FILE PHOTO: Dried sea cucumbers from North Korea being sold at a market in Dandong, China. (Daily NK)
While North Korea is prohibited from exporting fishery products under United Nations Security Council sanctions, seafood from the North, including pricey dried sea cucumbers, are still openly sold in Chinese marketplaces as traders smuggle the products across the border ahead of Chinese New Year.
A source in China, who requested anonymity for security reasons, told Daily NK recently that North Korea’s Rungra 88 Trading Company has been actively smuggling North Korean dried sea cucumbers into China ahead of Chinese New Year, the country’s biggest holiday.
Rungra 88 offered the following prices for a kilogram (2.2 pounds) of dried sea cucumbers to Chinese buyers: $450 for 50 sea cucumbers, $400 for 80 sea cucumbers, $350 for 120 sea cucumbers, $300 for 150 sea cucumbers and $270 for 200 sea cucumbers.
Chinese buyers accepted those terms, and the largest Chinese sea cucumbers (50 per kilogram) are reportedly currently retailing in China for 2,800 to 3,000 yuan ($385 to $413) per jin (a common unit equivalent to 500 grams or 1.1 pounds) at a market in Dandong, in China’s Liaoning province.
Considering that Chinese dried sea cucumbers of the same size and weight were selling for 2,500 yuan ($344) at the same market, the North Korean products are selling for a premium price.
Quality perceptions drive premium pricing
North Korean fishery products are widely regarded as being wild-caught and high quality in the Chinese market. That has led Chinese merchants who trade in North Korean dried sea cucumbers to promote them as being “caught in waters almost entirely free of pollution” and “healthier than farm-raised sea cucumbers.”
While North Korean dried sea cucumbers are highly regarded by Chinese consumers, they do not control a large market share. The reason is that Chinese sea cucumbers are also available at various qualities and price points in the Chinese market.
And since North Korean dried sea cucumbers carry the stigma of being a sanctioned product, it is not feasible to move them in large quantities inside China.
But after learning that North Korean dried sea consumers are viewed favorably in the Chinese market, North Korean trading companies have been trying to sell product at much higher prices than usual.
For instance, Rungra 88 is reportedly attempting to maximize its profits by maintaining several Chinese buyers and varying the asking price with the order size. With demand for North Korean dried sea cucumbers on the rise before Chinese New Year, Chinese buyers have generally been accepting trading companies’ asking price.
“There are obviously some customers who can tell the difference between North Korean and Chinese sea cucumbers and who make a point of buying the North Korean stuff. So North Korean sea cucumbers continue to sell even when North Korean traders jack up the prices,” the source said.
Although United Nations Security Council Resolution 2371 prohibits the supply, sale and transfer of North Korean fishery products, products that are explicitly labeled as being from North Korea are still being openly sold on the Chinese market both online and offline.
Daily NK reported last year that North Korean dried sea cucumbers collected in the Yellow Sea, off the coast of North Pyongan and South Hwanghae provinces, was being frequently traded in Changbai county, Jilin province, and Dandong, Liaoning province, on China’s border with North Korea.
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