Why do So Many Corals Cost More if They're Labeled as Being From Australia?

[YOYOYOReefer]

Hey man i have to buy cobalt /manganese to mix in with the steel we use to make our steel tankers. We do some nasty chemicals that would eat normal 307/407 steel., since the Ukraine war started some rare materials went from $10K a ton to $120K+ per ton . imagine explaining the price increase to your customer.. thank god only a small amount is needed per unit, but something non related sure made the grade of steel we use very expensive.

but to your point i agree looks like whatever vendor your looking at is making a nice profit, but maybe his costs are higher,, i dont know, i grow coral not import coral.

 

[Cthulukelele]

This feels like a bait question you expect a particular answer for and are hoping to get people to come on and agree with you about because you don't like that certain more expensive things are more expensive. Are there online stores that are likely lying about having Australian collected corals? Sure, but it's blisteringly obvious why corals from a developing country with little harvesting oversight would be cheaper than corals being collected from Australia.

 

[livinlifeinBKK]

This feels like a bait question you expect a particular answer for and are hoping to get people to come on and agree with you about. Are there online stores that are likely lying about having Australian collected corals? Sure, but it's blisteringly obvious why corals from a developing country with little harvesting oversight would be cheaper than corals being collected from Australia.

No, i actually posted my hypothesis earlier...I'm not hating on any store in particular, just shocked at the price differences I've noticed between pretty much anything from Australia and anywhere else. I just wanted to know if there was some specific reason.

 

[livinlifeinBKK]

Hey man i have to buy cobalt /manganese to mix in with the steel we use to make our steel tankers. We do some nasty chemicals that would eat normal 307/407 steel., since the Ukraine war started some rare materials went from $10K a ton to $120K+ per ton . imagine explaining the price increase to your customer.. thank god only a small amount is needed per unit, but something non related sure made the grade of steel we use very expensive.

but to your point i agree looks like whatever vendor your looking at is making a nice profit, but maybe his costs are higher,, i dont know, i grow coral not import coral.

You explained it very well. I'd assume your customers would understand...like i said, i was just curious if there was a specific reason unknown to me.

 

[Cthulukelele]

No, i actually posted my hypothesis earlier...I'm not hating on any store in particular, just shocked at the price differences I've noticed between pretty much anything from Australia and anywhere else. I just wanted to know if there was some specific reason.

The main reason is because Australian labor costs, collection protocols, and oversight are going to be an order of magnitude higher/more stringent than most of the other countries that are currently open for export

 

[livinlifeinBKK]

The main reason is because Australian labor costs, collection protocols, and oversight are going to be an order of magnitude higher/more stringent than most of the other countries that are currently open for export

But that still doesn't quite explain why the more corals imported from Australia the higher the cost. If it was due to labor costs or a fixed cost like that shouldn't it be relatively linear (of course inflation and recessions would affect this). The point you made about the oversight involved could be a possible explanation i suppose for higher prices although I doubt the licensing to collect is based on what they sell for or that the licensing has increased in cost so consistently. Still, that might explain it at least partially.

 

[Cthulukelele]

But that still doesn't quite explain why the more corals imported from Australia the higher the cost. If it was due to labor costs or a fixed cost like that shouldn't it be relatively linear (of course inflation and recessions would affect this). The point you made about the oversight involved could be a possible explanation i suppose for higher prices although I doubt the licensing to collect is based on what they sell for or that the licensing has increased in cost so consistently. Still, that might explain it at least partially.

I guess I don't see Australian corals costing more in my market relative to the cost of their South Asian counterparts than they did in the past. Both have increased in a relatively linear fashion. In order for the companies exporting corals from Australia to make a profit that's worth pursuing they have to charge the vendors in other countries purchasing those exports a higher cost. Those higher costs are passed onto consumers. Do they also tack on a "luxury coral" tax? Maybe, but I doubt it makes up the majority of the cost. Labor and licensing cost as well as export taxes/fees are all going to be massively higher in Australia than in most of South Asia. Collection is also going to be much more limited. I don't buy much if any Australian coral because I'm a cheapo when it comes to buying coral and Indonesian coral specifically is usually very cheap as is local aquacultured coral, but it seems pretty obvious to me why Australian exports would cost more than South Asian exports if trying to achieve the same percentages for return on investment.

