Trade and Markets
Consumer survey yields vital insights in consumer habits
The second Global Fishery Forum, which was held on 13-15 September 2018 in St. Petersburg, Russia, offered an extensive programme covering various emerging topics from global fishing activities and projections for 2050, development of aquaculture, global consumer markets, technologies, and popularisation of Russian fish products.
During the second day of the Global Fishery Forum, the conference “Russian fish: a strategy for promoting Russian fish on the Russian market”, gathered experts for discussion on how to increase fish consumption. The main questions looked at understanding what Russian consumers eat and what producers are offering them, consumer awareness and the role of mass-media in this process, what can be done to stimulate consumer demand on the market, and opportunities for retail chains to increase consumption of fisheries products in the country.
Herring is the most-consumed fish in Russia
In 2016, consumption of fish and seafood products in Russia was at 21.1 kg per capita (live weight equivalent), according to the research carried out by the All-Russian Association of Fish Breeders, Entrepreneurs and Exporters (VARPE). The market size was estimated at more than 3 million tonnes of fisheries products. Herring was the leading species with 2.81 kg per capita consumption, followed by salmon species (2.73 kg per capita), Alaska pollock (2.59 kg per capita), cod (2 kg per capita) and mackerel (1.9 kg per capita). These 5 top species make up 12 kg per capita or more than 56% of all fish and seafood products in the country. Consumption of squid, shrimp and crab was about 0.6, 0.25 and 0.14 kg per capita respectively, representing about 5% of the total fish and seafood consumption in the country.
Convincing benefits for suppliers and buyers
A lot of primary food producers try to sell part of their products directly to consumers and thereby circumvent other forms of trade. What has long been common practice for agricultural products is now becoming increasingly popular for fish and seafood, too. This marketing principle has advantages for both parties: the producers get better prices and the customers get optimal freshness.
When at around 4 p.m. the "petits bateaux" return to the port of Le Guilvinec on the French Atlantic coast and the fishermen unload their freshly caught fish or langoustines they are already eagerly awaited at the quayside by locals, restaurant operators and tourists. Fish that is not snapped up immediately can be seen shortly afterwards in one of the harbour fish shops, for example "La Marée du Jour", where crowds of customers are also already waiting. Three and a half hours further north-east by car in Cancale a good half dozen colourful stalls have been set up next to the town’s beach. That is where local oyster farmers offer their specialities. It would be hard to get "creuses de Cancale" fresher, or for that matter at a lower price, than here. Fresh fish sales straight from the fishing boat are also popular along the German Baltic coast. Anyone who wants to buy freshly caught cod or herring directly from the fisherman in the harbour of Wismar has to be an early riser: the town’s remaining fishermen usually land their day’s catch around breakfast time. And a lot of German trout producers, too, sell their fish directly to their customers. This sales channel is in the meantime practically indispensable from an economic point of view. Almost all producers offer their products in farm shops or at weekly markets, both fresh and processed – mainly hot smoked. Some trout farmers even have their own snack stands or fish restaurants. Direct sales are more lucrative than supplying to wholesalers and retailers. And they enable even smaller enterprises with relatively low production volumes to stay in business.
Remaining agile in a dynamic marketplace
The Internet offers fishermen and retail shops ways to sell their catches that were unheard of a decade ago. Young (and older) consumers have quickly understood the benefits of online shopping, and vendors must keep pace with the latest, continually changing developments.
Sellers enjoy superior visibility, allowing smaller concerns to compete with larger businesses, with 24/7 exposure to a wider national, even global, audience. They also benefit from enhanced business management. By tracking data about customer purchases, sellers learn their customers’ preferences and are able to target those groups with specific offers. An Internet presence allows businesses to remain agile in a dynamic marketplace.
Two businesses, while maintaining their physical stores in Vigo, Spain, have embraced the new technology. La Pescadería de mi Barrio (My Neighbourhood Fishmonger) is a business-to-business (B2B) concern. Delmaralplato is both B2B and business to customer, selling to restaurants and consumers.
GlobalG.A.P. is one of the world’s most important certification standards for food safety. Initially, it acted as a business-to-business standard, attesting that the products of certified suppliers were safe and their production sustainable. In the meantime, however, GlobalG.A.P. is increasingly becoming a business-to-consumer standard.
