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Coldwater Prawn Forum 2017: Live is the future for Asian exports

The biennial International Coldwater Prawn Forum (ICWPF) event moves to Iceland for 2017, inviting the industry's key stakeholders to get an update on the status of the coldwater shrimp market from every angle. Keep checking back here to follow all the news.

Nov. 9, 6.32 p.m. GMT

Fresh, never frozen

The Icelandic Export Center (IEC) has started selling fresh, never frozen, coldwater prawns, proving that value-added propositions work in this market too.

Yngvi Óttarsson, CEO of IEC, explained how if a sector starts to change, you need to be prepared and adapt with it, which his company has successfully managed to do.

With a focus on the Chinese market, IEC has focused its efforts on improving quality and convenience for consumers, while at the same time securing a premium price.

It came up with the concept of “fresh, never frozen prawns “. The shrimp are brined on board the vessels and by using modified atmosphere packaging (MAP) the company is able to extend the shelf life of the product from 6 to 20 days.

Using planes, trains, trucks, “very fast ferries”, the company uses any possible way to get it quickly to the market.

“In the end we succeeded in coming up with a product which we can sell at multiples compared with if it were frozen,” said Óttarsson.

It has gone from “a wild idea” to having 200 metric tons produced and sold this year, “and we’ve only just started.”

“We must adapt to changes in world around us, be prepared, reinvent, and think outside the box of ways to add value to the consumer -- if we get it right we will be rewarded.”

For the coldwater prawns sector, it has been doing the same thing for decades, said Óttarsson, and it needs to look for ways to bring an improved value proposition to the customer. “We need more projects on new product development,” he said.

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Nov. 9, 5.58 p.m. GMT

ICWPF 2019 to take place in Canada

Wrapping up the 2017 forum for another two years, Simon Jarding revealed the next event will take place in St Johns, Newfoundland, Canada on November 14, 2019.

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Nov. 9, 5.49 p.m. GMT

Stella Polaris turns core focus on byproducts

Two years ago, Tom Harry Klausen, CEO of Stella Polaris, announced its subsidiary Marealis would be launching a breakthrough new product into the medical market by the end of 2016.

This has yet to happen, as it took “much longer than expected” but it is due to launch early next year, he said. Made from shrimp shells, the Marealis' product -- ProCardix – claims to have a positive effect on patients with pre-hypertension, which is associated with risks for cardiovascular disease. Its safety and health effects are clinically proven, although not yet fully recognized by all governments.

“It is still not in the market,” said Klausen, “but we are quite close again”. The product is approved for sale in Canada and Marealis will start to sell in January or February 2018. It is still waiting for approval in the US and EU.

Stella Polaris’s main focus is now to maximize full value from coldwater prawn by products – 60 percent of which usually go to waste.

“It takes a lot of time and money -- more money than we expected when we started 10 years ago – but the risk is worth it,” he said. There may be a higher risk, higher costs involved, but ultimately the rewards could be huge.

“It is a very lucrative market where you will end up with the byproduct becoming your main product,” said Klausen. “It is a potential game changer, the question is who will take the lead?”

Stella Polaris is now investing in two new similar products, which is now the “core of our business plan”. “The main strategy for Stella Polaris is now about creating value from byprodcuts,” said Klausen.

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Nov. 9, 5.30 p.m. GMT

Squeezing out the value

Royal Greenland CEO Mikael Thinghuus believes the future of the coldwater prawn sector will be about squeezing the value out of every single kilo caught.

“Unlike farmed shrimp, we have no options to increase volume, we are stuck with what we’ve got,” he said. But this provides opportunities as well as challenges “there is a reason gold is more valuable than silver,” he said.

The industry must therefore think about maximizing the value out of every kilo of the 225,000 metric tons available.

It is about ensuring 100 percent utilization of what the sector fishes out of the ocean. At the moment around 62 percent of what is caught is not utilized – that’s around 30,000 metric tons of head and legs and shells.

“Some is used for fishmeal, but we need more value out of that going forward.”

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Nov. 9, 5.22 p.m. GMT

Quality over quantity

For the moment, producers are focused on maximizing yield, which is easier to measure, said Mikael Thinghuus, CEO Royal Greenland, but going forward this should shift to a focus on quality.

“We need to ensure quality in production looking at every single kilo, and sell to consumers who want to pay highest price for them,” he said.

At the moment the main focus is on yield. A lot of daily operation of factories focus on yield – which is easier to measure.

Changing focus is something Royal Greenland has been attempting to do for years.

“We need to think more from a customer perspective instead of how we produce it,” he said. For example, sometimes well produced double frozen product is better than badly produced single frozen.

The main challenges are being able to focus more on better quality rather than yields, as well as better collaboration between fisheries and processors.

“It is also about finding the right customers and in that regard the industry has progressed really well away from traditional markets like the UK and most EU markets, which look for value for money, eg cheap.”

