The most popular city this winter is Erbin, which has taken over the "monstrous wealth". The "Sichuan Red Panda" who received a warm reception in Harbin was preparing to return the gift, but discovered that he had a "high-end" specialty product like caviar at home. According to Sichuan News, on January 12, 5 large boxes and 1,200 cans of Sichuan caviar that Sichuan donated to the Harbin Municipal Bureau of Culture, Broadcasting and Tourism arrived in Harbin and were signed for locally at about 16:00.

It is reported that the company that produces the above-mentioned caviar is Sichuan Runzhao Fisheries Co., Ltd. (hereinafter referred to as Runzhao Fisheries), and its caviar brand is Fusita. On the same day, according to the official WeChat public account of Forsta Caviar, Forsta recently completed an A+ round of financing of more than 100 million yuan, exclusively invested by Feng Shang Capital.

This wave of popularity of "Erbin" in return has also made the public aware that my country actually occupies the main production of caviar in the world.

From Western imports to China’s main products, how did Chinese companies become the "invisible" overlord of the industry? Who are the "big players" in my country's caviar industry chain? As production capacity continues to expand, how will my country's caviar industry develop in the future?

Recently, reporters from the "Daily Economic News" reviewed the public transfer instructions (application draft) disclosed by Hangzhou Qiandao Lake Sturgeon Technology Co., Ltd. (hereinafter referred to as Sturgeon Technology) at the end of last year, the world leader in the caviar industry, and had exclusive conversations with Sturgeon Technology executives and researchers who have studied the sturgeon breeding industry for many years, trying to find answers to the above questions.


Image source: Sturgeon Technology official website

China accounts for more than 60% of global caviar production

"Currently, China has become the most important producer and exporter of sturgeon caviar in the world. According to statistics from CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora), China's trade volume of farmed sturgeon caviar in 2017 was 135.90 tons, accounting for 25.3% of the total global sturgeon caviar trade." According to the "China Sturgeon Industry Development Report" compiled by the China Aquatic Products Circulation and Processing Association and the National Aquatic Wildlife Conservation Branch.

This advantageous position has continued to expand in recent years. In 2022, the caviar production of a single leading enterprise, Sturgeon Technology, accounted for approximately one-third of the world's total. During the same period, Sturgeon Technology's caviar exports accounted for 68.48% of China's exports. Sichuan Runzhao, the world's second largest caviar company, accounts for 12% of global caviar production. In other words, the combined output of Sturgeon Technology and Sichuan Runzhao accounts for about 45% of the world's total. In addition to the two leading brands, there are also domestically distributedBigSmall other caviar businesses.

Today, China has become the largest producer of caviar.Relevant data shows that it accounts for more than 60% of the global market. This shows China’s dominant position in the caviar industry today.

In the last century, the caviar industry structure was very different from what it is now. In a narrow sense, caviar specifically refers to sturgeon eggs, so sturgeon is an important resource for caviar supply. The last century was an era when wild sturgeons were caught and processed into caviar. Later, with the decline of wild sturgeon resources and other factors, the market supply of wild caviar decreased rapidly. At the same time, major caviar consuming countries around the world have successively enacted legislation to ban the trade of wild caviar, and wild caviar has withdrawn from the market supply. This also provides opportunities for Chinese companies to enter the caviar market.

After the ban on wild caviar trade, artificial breeding has gradually become the mainstream method of global caviar supply. To realize artificial breeding, the key is to break through the artificial breeding technology of sturgeon.

"In the earliest days of the industry, we actually had to conquer how to make the seedlings eat artificial compound feed. If this could not be achieved, large-scale breeding would not be possible." Zhang Ying, director of the Harbin Experimental Station of the National Freshwater Fish Industry Technology System and a researcher at the Heilongjiang Fisheries Research Institute of the Chinese Academy of Fisheries Sciences, told the "Daily Economic News" reporter.

In 2002, the Heilongjiang Fisheries Research Institute achieved artificial breeding of mature Sturgeon sturgeons for the first time. Subsequently, all artificial breeding of other types of sturgeons was gradually realized in China. According to Zhang Ying, after 2006,China can basically achieve self-sufficiency in artificially cultured sturgeon seed, that is, it does not rely on wild seed or imported fry.

Also in 2006, Sturgeon Technology achieved the first export of artificially cultured caviar in my country. Now after more than ten years of development, the scale of exports is growing day by day. According to CITES data, my country's caviar export volume increased from 14.81 tons in 2009 to 291.29 tons in 2021. According to a report by EUMOFA (European Fisheries and Aquaculture Market Observatory),In 2020, about 84% of the caviar imported by the EU came from China, and about 66% and 60% of the caviar imported by the United States and Russia were imported from China respectively.

From the perspective of regional export volume, the Gongyan.com report pointed out that according to Chinese customs data, Zhejiang Province ranked first in sturgeon caviar export volume in 2021, accounting for more than 70%, and Sichuan Province ranked second, accounting for more than 19%. In addition, Fujian Province, Hubei Province, Yunnan Province, and Jiangsu Province also account for a certain proportion. It can be seen that the caviar industry is booming across the country, from the southeastern coast to the southwest inland.

