Under the new guidelines, Member States will define their own national targets through a voluntary process based on the production of “Multiannual national strategic plans”, in which countries will identify common objectives and indicators to measure progress, taking account of their relative starting positions, national circumstances, and institutional arrangements.
Multiple factors cause European aquaculture to stagnate
Aquaculture is strategically important to Europe for many reasons, including job creation and not least food security, in view of its heavy reliance on seafood imports. But there are obstacles to an easy expansion of Europe’s aquacultural strength, which includes sea bass and seabream.
EU aquaculture’s high standards put it at the forefront of sustainable development, both social and environmental. However, they make it more difficult to compete in price with third-country producers. Competition for space and access to water in coastal areas and river basins limits the establishment, development, and even maintenance of aquaculture production sites. European coastal zones are saturated with activity, and land for the expansion of aquaculture is scarce. Production costs are rising. For example, the price of fishmeal soared to a high of USD 1.907 per tonne in May 2010, although as of November 2013, the price had dropped to USD 1.549. This is still well above the average price ten years ago of ca. USD 670 per tonne.
Sea bass and seabream centre stage
According to Fishstat (FAO), in 2012, 91% of the EU’s aquaculture was made up of five species: salmon, trout, carp, sea bass, and seabream. Aquaculture in the Mediterranean region includes sea bass, seabream, mullet, sole, and eel, but sea bass and seabream are clearly the dominant species. Global production of European sea bass (Dicentrarchus labrax) in 2011 was ca. 144.000 t, valued at EUR 619 million. Turkey and Greece remain the Mediterranean region’s leading sea bass producers with 33% and 31% of weight and 29% and 31% of value produced, respectively. Turkey and Greece are followed by Spain and Italy with ca. 17.700 and 6.500 t, respectively.
Global production of gilthead seabream (Sparus aurata) in 2011 was ca. 155.000 t, valued at EUR 667 million. Greece was the world largest gilthead seabream producer, accumulating 46% of weight and 43% of value, although its position was overtaken by Turkey in 2013. In 2011, the EU produced nearly 99.000 t, valued at EUR 435 million, which represents 63.8% in weight and 65.2% in value of the global production. After Turkey and Greece, Spain is next with nearly 15.000 t. Production is concentrated in 300 small- and medium-sized enterprises, most of which combine the production of sea bass and seabream.
Seasonal demand below expectations
During the period 2008–2011, the industry had to face the challenge of falling prices resulting from oversupply and a financial crisis. Prices recovered in 2010 and 2011 as the result of business closures and lower production volume. The EU’s current debt crisis will cause production to stagnate and even recede in the EU. The ongoing debt crisis, especially in Greece, is expected to affect European production of sea bass and seabream negatively in coming years. Prices will experience volatility, as companies will be forced to sell livestock in order to acquire liquidity. Despite increased demand in the run-up to Christmas 2013, prices for sea bass and seabream did not moved as expected, with most producers reporting weaker prices during the month. The seasonal demand was less than anticipated, and supply remains ample for current needs.
Reports for the first nine months of 2013 show weaker margins and results. Volumes were up slightly, but average prices were down almost 5% compared with the previous year. Further consolidation of the sector is to be expected with private equity investors now looking for economies of scale and cost reductions as well as volume growth in the long term.
Italian producers supply the domestic market in hours
With a population of 61 million and per capita seafood consumption of nearly 26 kg, Italy is the world’s fifth largest importer of seafood. As local production decreases, Italy imports nearly 75% of its seafood demand. Most imported seafood is supplied by EU countries, with Spain as the primary supplier. According to Marco Gilmozzi, vice president of the Italian Fish-Farmers Association (API) and vice president of the Federation of European Aquaculture Producers (FEAP), Italy produces less than 20.000 t of fish, an amount dwarfed by the total European production. “What is important for us is that, for the past 20 years, the Italian market has been the main market for all of the bass and bream produced in Europe”.
Italian seafood consumption has increased by more than 50% since 1988, according to FAS/Rome, and further growth is expected over the long term. Euromonitor reports, however, that in the short to medium term, the outlook is mixed. Fresh fish consumption is expected to decline as a result of the difficult economic climate. Gilmozzi says, “We supply just 20% of the consumption. We have to produce something that is tastier, with better colour and higher quality meat. Of course, freshness is the first point. The Italian product can reach the market in two hours. From Greece it takes a day and from Turkey, several days”.
Gilmozzi explains that brand recognition is very important in Italy. “Italian consumers are attento, attentive, to what they eat. It allows us to avoid ups and downs in price”. Still, he says, prices have felt the pressure caused by strong competition from Greek and Turkish imports. At the same time, the high quality of Italian product is attracting attention in Singapore, Hong Kong, the US, and several other EU countries. “Chefs understand the difference in quality, and they are ready to pay a premium”. For Gilmozzi, growth is the most pressing problem. Europe asks us to produce more, but we have problems obtaining a licence for a new installation. Three years ago, I applied for permission to install a new farm. I'm still waiting for a reply from the local government. European producers have different costs than producers outside the EU. In the market, the cheapest normally wins over the more expensive. We can fight by offering higher quality, but we need to be sure that the rules are the same for other countries, he says.