 

[CoastalTownLayabout]

Ok, im pretty sure it's just a marketing thing but i like to hear everyone's opinion...So what got me thinking about this was the fact that i bought 3 mini Scolys today as well as a pretty cool Acan (got an injured Scoly for free as well so i suppose 4 Scolys in all) for only $45. I posted yesterday trying to decide which to get and had several people tell me they'd buy em all for the price they were asking. I was curious so i did a search for Scolys on an American website and honestly think mine look better tbh even though theirs costed between 8x-30x more than i paid for each. I noticed they all said the magical words "Australian" and "ultra rare" under the pictures which i can only assume must somehow make them more valuable to at least some people...i can honestly think of no rational reason why the location the corals were taken from should dictate price except for psychological marketing purposes. Is this the extent of it? Let's be real, when you buy one you have no idea where it actually came from and even if you did why should that dictate price? A beautiful coral is a beautiful coral regardless of where it came from and a bland coral is bland regardless of where it came from. I can only assume people somehow hold these labels as giving the coral dramatically increased value for no rational reason. Am i right? Is it simply marketing and therefore any coral labeled Australian should be sold for much more even if it's a total lie (you really don't know if it's a lie or not, now do you)? Can someone present a counter argument as to why being from Australian waters makes anything from a grain of sand to a coral worth more?

Mate, regulation in Aus is tight as a nuns. You’ll be needing a licence to wipe your **** here soon! It all stacks up in addition to the costs of maintaining vessels, insurance, wages, fuel, a storage and distribution facility. Then you add on the costs of export and whatever the receiving end needs to comply with and make some coin on it.

 

[albano]

Mate, regulation in Aus is tight as a nuns. You’ll be needing a licence to wipe your **** here soon! It all stacks up in addition to the costs of maintaining vessels, insurance, wages, fuel, a storage and distribution facility. Then you add on the costs of export and whatever the receiving end needs to comply with and make some coin on it.

Sooooo, you’re saying it a money thing!

 

[livinlifeinBKK]

Sooooo, you’re saying it a money thing!

It really doesn't affect me either way, i was just looking to understand the 'why'. I just bought 4 mini scolys + an Acan frag all for about $45 yesterday but I just like to try to understand and keep up with what's going on in the hobby worldwide. Btw, if you were wondering where I'm getting the information that the price of Australian corals has increased with increased imports of Australian corals I'm citing a paper by Rhyne et al.

 

[Opus]

Mate, regulation in Aus is tight as a nuns. You’ll be needing a licence to wipe your **** here soon! It all stacks up in addition to the costs of maintaining vessels, insurance, wages, fuel, a storage and distribution facility. Then you add on the costs of export and whatever the receiving end needs to comply with and make some coin on it.

I've heard from a guy I trust that Aus has changed the collection process on some corals, such as scolys, to only allowing so many to be exported per year instead of by weight, like they were in the past. He said some collectors were abusing the system and would have a permit for a ton, and all they would collect would be scolys because that was one of the main items that had a big mark-up and were in demand.

 

[Spare time]

I agree with what you're saying but how do you explain the fact that the more prevalent Australian corals become, the higher the price? Also, did you see the attached file of Scoly prices from Australia and the enormous differences in prices? Sure some of them you can chalk up to rarer color morphs but more likely is that there are multiple exporters selling to the company marketing to consumers practically marking the price wherever they please. The company selling them (I'm going to assume) aims for close to the same profit margin more or less. More important than that though since there are so many unknowns involved would be an answer to my first question which pertained to the increase in price as Australian corals became more prevalent.