Elimination of tariffs, quotas to benefit EU exporters
Combined, the EU and Japan have 9 percent of the world’s population, 28 percent of its GDP and 36 percent of its trade. Billions of euros’ worth of goods and services are traded between the two economies; hundreds of thousands of jobs are directly supported by this trade, and many more hundreds of thousands have been created by investment by the EU and Japan in each other’s economies. In seafood alone, two-way trade reached a record EUR395 million in 2016. Combined, the EU and Japan together account for over one-third of global seafood trade.
Deal to reduce consumer prices and boost trade
On 21 September 2017, the long-awaited free trade agreement between the EU and Canada, the Comprehensive Economic and Trade Agreement which the EU Parliament approved on 15 February 2017, provisionally came into force after more than eight years of arduous, detailed negotiations.
The EU-Canada trade agreement CETA, as it is known, eliminates virtually all tariffs on imports between the two economies, harmonizes and reduces trade regulations and related structural barriers, and provides a mechanism to resolve disputes concerning, trade, investment, and other economic matters. The provisional nature of CETA means that certain parts have not yet been completely agreed; these parts relate to investment protection and the Investment Court System. The rest of the agreement, including tariff reduction and removal, has entered into force.
Increasing sustainable production will call for concerted efforts
The case study “Mussel Farming” has been investigated in the framework of the European project SUCCESS (Horizon 2020) along with other aquaculture case studies. This overview of the European mussel farming sector is based on a presentation given during the workshop at Cattolica (Italy) in May 2017 and relies on preliminary outputs of the project regarding this aquaculture sector.
Globally, the production of farmed mussels has exceeded that from the wild since the end of the 1950s, and the volume share of capture fisheries fell below 10% in 2005. In the EU, mussel farming and fisheries are well-established sectors in some countries, but have exhibited a downward production trend since the beginning of the century, whereas they are still expanding in other parts of the world. The volume share of production in the EU progressively decreased from 47% to 27% over the period 2000-2015; in the meantime, China’s share rose substantially from 30% to 42% and the contribution of Chile grew from 2% to 12% thanks to the development of aquaculture (FAO Fishstat).
Global landings of small pelagics are expected to grow by seven percent in 2017 compared with 2016. The major reason for this growth is an expected higher catch of Peruvian anchovy. Catches of Atlantic mackerel and Atlantic herring are also expected to increase.
The combined increase for herring and mackerel landings in 2017 is expected to be about 4 percent more than in 2016. This could put some pressure on prices, but since the increase is relatively modest, no dramatic price changes are expected. Instead, exchange rates may play a greater role in price determination.
Finding the right niche for cold water prawns
Organized by NASF, ICWPF and Norwegian Seafood Council, the International Shellfish Event at the North Atlantic Seafood Forum offered a vision into the complex worlds of shellfish species, highlighting new trends and the ability of the shellfish industry to adapt to the volatile markets. Opened by Renate Larsen, CEO of the Norwegian Seafood Council, the session focused on the global trends in shellfish, product and market development of various shellfish categories and consumption of shellfish.
Trends in the global shellfish consumption were presented by Kristin Lien from the Norwegian Seafood Council. United States, Europe, Japan, China and the Republic of Korea are the largest destinations for shellfish species as well as the largest markets for prawns. While Europe, Spain, the UK, France and Italy are the largest consumption markets, consumption trends vary significantly for different shellfish species.
Challenges of decreasing consumption of shellfish
For example, household consumption of cold water prawns in the UK has been decreasing in 2015 and 2016, while household consumption of warm water prawns has been on the rise since 2014. Based on the EUROPANEL data, this tendency for cold water prawns is especially evident for natural, fresh cold water prawns. The decline is noticed in all kind of households, including families with and without children, retired consumers and other consumer groups. Consumption of cold water prawns remains highest among consumers over 50 and especially retired consumers over 65.
A similar trend characterizes the household consumption of scallops in France, the largest importing country of scallops in Europe. Prices increased due to a high demand for scallops coupled with limited global production; as a result, French household consumption of scallops decreased in all types of households during the past few years. However, scallops were more popular than products in the shellfish category in households of young consumers.