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Nov. 9, 4.54 p.m. GMT

Sending live shrimp to China

It is easy for coldwater prawn producers to sell close to home, but it is more challenging to get into more exotic markets, such as Asia, according to Mikael Thinghuus, CEO Royal Greenland, where seafood consumption is huge and the possibilities rife.

But what does it mean to get into China for example? For now this means e-commerce, said Thinghuus and it is also about the right packaging and suitable sizes of products.

If you’re selling to a family in China online for example, they will be looking for 500 grams rather than 1-5 kilos, said Thinghuus, so there are changes that need to be made to the supply chain and logistics.

“We need to be in a market closer to the Chinese, which requires investment.” The coldwater shrimp industry is categorized not by size but by being very fragmented. Royal Greenland is one of the biggest players but in the big scheme of things, is still very small.

“There is no real solution, we need a lot of money to revamp that supply chain and financing for that should come out of fishing where the most money is made,” he said.

Almost everything sold at the moment is frozen, said Thinghuus, but ultimately he believes “before we all retire” shrimp from the North Atlantic will be exported to China “in a live format."

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Nov. 9, 4.14 p.m. GMT

‘Amazing’ how little people know about prawns

Consumers, UK consumers specifically, have very little clue about prawns, or indeed how to cook or prepare them, according to CJ Jackson, CEO of The Seafood School at Billingsgate Market.

“I’m amazed about how little people know about fish – especially prawns – in so much as how to cook it, or indeed if it’s already cooked,” she said.

But it is more than this, she said. UK consumers don’t understand what a prawn is. Is it coldwater? Is it farmed? Why do Americans call it shrimp? “The consumer just doesn’t understand,” she said.

Due to this general misunderstanding, often people misuse and don’t know what to do with product.

“The understanding of prawns is so minimal.” New descriptions such as “handpeeled, coldwater” on packaging rather than simply “prawns” could be helpful.

“There is a bright future for the prawn but it’s about telling the consumer what is available and the best way to use it.”

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Nov. 9, 3.47 p.m. GMT

GAA’s Chamberlain: Coldwater shrimp is the gold standard

The Global Aquaculture Alliance’s (GAA) president George Chamberlain called the coldwater shrimp sector the “gold standard” despite the fact farmed shrimp has a larger chunk of the market these days.

When he started out in the farmed, warmwater, shrimp sector it was a niche market with little belief in its success. Nowadays though, things are different and the situation is the other way around, however consumers tend to be oblivious to all of this.

“Consumers don’t know if it’s farmed raised,” he said. “They tend to presume it’s wild caught, maybe fo the romantic notion of man against nature.”

However wild caught is still the gold standard, he said. “It [coldwater] may now be becoming the niche, but they still need to be promoted as the wonderful product they are.”

The coldwater industry could up its game, he suggested, by investing more in sustainability assurances both in the fishery and on the vessels, Chamberlain said. Innovations on things such as the use of the head and shells is important, while placing a minimum standard on quality. And then it is about marketing and “telling the story,” he said.

“I also want to see closer relations between coldwater and warmwater going forward,” Chamberlain said. “If you want to go fast, go alone, but if you want to go far, work together.”

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Nov. 9, 3.23 p.m. GMT

Coldwater shrimp taking off in China

Over the past 10 years the image of coldwater shrimp in China has seen a complete turnaround, according to Fan Xubing, general manager of Beijing Seabridge Marketing Co, which acts as the marketing agent for the Canadian Association of Prawn Producers (CAPP).

In fact it is now the world’s largest market for whole cooked coldwater shrimp, he said.

Ten years ago the shrimp had no brand, and Chinese people didn’t like it because it was neither not fresh nor live. In addition, most coldwater shrimp was sold through frozen food wholesale markets. The price was also very low was losing market share because of competition from local farmed vannamei shrimp.

Since then – from 2006 to 2016 – Canadian coldwater shrimp has gone from a non-branded product to the number one import seafood brand and bestselling seafood online in China, according to Xubing.

“Consumers have accepted coldwater shrimp as frozen-cooked shrimp and some even like it more than fresh and live shrimp,” he said. Over the ten years, coldwater shrimp’s import price has increased 283 percent with annual increase of around 11 percent.

From 80 percent of coldwater sales taking place in the wholesale, wet market, now this figure is more like 30 percent.

Around 30 percent is sold in supermarkets, 30 percent through e-commerce, and 10 percent in restaurants. And what was mainly sold to low income people in specific regions in China, is now sold mainly to middle and upper classes across the country.

What’s more, coldwater shrimp now covers all major e-commerce platforms and modern retail chains – for example, JD.com accounts for 70 percent of coldwater shrimp sales in China and it’s also been selling well on Tmall, said Xubing.

Looking towards the future it is now all about forming new marketing strategies and promotions to run alongside the surge of new sales platforms such as the boom in e-commerce.

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Nov. 9, 2.27 p.m. GMT

Taking on warmwater shrimp at its own game

It’s been a real roller coaster for the UK seafood sector since austerity hit in 2007, and while some species have had an easy ride, others have had it really tough -- like coldwater prawns, said Seafish’s Richard Watson.