One answer could be supply and demand. Another could be the correlation is unrelated or not even there at all.

 

[PeterEde]

It comes down to the cost of a collectors licence I guess and transport.
Australia have a fee for everything and bag limits. Does Indonesia charge collectors? Do they have bag limits?

 

[gbroadbridge]

But just take a look at the disparity between prices...it makes no sense...and besides if it is more expensive shouldn't the price reflect similar expenses to yield somewhat equal profit margins? I know the color variations play a part but check out this pic from online...it's insane to me what they're charging and the differences between corals taken from the same area.

They don't cost anywhere near those prices in Australia, so it's not due to cost of acquisition.
The mini scoly's in those pics are around AUD 50-80, so 40-60USD

This one above I bought from my LFS 2 weeks ago, about 2 inches across - $60

 

[livinlifeinBKK]

They don't cost anywhere near those prices in Australia, so it's not due to cost of acquisition.
The mini scoly's in those pics are around AUD 50-80, so 40-60USD

This one above I bought from my LFS 2 weeks ago, about 2 inches across - $60

Thank you for adding some insight into what they cost down there...I'm sure shipping isn't cheap by any means but I'd assume they're importing a pretty large number at a time...maybe it is just shipping...idk

 

[reefsaver]

A lot of the Coral in Australia is sustainably wild caught from different areas on the Great Barrier Reef. You can sometimes depending on the wholesaler even find out exactly where specimens are taken from with a map pin-drop.
There is a limit for licensed divers on the amount of coral they can take and it's size, on top of the logistical costs of getting it back to wholesale tanks and being prepped with special packaging, heat packs for Express international shipment. Really it comes down to Rarity, "This came from here on the Great Barrier Reef". The quality of our Coral is very high because of our very strict coral collection laws, shipment and handling, you won't really buy Coral from anywhere further away than Australia from a World Wide perspective. Your country where you live, may also have strict importation regulations which would further bump up the prices.

 

[livinlifeinBKK]

A lot of the Coral in Australia is sustainably wild caught from different areas on the Great Barrier Reef. You can sometimes depending on the wholesaler even find out exactly where specimens are taken from with a map pin-drop.
There is a limit for licensed divers on the amount of coral they can take and it's size, on top of the logistical costs of getting it back to wholesale tanks and being prepped with special packaging, heat packs for Express international shipment. Really it comes down to Rarity, "This came from here on the Great Barrier Reef". The quality of our Coral is very high because of our very strict coral collection laws, shipment and handling, you won't really buy Coral from anywhere further away than Australia from a World Wide perspective. Your country where you live, may also have strict importation regulations which would further bump up the prices.

I mean, it is what it is... I know they have a ton of expenses... i just thought it was interesting that the more Australian corals imported, the more expensive they become. Personally, I do think theres a "wow" factor of something coming from or close to the GBR so people are willing to pay more regardless. The Australian ornamental fishing industry certainly makes up for their costs as their profits increase almost yearly despite operating costs and other associated expenses. (No, I'm not complaining about them making money).

 

[gbroadbridge]

I mean, it is what it is... I know they have a ton of expenses... i just thought it was interesting that the more Australian corals imported, the more expensive they become. Personally, I do think theres a "wow" factor of something coming from or close to the GBR so people are willing to pay more regardless. The Australian ornamental fishing industry certainly makes up for their costs as their profits increase almost yearly despite operating costs and other associated expenses. (No, I'm not complaining about them making money).

What makes you believe that their profits are increasing?

Operating costs for all businesses are up about 20-25% in the last 12 months alone, and they'll keep going up for a while yet.

 

[livinlifeinBKK]

What makes you believe that their profits are increasing?

Operating costs for all businesses are up about 20-25% in the last 12 months alone, and they'll keep going up for a while yet.

Their profits and expenses are recorded like other businesses are. I looked at the report online out of curiosity

 

[gbroadbridge]

Their profits and expenses are recorded like other businesses are. I looked at the report online out of curiosity

link?