- 4 hours ago
Caviar used to be so abundant in American rivers that bars gave it away for free. Today, a single ounce can cost more than $250. Its high cost is a result of its scarcity. But over the last decade, China has exported more caviar than any other country in the world, flooding the market. So why hasn’t caviar gotten much cheaper? We visited a Michelin-starred restaurant in New York and a small American producer’s processing room to see how the tides are shifting in the industry.
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00:01After every broken fish egg is meticulously picked out,
00:05premium caviar from this California company will cost up to $182 for just one ounce.
00:13The most expensive from this company in Italy costs $262.
00:19And the best from Madagascar will run you about $282.
00:26These prices are fairly standard for premium caviar, no matter where it comes from.
00:32For most of modern history, that was simply because caviar was rare.
00:38Demand outweighed supply, which drove prices up.
00:42But over the last decade or so, that balance has started to shift as caviar from China floods the market.
00:50The small purveyors and the small producers can't survive.
00:54It's too hard to compete with China, with these other imports.
00:59So if we're talking simple supply and demand, caviar should be cheaper for consumers, right?
01:06Not quite.
01:07Caviar seems to be everywhere these days.
01:10But the prices consumers pay haven't moved much.
01:13So how did China come to dominate the caviar industry?
01:18And if there's more caviar on the market than ever, why is it still so expensive?
01:28Caviar wasn't always a luxury.
01:30To American fishermen in the early 1800s, it was literally garbage.
01:37Demand here was nearly non-existent.
01:40And supply?
01:41The rivers overflowed with sturgeon.
01:44If it didn't end up in the trash, some bars in New York served caviar sandwiches for free.
01:51Like peanuts as a salty snack to encourage beer sales.
01:54Meanwhile, European diners treated caviar as a delicacy and paid premium prices for it.
02:01By the 1870s and 80s, one New Jersey town aptly named caviar produced more caviar than any other place in
02:10the world.
02:11This was the golden age of American caviar.
02:15But it wouldn't last.
02:17Fishermen harvested millions of pounds of sturgeon with few restrictions.
02:23And populations plummeted.
02:25As sturgeon became less abundant, prices climbed.
02:29In 1885, American sturgeon roe cost the equivalent of $300 to $400 per 135-pound keg.
02:38Just 15 years later, a keg of caviar cost around $4,000.
02:44Wild sturgeon continued to dwindle throughout the 20th century.
02:51Finally, in 2006, the Convention on International Trade in Endangered Species of Wild Fauna and Flora
02:59effectively banned the trade of wild-caught caviar worldwide.
03:03Global supply shrank even further, pushing prices higher and deepening caviar's luxury status.
03:10It's an almost textbook example of an economic idea called the rarity-value thesis.
03:16Basically, the less of something there is, the more valuable it becomes.
03:21But there has to be some supply.
03:23So with traditional sources strained, producers had to figure something else out.
03:29What happened instead was people started to farm caviar, which wasn't really done before to this extent.
03:35Generally, farmed caviar is worth much less than wild because of that rarity-value thing.
03:40But after the 2006 ban, farmed caviar became a necessity.
03:47Producers now needed to build their own infrastructure and care for the animals for years before they could make a
03:53profit.
03:54At many farms, tanks have to be constantly flushed with fresh, oxygenated water.
04:00Some are built into natural bodies of water, like at Asapenser in Madagascar.
04:05The team spent months finding a lake cool enough to mimic the temperatures of the Caspian Sea.
04:14Sturgeon are slow, expensive animals to grow.
04:19Depending on the species, it can take a decade before the fish are mature enough to harvest their eggs.
04:25And they need to be fed the whole time.
04:30Asapenser spends over $130,000 a month on feed alone for about 60,000 fish.
04:38Traditionally, sturgeon are killed to harvest their eggs, so it's usually one and done.
04:47But some farms have started producing no-kill caviar, where they basically induce labor and then gently massage the eggs
04:56out.
04:56That process can be repeated every 15 months or so.
05:01The rise of farmed caviar, especially from China, ultimately caused a surge in supply, driving down wholesale prices.
05:12The wholesale price is what producers charge restaurants, distributors, and other retailers to buy their products in bulk.
05:19And it's usually lower than the retail price.
05:23That's the one customers pay.
05:25China now exports over 40% of the global market.
05:28So how has China skyrocketed to global industry dominance in such a short time?
05:35In the 1990s, China began investing heavily in sturgeon aquaculture, building large inland farms using recirculating water systems.
05:45They were controlled, scalable, and designed for long-term production.
