As the Year of the Rooster approaches, preparations ramp up for Chinese New Year celebrations. About one fifth of the people on the planet mark the occasion with many money-stuffed red envelopes exchanged and fireworks blasting off. The holiday is the once-a-year occasion when families come together for a mix of tradition, celebration and, of course, a feast…a Boston lobster feast to be specific.
While this year’s celebrations officially kick off on January 27 and last until February 2, it is the New Year’s Eve spread that many look forward to the most. The Spring Harvest main meal is often referred to as “Nian Ye Fan” or the “reunion dinner.”
With so many Chinese citizens leaving their rural homes to work in larger cities, this is usually the one time of year when families reunite to splurge and break bread. Or, more specifically, crack some lobster tail. In China the common name for American lobster is Boston lobster, regardless whether it’s from Halifax, Maine or Boston!
It is in this spirit of reunion and abundance that no cost nor effort to obtain the best (and the most) is spared. And with more families than ever enjoying in increase in disposable income, demand for delicacies is at an all time high.
While this year’s celebrations officially kick off on January 27th and last until February 2nd, demand for lobster has skyrocketed with companies going to great lengths to cash in on high prices.
To gain exposure for their online seafood marketplace and to be known as the main supplier for this ubiquitous lobster feast, Gfresh hired a well-known streaming celebrity to deliver Boston lobster orders, alongside Gfresh CEO, Reg Tang, by Rolls Royce limousine to unsuspecting buyers, while streaming the whole experience on the celeb’s channel, which has over 100,000 viewers per day.
Reg also posed as a deliveryman and inspector, surprising loyal customers with a red carpet delivery. In a single day, 2700 boxes arrived, including Boston lobster, Dungeness crab, salmon and geoduck.
The live streaming of your life has quickly become an $11 billion dollar industry in China. Young men and women have become superstars for simply talking about their day, or drinking tea in front of a webcam. And it’s now a great way for businesses to get exposure to tens of millions of streaming fans.
But that’s not the only new thing on the block. Wholesale buyers in China are now using wholesale cross-border ecommerce platforms to circumvent the antiquated business model of emails, faxes, letter of credit, etc. that make it difficult and risky to purchase wholesale internationally.
“For Chinese New Year, we wanted to roll out the red carpet for our buyers, while also making a statement: traditional model of wholesale trade is changing fast,” says Anthony Wan, Gfresh co-founder. “We had a stellar year, exceeding 1 billion RMB ($145 million US) this year in gross market value sold through the platform and we are on track to triple our growth in 2017. As a thank you to our loyal customers who use G-auction, we will enter them into a lottery with to win a luxury car.”
Of all the elements that go into creating the Lunar New Year feast, lobster is perhaps the most anticipated. The bright red crustacean evokes thoughts of good luck; and what was once reserved for coastal families and wealthy citizens, lobster from Boston, Maine and Halifax is now sought after by more families every year.
While pork, chicken and duck are included in many meals, the star of the show is usually seafood. Fish even holds special meaning in the celebrations. For one, the pronunciation of the word “fish” makes it a homophone of the word “surpluses”, and therefore by including fish dishes in the meal, the family will then likely enjoy prosperity in the year to come. And in many households, tradition states that there must be fish leftover after the meal to symbolize the abundance and surplus of that home.
And so, with that much meaning placed on fish, how much is actually required to fulfill the demand across the country? Wholesale seafood sales work best to illustrate the answer.
Wholesale lobster supplies typically comes from two main parts of the world, the northeast coast of the U.S and the east coast of Canada. Though winter is the slowest time of year for catching the crustaceans and fishermen this year faced uncooperative weather conditions, Chinese demand takes no heed. Therefore, the cost is adjusted upward, and is felt around the world.
Boston lobster has already begun to arrive in China for this year’s celebrations. A cargo plane, taking off from the east coast of Canada, flew for 19 hours to land on January 10 in Zhengzhou, the capital of the east-central Henan province. This first large-scale shipment of the year brought 74.57 metric tons of lobster to the country.
According to China Daily, another two planes carrying large quantities of lobster will arrive before the festival begins. The crustacean will be distributed to Shanghai, Beijing, Guangzhou, Lianyungang and beyond.
Some Gfresh Boston lobster sellers have sold over 2000 boxes just in January leading up to Chinese New Year, selling over 62,000 boxes in only one and a half years.
And what about price? The cost fluctuates year upon year, and is affected by not only demand but a number of factors, including weather conditions and freight forwarding costs. This year the cost of almost all types of seafood has increased, in some cases between 50-100 percent.
According to the Malay Mail Online, Chinese silver pomfret and white-spotted rabbitfish increased from $30 per kg to $45 per kg since December, with projections set between $60 and $80 by the time the holiday begins.
Coming back to lobster, in September, 2016, Americans were paying $9 to $11 per pound for a live lobster, which is already higher than the year before. Now, a few months later, consumers can expect to pay around $13 per pound, with prices set to continue to rise until the end of January.
Sales volumes tracked by Gfresh show just how much wholesale seafood demand the company has seen during the high demand month of January. The volume of lobster bought, sold and shipped in January, 2015 compared to January, 2016 saw a 340 percent increase. To place these numbers on a timeline going back just a few years, in 2010 China imported less than a million pounds of lobster.
Lobster isn’t the only seafood commodity that sees an increase in demand and cost in January due to Chinese New Year. Geoduck, salmon and Dungeness crab are all making their way onto more tables throughout the country, reaching further inland every year.
When it comes to logistics, it’s not just seafood suppliers that need to adjust their models. Freight forwarding companies also feel the strain for a number of reasons.
For sellers servicing the country to accommodate the demand for products like fresh wholesale seafood, it’s best to keep the annual dates in mind and adjust accordingly. For seafood sellers from Canada, January used to be something of a black hole month.
Consumption was down after the North American holiday season, and freight forwarders like cargo airlines simply reduce their services during the winter months. But with this somewhat sudden uptick in demand from China, seafood suppliers need to find ways to fill the orders.
As a result, suppliers will often deal a general rate increase in shipping costs. However with Gfresh, the buyer takes on freight and customs charges and the high seasonal demand means added shipping costs are more than worth it.
Live Boston lobster needs to reach its destination within 48 hours after being removed from the water, and considering it is a 19-hour plane ride from the Atlantic coast to inland China, time is of the essence.
Efficiency and future planning are almost as valuable as the lucky red creatures themselves…as Chinese New Year won’t be the same without a Boston lobster feast, fresh or live off the plane.
While the rooster is known for being confident and perhaps a bit showy, their traits reflect the needs and expectations of the wholesale seafood industry: hardworking, resourceful, and punctual. To be able to answer the prompt demand from the land of the rooster, the seafood industry needs to look alive.
There’s no slowing down this year!