Fishing for Investment and Culinary Adventures in Thailand

Here, workers processing fish.

On a recent visit to Thailand, my investment team and I had the opportunity to visit one of the world’s largest producers of fish balls, which are typically served in a bowl of hot noodles or dipped in sauce. Fish balls are popular throughout Asia and sold in street stalls and restaurants, and a recent boom in instant noodle sales is, in turn, helping boost the fish ball business. Fish balls have a firm, jelly-like and rubbery texture when you bite into one and release a delicious, mild fish taste. As an investor (and a foodie), I was quite interested in learning both about the market for fish balls and how they’re made.

The Thai company our team visited produces over 6,000 tons of fish balls per year, and exports its products to markets around the world. In Hong Kong, a big market for fish balls, an enterprising entrepreneur had even created a fish ball vending machine. Customers were able to get a cup of fish balls by dropping a HK$5 coin or using their “Octopus card” (smart card payment system) at the vending machines.

I often wondered what fish balls were made of. At the Thai factory, I learned that the content is 90% fish with about 10% corn starch added to make a paste so the mixture can be easily formed into balls. Seasonings like salt, sugar and some vegetable grounds from carrot or seaweed are secondary ingredients.

According to the experts in such matters, a good fish ball should have an elastic (bouncy) and fluffy texture and the strong taste of fish. They insist that only certain specific kinds of fish make superior fish balls, but the supplies of such fish are increasingly rare and more expensive, moving up in price more than two or three times in recent years.

A wide variety of fish can be used in fish balls, including mackerel and snapper. In Thailand, purple-spotted big-eye fish from the Gulf of Thailand are the main fish source. The fish are usually about 30 cm (12 inches) in length, have very rough spiny scales and unusually large eyes, and are a mix of not only purple colors but also bright red and other color patterns.

My team and I get a close look at one stage of fish ball processing.

I was surprised by the degree of automation in the factory, but that makes sense given the tremendous volume being produced. Our team’s tour of the factory started at the beginning of the process where truckloads of fish were unloaded onto factory tables. Next, workers have the unenviable task (not for the squeamish) of removing the heads, entrails, skin and bones and separate out the fish meat for fillets. I had assumed the entire fish would be ground up to make the fish balls, so I was happy to see that they use only the meat. Next the fish fillet was minced, ground and mashed thoroughly. During this process, workers added salt, pepper and corn starch to produce a fish paste, and then incorporated various seasonings. Machines then formed the paste into evenly sized balls, finally dropping them into boiling fish stock one-by-one, resulting in a firm, round white ball. The factory also produces fried fish balls by dropping the finished white balls into hot oil and cooking them until a golden brown.

The experts also say that only fish balls made by hand exclusively with fresh fish are the best, but in this day and age, economics is driving the business toward mechanical production. These may not be as good as the traditional handmade ones, but are still certainly delicious—to which I can personally attest.

The final product of our recent Thai factory visit – delicious fish balls, ready to eat!

It’s not always nice to know what you are eating, but this time, it was. And, it’s nice to know you can put your money where your mouth is, too. After this experience, I’ll enjoy my next bowl of noodles and fish balls much more. I’ve included some photos of my visit, which was certainly enlightening for me in my search for investment opportunities—and culinary adventures.

Read more about our team’s investment outlook in “Thailand: Land of Smiles” on my blog.

Important Legal Information

Dr. Mobius’s comments, opinions and analyses are for informational purposes only, may change without notice, and should not be considered individual investment advice or a recommendation to invest in any security or to adopt any investment strategy. Information contained herein is not a complete analysis of every material fact regarding any country, region, or market. All investments involve risks, including possible loss of principal. Investments in foreign securities involve special risks including currency fluctuations, economic instability and political developments. Investments in emerging market countries involve heightened risks related to the same factors, in addition to those associated with these markets' smaller size, lesser liquidity and lack of established legal, political, business and social frameworks to support securities markets.