Turkey overtakes Greece as world’s largest producer
Turkey, with a coastline of 8.333 km, 177.714 km of rivers, and a wide selection of lakes, dam lakes, ponds, reservoirs, and rivers and springs, is an ideal country for aquaculture, although per-capita consumption of seafood is only 7–8 kg. Since 1971, Turkish aquaculture has grown to more than 1.855 farms, which receive government support and help with technical development. Of these, 1.499 are inland and 356 are marine. More than two-thirds of these are small, rainbow trout farms, while sea bass and seabream farms make up 17%. A major characteristic of Turkish aquaculture is the large number of small farms producing less than 10 t per year; many farms are small-scale, family-operated and medium-sized, owner-operated farms. It is estimated that the aquaculture sector in Turkey employs ca. 25.000 people.
In 2013, Turkey surpassed Greece as the world’s largest producer of seabass and seabream. Whereas Greece’s production fell by ca. 7% to 94.000 tonnes in 2013, it is estimated that Turkey’s volume of production will exceed 100.000 t. Some suggest that it could reach 120.000 t. The Turkish industry is supported by a growing economy and government subsidies. An industry-wide marketing effort to promote seafood to new markets helped Turkish companies diversify their export destinations to include northern Europe, Russia, and the Middle East. Approximately 70–75% of the production is exported.
Water temperatures off the Turkish Aegean and Mediterranean coasts during July to September provide an ideal temperature range for growing sea bass and seabream, and production and harvesting peak during this period. It also coincides with the high tourism season in Turkey, boosting domestic demand for both species. In the high season, July to September, domestic consumption of sea bass and seabream is estimated at 2.000 t per month, with the most popular sizes for sea bass ranging from 300–400 g to 600–800 g and for seabream from 200 g to 400 g.
Small- to medium-sized cage farms sell mainly to domestic markets, as do land-based farms using earthen ponds (nearly 4.000 t in total). Pond-reared sea bass and seabream usually fetch a premium compared with the price of cage-grown fish. Exports of sea bass and seabream during July–September 2013 are estimated at about 6.000 t per month, of which 60% was sea bass. Fillets and fresh/chilled fish are the main export products.
Croatia among the pioneers of seabass and seabream farming
The national consumption of fish and fish products per person is estimated at 9 kg, which is considerably lower than the average consumption in the EU of 26 kg per person. Croatia has great potential for the development of aquaculture: tradition, high-quality water, human resources, and proximity to the EU’s largest market, Italy. Total marine production is estimated at ca. 12.000 t, of which 6.000 t is sea bass and seabream.
In the early 1970s, Croatia was a pioneer in the development of controlled spawning of sea bass and seabream, along with France and Italy. In 1981, the first industrial fishfarms (deep-water cage systems) in the Mediterranean were installed in Limski Bay, near the city of Rovinj, and a large industrial hatchery for sea bass and seabream was constructed in the city of Nin. Although marine-farming systems were established early in Croatia, this form of aquaculture was not developed significantly, because of economic, geopolitical, and market conditions.
According to Želimir Filić, who is currently vice president of the MEDAQUA (Mediterranean Aquaculture) Committee of the Federation of European Aquaculture Producers (FEAP), president of the Croatian Aquaculture Association (Chamber of Economy), and worked formerly for the aquaculture industry, these conditions have improved over the years and today Croatia has approximately 30 companies producing marine fish. The companies range in capacity from 50 t for small, family-run farms to 4.000 t for the largest companies. Most farms are located in protected bays; larger ones are in semi-offshore waters. Filić explains that three hatcheries supply ca. 60% of the fingerlings. Two have a capacity of 1–2 million fry (ca. 2 g). A larger hatchery operated by Cromaris, with a capacity of 15 million fry (2–5 g), is currently under reconstruction; it will have a capacity of 30 million fry. Approximately 40% is imported, mainly from Italy and France. Croatia’s aquaculture is subject to rigorous veterinary and sanitary control and transparent labelling and can deliver the fish within 24 hours of harvesting, including exports, after accession to the EU and procedures were simplified. Fish are sold in wholesale and retail mostly fresh, whole, but are also processed: gutted, filleted, smoked, and marinated fillets.
Spanish seabream production rebounds in 2012
The production of sea bass in Spain in 2012 was 14.270 tons, 0.7% lower than in 2011, when it was 14.367 t. The lower production in Spain contrasts with the marked increase of its production in the rest of the Mediterranean. The average first-sales price of sea bass in the Spanish market in 2012 was EUR 5.42/kg, 9.3% higher than in 2011 (EUR 4.96/kg). As in the case of seabream, there is a considerable volatility in price caused by the large number of foreign operators and traders. After three years of decline, seabream production in 2012 reached 19.430 t, up 14.8% on 2011, but below the maximum annual production of 2009 (23.930 t).
The average first-sales price of seabream in 2012 was EUR 4.31/kg, 13.8% lower than in 2011 (EUR 5/kg). The drop in price is the result of several factors: a contraction in demand in the Spanish market, the downward pressure on prices in the final stages of the value chain, and forced sales to achieve liquidity.