--- There was speculation that Atlantic Cod would be flooding the market, creating a downward spiral in price, but that seems to not be the case. Reports show that inventories are not as expected, and approximately only 40 percent of the quota remains to be caught. Raw materials have increased by about 15 percent in the past 2 weeks from $2700 to $3100 per metric ton. Much of the landings have been large raw materials, consequently driving small raw materials to even higher levels of $3300 per metric ton. Speculation is for higher costs by an additional $400-500 a metric ton in the next few months. Atlantic cod had dropped below $3.00/lb for Loins, but we now expect the market to move up quickly by 20-30 cents/lb. According to all indicators, the overall weakness of cod pricing and large inventories is over and the rebound to stronger pricing is immediate. --- In other news, according to the NOAA Climate Prediction Center, there is a 65 percent chance of a transition to El Nino this summer and could be the worst in decades. Recent reports have shown above-average sea surface temperatures across the equatorial Pacific Ocean. The shift in water temperature is likely to cause the movement of fish into more northerly waters. One of the major consequences of El Nino is the movement of commercially important species, affecting both fishermen and markets. This has been observed with yellowtail, Pacific bonito and albacore tuna. Many of the rockfish species move from near shore areas into deeper or more northerly and cooler temperature waters. A recent example of this market shift can be seen with the movement of the squid market away from Californian fisheries. El Nino is poor for squid fishing, warm waters force squid deep or offshore to cooler waters greatly limiting catch. The worst El Nino on record occurred in 1997, causing massive flooding throughout Asia, resulting in death, destruction, and an increase in global food prices. The FAO’s recently published Food Outlook for 2014 forecasts a reduction in South American catches of small pelagic species, leading to higher fishmeal and feed prices. We will be sure to update you as more weather forecasts and scientific reports become available on this phenomenon.

---Thanks for joining me for the Tradex Foods "3-Minute Market Insight" This is Rob Reierson - “BUY SMART” and “EAT MORE SEAFOOD”

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