05:49They are farming mass amounts of caviar, and that caviar is, or it can be, a lot cheaper than traditional
05:57caviar.
05:58Quality improved quickly.
05:59And by the mid-2010s, Chinese caviar was showing up in Michelin-starred restaurants.
06:07Scale is what changed everything.
06:09U.N. trade data shows China went from a negligible exporter in 2006 to the dominant supplier by 2019.
06:18In 2024, China exported 322 tons of caviar.
06:22That's double the amount of caviar it exported in 2019.
06:25So why can't other countries scale to compete?
06:29The government has really invested in that industry.
06:33So they are putting money into the farms.
06:35There is really cheap labor in China that is not available in America or in Italy.
06:41And so it's really reshaped the dynamics and the pricing of the market, in addition to just a huge boatload
06:48more of caviar entering the market.
06:50That surge in supply had a ripple effect across the global industry.
06:55Wholesale prices fell, in some markets, by more than 40 percent in less than a decade.
07:00Between 2014 and 2020, the EU reported that the average price of caviar fell from about 413 euros per kilo
07:09to 241.
07:11But lower wholesale prices didn't drop the prices for consumers in the way we might expect.
07:19What it did do was reshape the way caviar is marketed, presented and experienced.
07:26On the one hand, you have restaurants that are buying caviar cheaper, but selling it for roughly what they normally
07:33would, because people expect it to be expensive.
07:36Then you have restaurants following a new playbook.
07:39Our restaurant has the best deal for caviar.
07:43Using wholesale caviar as a marketing tool, especially on social media.
07:48In both cases, retailers rely on customers feeling that caviar is a luxury good.
07:56Perception, not scarcity, is what keeps caviar so expensive.
08:01It's going viral on TikTok and Instagram.
08:04Caviar Talk is filled with creators from all social stratospheres eating and engaging with caviar.
08:10They create aspirational content that leverages caviar's luxury status, while at the same time making it feel accessible to their
08:19followers.
08:23The Modern in New York is one restaurant fueling the trend.
08:28Chef Thomas Allen has taken the little luxury route.
08:31Do I make a ton of money off the caviar hot dogs? No.
08:34That's by design.
08:36The Modern sells two mini hot dogs topped with caviar for $39.
08:42Tom wouldn't tell us exactly how much they're marked up, but he assured us the margins were slim.
08:48I want you to have the caviar hot dogs.
08:50So I'm not going to put them at a price that's going to intimidate you or make you feel like
08:54you're boxed out of enjoying something that I think is really unique and really special.
08:58Once diners are in the door, Tom says the goal is that they'll order other higher margin items on the
09:04menu that aren't necessarily engineered with social media in mind.
09:08Viral or otherwise, these hot dogs are prepared with just as much precision as any other dish from a two
09:14Michelin starred restaurant.
09:16We're going to make the bread.
09:17We're going to make the sauce.
09:18We're going to make our mustard.
09:19We're going to pickle our shallots.
09:21We're going to do all the things we can do to perfect in a consistent way the things that we
09:26have control over.
09:26We toast it on both sides so it's warm and crispy.
09:30First goes a sauce made with fried eggs and mustard, and then we put our hot dog right on top
09:35and a big spoonful of caviar.
09:38The Modern uses Chinese caviar on its dogs.
09:41When people say Chinese caviar, the assumption is that it's cheaper or it's lesser quality.
09:46Caviar is still f***ing expensive for me.
09:49For Tom, the goal isn't to cheapen caviar.
09:52It's to reframe luxury.
09:54Keep the prestige.
09:56Remove the intimidation.
09:58To see how the dish plays with everyday diners, we sent two Business Insider reporters to the Modern.
10:05I have had caviar I think once in my life.
10:08I had it once at a wedding, but I don't remember it.
10:10Dishes like this are meant to be an entry point for the diner and their followers.
10:16The brininess that I was kind of scared of, so good.
10:20The saltiness of the caviar cuts the smokiness of the hot dog.
10:25It works really well.
10:26It's such an interesting combination.
10:29I feel like my brain is saying no, but then like my taste buds are like I want more.
10:33Have you seen the thing of people putting caviar on like Pringles and things like that?
10:38Like I love the kind of high-low.
10:40That's what I'm saying, yeah.
10:40It feels counter-intuitive in a kind of funny way.
10:43Can I have like 12 more?
10:45To go, perhaps?
10:47Those who are concerned about caviar losing its status because I put it on a hot dog haven't tried the
10:54caviar hot dog.
