A Chinese seafood company has found itself in deep waters after blaming ‘missing’ scallops for a looming loss of up to 720 million yuan (US$114 million), drawing a sharp rap on the knuckles from state media and raising suspicions on social media…Full Article: South China Morning Post Feb 2018

Shenzhen-listed Zhangzidao Group Co, an aquatic products company, said Thursday that it will improve analysis of its inventories and improve its information disclosures…Full Article: ECNS.cn Feb 2018

Key Points

  • In late January 2018, Dalian Zhangzidao Fishery Group (aka, Zoneco Group) announced the company was expected to lose CNY 530 million to CNY 720 million [~USD 84 million to ~USD 114 million] for the financial year that ended on December 31, 2017 [i.e. 4th quarter]. The company blamed the losses on a poor inventory of Yesso scallops [Patinopecten yessoensis]. As a result, the Dalian Securities Regulatory Bureau will carry out an on-site inspection of the company.
  • In early December 2017, Zoneco (Zhangzidao) Group reportedly found no issues with its scallops during a product survey.
  • In November 2014, Zoneco (Zhangzidao) Group blamed a CNY 860 million [~USD 134 million] loss during the 3rd quarter (July to September) on poor scallop harvests. The scallop losses were attributed to an “unusual cold water mass” in the northern Yellow Sea.

ChinaAg Comments

  • In May 2016, Chinese scientists looking into open-net salmon farming within a cold mass of the Yellow Sea. A research team from Ocean University of China, Qingdao, Shandong Province, has purchased 120,000 salmon eggs from the USA to conduct their experiment. By October 2016, the research team will place the salmon fry and parr (i.e. baby salmon and juvenile salmon) in a 13 sq. km cold water mass within the Yellow Sea. By 2018, the salmon (~4 kgs each) will be fished and sold. Partnering with Qingdao’s Ocean University of China is Wanzefeng Fishery. This company will construct a two-hectare facility for salmon egg fertilization, cold storage facilities, as well as renovate a ship to assist in transporting the salmon.
  • Founded in 2001 and headquartered in Dalian, Liaoning Province, Zoneco (Zhangzidao) Group (SHE:002069) is a seafood company that markets a variety of markets including sea cucumbers, abalone, scallops, sea urchins, oysters, and lobsters. The company has been traded on the Shenzhen Stock Exchange since September 2006.

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