirus outbreak in Italy, he added.
Although the octopus fishing season is still ongoing in Morocco, prices remain "artificially high" and "we will see later an impact of the coronavirus outbreak on the market when fishermen come with the fish and they have to sell it".
A drop in orders for restaurants and hotels would restrict buyers' cash flow, reducing their ability to buy, he added. "The damage will be soon; it'll settle in 15 days."
"Squid size 3P is currently at €6.70 per kilogram FOB [freight on board] and 2P is €1/kg more expensive. Octopus size T6 is at €7.80/kg, T7 at €7.40/kg and T5 8.40/kg FOB," he said, referring to prices for the Italian market. He added that purchases from Spanish buyers had slowed also, partially because their orders from Italy and other markets had reduced due to the coronavirus impact.
Some truck drivers in Spain currently refuse to do deliveries in Italy for fear of being affected, the first source added.
Shares in Marr, Italy's largest foodservice operator, have collapsed. "Marr heavily relies on sales to restaurants," a third source pointed out.
A drop in tourists from China has caused cancellations in hotels in Japan, causing a drop in seafood demand from the sector, the octopus supplier said, adding that much of the octopus for the Japanese market is normally processed in China. Larger companies are able to move their processing activity to Thailand, but the smaller firms are suffering, he noted, stressing that this was also affecting the octopus trade.
Contact the author matilde.mereghetti@undercurrentnews.com