10:55Chef Tom's strategy only works as long as caviar still feels special.
11:00Working in fine dining, especially New York City, caviar is a pretty essential part of who we are.
11:07It's a luxury ingredient and a restaurant like ours needs to have luxury ingredients.
11:13While many restaurants have adapted to the changing caviar landscape, some small producers face a much tougher path.
11:21With more caviar on the market, they're feeling pressure to lower their wholesale prices to compete.
11:27But small farms like California Caviar Company say they can't afford to lower their prices because running a sturgeon farm
11:35is simply too expensive.
11:37We are a artisanal caviar reaching a very elite group of people.
11:45So we don't play the price game.
11:47California Caviar Company can't compete with volume.
11:50Instead, it focuses on quality.
11:54The process of getting premium caviar from the farm to your mother of pearl spoon is labor-intensive, meticulous and
12:02expensive.
12:03So the eggs come in on ice. Each bag is labeled to match the fish.
12:10This is a sturgeon's ovary. To separate it from its eggs, Deb rubs it through a screen.
12:18Every single egg is taken off by hand.
12:21This step may look simple, but it takes a bit of finesse.
12:25She doesn't want to push too hard.
12:28The more we push through the screen, the more picking we're doing, the longer the screening, and then it really
12:35breaks down caviar.
12:37By picking, she means picking out the duds.
12:40Bad eggs are removed at every stage of processing.
12:43But the goal is to retain as many as possible.
12:46We want to save the eggs because each egg is, you know, three dollars a piece.
12:52After separating the eggs from the ovary, they get washed.
12:55It still has a lot of ovarium fluid.
12:59But the minute we rinse it, the clock starts ticking and it starts to break down.
13:06Rinsing removes all the gunk that reminds you that caviar is an animal product.
13:11Sometimes the water will be gray, white, pink, red.
13:15And we want the water to be completely clear by the time we're done.
13:21So after we've gone through the screening and the washing and rinsing, this is where we dry them a little
13:28bit.
13:29Get off the excess water and pull out any of the broken eggs or any tissues that snuck through.
13:38It looks like a little shell.
13:40And so now we'll salt her.
13:44And I continue to pick as I go.
13:47You want to salt it evenly so you don't have one hot spot with too much salt in one area.
13:57And then you just want to fold it in.
14:00Some people use their hands.
14:03I find that it just warms the caviar too much.
14:07Caviar hates temperature.
14:10She'll fold until all the salt is dissolved and her instincts kick in.
14:15Just feel it.
14:16You know, when it's done, it's not done.
14:19And the caviar tends to almost push back.
14:24Right now they're like little beads against my spoon and now it starts to move like one.
14:33It's starting to release its water.
14:37It's really shiny though.
14:39It looks great.
14:41She's happy.
14:43After a taste test to check the salt level, Deb lets the caviar dry for a spell before packaging.
14:49So you want to pack it down.
14:51Get the air up.
14:56And then at the end, to make sure the air is out, you can tap it.
15:02And then they'll clean these.
15:07Clean the tins, label the tins, and have every jar and tin that will match the paperwork back to the
15:18fish to the farm in the day of the harvest.
15:21And so we wonder why is it so expensive?
15:26It's because it's a lot of work.
15:29With small producers in the market alongside bigger ones, a tiered caviar system has emerged.
15:37It's like the wine world.
15:39Caviar is here to stay.
15:40Take champagne for example.
15:43Luxury champagne can start around $150.
15:47But mid and low tier sparkling wines have expanded the market without eroding champagne status as a luxury good.
15:55Small batch American made caviar will likely always command a premium.
16:00The same way sparkling wine from the Champagne region of France will.
16:04Has champagne lost its prestige?
16:07And the answer is no.
16:09You're going to have the $1,000 bottles of champagne for those very special events.
16:16And then you're going to have sparkling wine.
16:19Caviar at scale dominates the middle of the market, while smaller producers survive by leaning harder into that top tier.
16:27That's California caviar company's bread and butter.
16:30But it also engages with the entry level market by offering fish egg products that aren't technically caviar.
16:38An ounce of roe starts at $8.
16:42Yes.
16:43Are we still indulging on $100 jars, one ounce jars of caffeine?
16:47Yes.
16:48But what you're starting to see are more roe's popping up in different ways to integrate it.
16:53Deb doesn't expect every producer will be able to find a way to engage with the changing market.
16:59You will see a consolidation because the small purveyors and the small producers can't survive.
17:05It's too hard to compete with China, with these other imports.
17:11Farming is not for the weak of heart.
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