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SABAH, Malaysia (Reuters Life!) - Guarding rather than collecting prized swifts' nests in a limestone cave, harvester Asri Mohamed knows first-hand that Chinese consumers are shunning the delicacy as the economic recession bites.
Malaysia is the world's third largest supplier of birds' nests after Thailand and Indonesia, contributing 10 percent of the 210 tonnes, worth up to $4 billion, consumed annually by top buyers China and Taiwan.
The nests are woven by the saliva of the Asian male swift, and when prices went as high as $2,500 a kg (2 lbs) last year, teams would work round-the-clock to prise them off the walls of the 25-storey high Goamantong cave in eastern Sabah state.
Now, as the global economic recession reduces the appetite for luxury items in China and beyond, Asri and other harvesters spend most of their time outside the cave, smoking and keeping an eye out for thieves eager to make off with the nests despite the drop in market prices and demand.
"We are stuck. There are many birds' nests to collect but we have been told by our bosses to take less because prices are falling and people from China are losing interest," Asri said.
Consumers in China and Taiwan prize swifts' nests as a health tonic, aphrodisiac and status symbol, earning the delicacy its "caviar of the east" nickname. Goamantong nests are among the most exquisite in the world as there are less impurities like feathers and grit, traders say.
Even 15th century Ming dynasty records extol the value of these birds' nests that were only to be consumed by the emperor, historians say. Chinese junks traveled upstream to the Goamantong cave so frequently for the nests that locals named the waterway Kinabatangan, or Chinese river.
Swifts' nests from Goamantong cave now account for a tiny fraction of Malaysia's annual shipments of 21 tonnes, exporters said, with the bulk coming from commercial birds nest farms that connoisseurs say lack the texture of those in the wild.
In China, the nests, cleaned and boiled into a soup mostly for wedding banquets, Chinese New Year and the mid-Autumn festival, are not exactly flying of the shelves as purse strings tighten and appetites wither away for luxury food items.
"We haven't sold Malaysian birds' nest since July or August, because nobody can afford it," said Li Jie, a salesperson in the YuanDao Dry Seafood store, in Guangzhou in southern China.
"We sell mainly cheaper white bird's nest from Hainan island now," he said, which retail along with an Indonesian variety for about 4,000 to 6,000 yuan ($585-$880) per half kg.
Malaysian birds' nest sells for about 6,000 yuan per half kg.
The shop Lie Jie works in is along Yide Road, close to the Pearl River, where hundreds of dried seafood and bird's nest stores have sprung up over the past decade as living standards rose and middle-class incomes grew.
"Since 2001, the market really grew quickly," said Li Junhua, a manager in the Wing Chong Seafood Company which specializes in higher-end birds' nest products. "Even young people began to become interested in birds' nest too."
"Last year, we saw prices decrease by around 20 percent, and the financial crisis has reduced prices a little more," he said.
While the industry may not crumble with the global economic slowdown and prices are expected to pick up in 2010, the collectors at Goamantong expect to see their wages halved for the two-week harvesting seasons, held twice a year.
However, the Sabah state government which owns the cave is still seeing furious bidding for the rights to collect the nests.
"I know these workers and merchants, they will wait out the lower wages and prices. It's part of the business and life of birds' nest collecting," said Sabah wildlife department official Hussien Muin who oversees the nest collection.
Editing by Miral Fahmy