”There is a big potential on the markets for exclusive shellfish species, while in case of prawns, we notice a common trend that warm water prawns have become more dominant. It is a challenging situation for cold water prawns industry to find the right segments which are willing to pay extra for wild prawns in the future”, said Kristin Lien.
Cold water prawns versus warm water prawns
The conflicting situation between cold water and warm water prawns was also discussed by Henrik Espersen of Ocean Prawns. He sees that education of next-generation chefs in the UK is the key to the survival of cold water prawns in the continually changing market. Reappraisal of wild Atlantic prawns, knowledge of how to prepare and use them and awareness of how they can add value to the menu are the most important factors in reinforcing the correct knowledge about cold water prawns as well as maintaining sufficient customer demand.
While chefs can be informed about shellfish on the professional level, how much do consumers know about shellfish? Charles Boardamn, a director from Icelandic Seachill, tried to find out the who, when and why of cold water prawn consumption. According to the results from Kantar Worldpanel, occasions for consumption of cold water prawns decreased by 35% from 2013 to 2016 against a 9% growth in consumption of all prawns in the same period.
The main consumers of cold water prawns are women, and of the female prawn consumers, 66% are over 65. Although only 18% of all chilled fish is consumed at lunch, 35% of cold water prawns consumption occasions happen at lunch. Cold-water prawns are more likely than warm-water prawns to be consumed for enjoyment and health, but less likely for their practicality: for the cold water prawns consumption occasions, 84% were for enjoyment, 40% for health, and 47% for practicality. On the other hand, for warm water prawn consumption occasions, 76% were for enjoyment, 27% for health, and 67% for practicality. An interesting observation was that in half of the consumption occasions, cold water prawns were chosen by consumers who wanted a change in their dietary habits.
Appealing to younger consumers, reducing reliance on lunch occasions and highlighting shorter preparation time for healthy and tasty meals are seen as the main challenges for the cold water prawn markets, whose goal now should be to address the issue of “practicality.”
Shellfish in sushi
Detailed review of the sushi restaurant industry and use of shellfish was presented by Lise Lotte Callesøe from Denmark’s Flying Seafood Group Foods. The popularity of sushi has been increasing in Denmark for many years, and one out of 200 Danes eat sushi on an average day, according to the 2016 survey. Sushi is admired most in the Danish capital compared to other parts of the country, and young people between 15 and 34 represent the most active consumer group.
Shellfish often has a limited application in the sushi industry, compared to other fish and seafood species, so the challenge of higher inclusion in sushi is topical for shellfish producers. The assessment of restaurant categories offering sushi from both the perspectives of both the guest and the restaurant gives a better understanding of shellfish products positioning, according to Lisa Lotte. She considered examples of mainstream restaurants like sushi and buffet restaurants, along with high-end restaurants and take-away restaurants.
Sushi buffet is typically appreciated by young people and families with kids for its cheap, fast service and wide meal selection. From the restaurant’s perspective, finding “filler” products and relatively cheap substitutes is a challenge, as is using of all parts of the fish. High-end sushi restaurants are typically viewed by consumers as delicious and innovative, yet time-consuming. The main challenge for these restaurants is differentiating themselves from buffet-style sushi restaurants. Like the buffet restaurants, take-away sushi restaurants are known to consumers for their delicious, fast, easy and ready-to-eat food. Optimization of preparation process and profitability of business are the main challenges for take-away restaurants.
Integration of shellfish in sushi business highly depends on the niche of the product and type of shellfish species. Yet, the physical attributes of shellfish products and peeling processes represent common challenges for shellfish products, which are tackled by producers in different ways. “Clear vision in what part of the sushi business you want to serve, inspiration, creativity, realistic vision of your products, and creation of your own niche form success for shellfish in sushi business”, concluded Lisa Lotte.
Schillerlocken (curled strips of smoked spiny dogfish) used to be an ever-present delicacy in the counters of German fishmongers, and their presence was taken for granted. Because the dogfish stock in the North East Atlantic is overfished, however, an increasing number of grocery chains no longer lists the products of this presumably endangered species. Now the fishermen on the east coast of North America are complaining. There are still plenty of spiny dogfish there but hardly anybody wants them. What is to be done? Should dogfish products be taken out of the product range or can they remain there?