Domestic caviar export prices have been rising in recent years

Caviar, with foie gras and truffles is called "Three top ingredients for Western food”, also known as "black gold". As a "luxury product", its price is high. According to media reports, the most expensive spoonful was auctioned for 200,000 yuan.But now, when you open a certain treasure, you can buy a small jar to try it for less than 100 yuan.

Today, although the price of caviar is gradually lower than before, it is still not cheap compared with other condiments.

The gross profit margin of the caviar industry is also relatively high. According to the public transfer instructions of Sturgeon Technology,In recent years, the gross profit margin of the company's caviar products has been around 70%. Fuyuan Group, another caviar company preparing to be listed on the U.S. stock market, mentioned in its prospectus that the company’s gross profit margin in the first half of 2023 will be 40%. Xu Pengfei said that the high gross profit margin of caviar companies is indeed a common feature of the industry.

What supports the high gross profit margin of caviar companies? According to Xu Pengfei, sturgeon that can be used for caviar processing needs to be cultured for 7 to 15 years before it matures. The longer breeding cycle and higher breeding risks make the investment risk in the caviar industry higher. At the same time, there are few companies with large-scale sturgeon breeding, which also allows caviar production companies in the industry to maintain a high gross profit margin as a whole.

In addition, the low "shipping volume" of caviar is also a factor. Zhang Ying made an calculation for reporters. Based on the annual export volume of 300 tons of caviar, the consumption of sturgeon is about 3,000 tons.

With the advent of the artificial breeding era, caviar production has increased significantly, and growth on the supply side will generally drive prices down. However, the reporter noticed that comparing the data disclosed in the prospectus submitted by Sturgeon Technology in 2016 and the public transfer instructions submitted when seeking listing on the New Third Board recently, the average selling price of Sturgeon Technology caviar showed a downward trend from 2013 to 2015, but in 2021, 2022 and the first half of 2023, this data showed an upward trend.

Industry trends are similar. According to the public transfer instructions of Sturgeon Technology, from January 2020 to January 2023, China’s caviar export prices rose amid fluctuations.

Behind this is the rapid growth of market demand. Xu Pengfei said: “In the past few years,The global caviar market is in a state of short supply. Our output actually cannot keep up with the demand for orders. Many overseas customers have high demand, which also provides us with higher bargaining power. "

On the other hand, it is not easy to enter the caviar industry due to factors such as quality requirements, large initial capital investment, and technical barriers. This has also created a special competitive landscape in the industry to a certain extent. As mentioned above, the top two caviar companies have occupied more than 45% of the global market, and the market concentration is high, which once again provides support for companies to improve their bargaining power.


Caviar production process Image source: Sturgeon Technology official website

Domestic consumer market and domestic brand strength need to be cultivated urgently

In fact, the special competition pattern of the caviar industry also stems from the limitations of industry scale. Burgess consulting data shows that the global caviar market will reach 3.742 billion yuan in 2022. Compared with other industry markets, the caviar market, which is less than 10 billion, appears to be niche.

How to make the “cake” bigger is the focus that caviar companies and academia are currently considering.

From the supply side, increasing production is the key to expanding the market. There is still a market gap for caviar. In the last century, when wild sturgeon fishing was not banned, the world's maximum annual caviar consumption was as high as 1,988 tons, and the export trade volume of caviar in 2022 was about 550 tons.

Zhang Ying told reporters that the team is currently conducting research on the cultivation of all-female seedlings. "Only the eggs of female fish can produce caviar. The ratio of male to female in nature is almost 1:1. If all-female breeding can be achieved in the early stage through some technical means, about 50% of breeding production costs can be saved and production efficiency can be improved."

Xu Pengfei told reporters that Sturgeon Technology is currently laying out new breeding bases and deploying production capacity in advance. "Sturgeon needs to be cultured for 7-15 years (to produce caviar), so it is equivalent to deploying production capacity at least 7 years in advance. We are still doing this to expand the reserve breeding echelon to support future market demand."


The domestic consumer market still needs to be cultivated. Image source: Sturgeon Technology official website

From the demand side, how to "educate" consumers is the key, especially the cultivation of the domestic consumer market. At present, the caviar consumer market is more concentrated overseas. Looking at Sturgeon Technology alone, more than 70% of its product revenue comes from overseas.

Opening the Chinese consumer market is not an easy task. How to adapt the imported caviar product to Chinese tastes is the key. To this end, the company has also made a lot of efforts, including promoting it to domestic high-end hotel and catering customers to replace imports with domestic products, jointly cultivating dishes with Chinese restaurants, and holding food exchange meetings.

The good news is that, thanks to the marketing promotion of Chinese caviar companies, the domestic caviar consumer market has grown significantly in recent years. Xu Pengfei told reporters that in 2022, the company's caviar products will be sold in the domestic market at more than 10 tons, which has climbed to 20 tons last year. It is expected that the sales growth rate of the domestic caviar market will reach more than 40% in the next few years.

In addition, because foreign caviar brands often have a long history and high brand awareness, domestic caviar brands are not well-known in the international market, which also affects corporate profits to a certain extent. In terms of brand building in foreign markets, Sturgeon Technology uses co-branding on the one hand, and uses its own brand sales as much as possible in emerging markets such as the Middle East. "We will also consider trying to develop more in-depth cooperation with customers in the future." Xu Pengfei said.