People in the UK don’t embrace seafood like their continental counterparts, and consumption is clearly linked to the state of economy. “Seafood is the most expensive protein choice in the UK and shellfish the most expensive of all,” said Watson.

Coldwater prawns are also losing out heavily to their warmwater peers in the UK.

Over the past nine years volume sales of chilled coldwater shrimp are down 34.2 percent, while volume sales of frozen coldwater prawns are down 52.2 percent, according to Seafish figures.

Comparatively, over the same period, chilled warmwater sales volumes are up 14.7 percent while frozen warmwater volumes are up 55.5 percent.

But there is hope, and Watson suggested the coldwater industry should “take on warmwater at its own game”.

While it’s all about value for the UK shopper, it’s also about size and convenience. There are “real opportunities” for coldwater prawns, Watson said. For example, fast food, casual dining restaurants are growing fast in the UK and become more premium at the same time.

“This presents real opportunities, as it is the ideal format for seafood,” he said.

UK shoppers also buy on size – hence the preference for farmed warmwater prawns – so here too are opportunities.

“UK shoppers buy on size and like larger sizes,” said Watson. “So develop the product, reform it into the right size, make it easier to prepare, able to go straight to wok, or into a curry.”

Other possibilities included reforming coldwater shrimp into reformed lobster tails, prawn burgers, prawn toast, or prawn balls, Watson said.

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Nov. 9, 1.46 p.m. GMT

Keeping squeaky clean

Although the coldwater shrimp sector is generally recognized for its high standards in terms of practices and labor, “the risk is still there” and it needs to make sure it “keeps these squeaky clean standards”.

This was the advice from Melanie Siggs, associate director of Sancroft International in the United Kingdom as she delivered a speech on human rights, modern slavery and social issues within fisheries.

Citing a 2017 report which found 24.9 million people were in forced labor, Siggs said 11 percent of these were within the agriculture and fishing sectors.

She highlighted the risks associated with labor recruitment, including the use of agencies, isolation on board, and vessel standards.

“Everyone – owners, skippers, fishers – must uphold high standards of occupational safety and health and welfare, to avoid entering a slippery slope of a ‘corner cutting culture' on board,” she said.

She added “out of sight out of mind” means fishing vessels are less likely than many other work places to come under public scrutiny for abusive practices.

“North Atlantic fisheries are generally recognized for high standards, but the risk must be recognized.”

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Nov. 9, 12.33 p.m. GMT

Using tech to eliminate by-catch

Fishermen in Oregon’s pandalus jordani shrimp fishery are big fans of using technology to reduce bycatch and its paying off.

Nick Edwards, secretary of the Shrimps Producers Marketing Cooperative, Oregon Trawl Commission in the United States, explained how the fishery first made use of LED technology in its trawl nets a couple of years ago, which proved an instant success.

Out of 42 test trawls – using double rigging to compare – the fishery managed to reduce Eulachon Smelt bycatch by 90.4 percent; juvenile rockfish bycatch 78 percent and flatfish bycatch by 68.8 percent. On the other hand, shrimp loss through using the LED setup was recorded at a tiny 0.07 percent.

Now Edwards is championing even further technological advancements including the Notus Echo and the FX80 Deployment package.

The Notus Echo uses microphones to allows the wheel house to hear how many shrimp are entering the nets in real time as well as relaying information in graph form of how much is being caught.

Similarly the FX80 system uses a live camera feed to alert the skipper of what is going on in the nets.

“The technology sends real time data to the wheel house,” said Edwards. “We are now set up to harvest 10,000 pounds an hour of clean jordani shrimp with no bycatch,” he said.

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Nov. 9, 12.10 p.m. GMT

Time to move from volume to value

Despite the doom and gloom as to where the coldwater shrimp sector is it right now there are still significant opportunities and “we need to move from a heavily volume based to a value based approach,” said Carey Bonnell, head of the school of fisheries at the Fisheries and Marine Institute of Memorial University of Newfoundland and Labrador.

Bonnell said in the short to medium term at least, consolidation in the harvesting and processing sectors is likely to continue driven by demographics and raw material supply.

“In my province alone we are now down to 7 shrimp processing plants from 13, and it is likely to fall further,” he said. In addition the fisheries regime shifts coming due to climate change will require adaptive strategies, said Bonnell.

There are many opportunities out there despite the shrimp decline, as other species such as cod, redfish, and halibut are recovering, he said, but even for the shrimp sector there are value chain improvement opportunities available, you just have to be creative.

These include innovative stock assessment approaches; gear technology improvements such as use of LEDs in nets; and other quality improvements in boxing and icing for example. There are also plenty of opportunities within bio-refinery development, as well as using frozen at sea (FAS) in inshore processing sector, not to mention to the market opportunities CETA brings, said Bonnell.

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Nov. 9, 11.29 a.m. GMT

Unable to ‘de-gloomify’

Carsten Hvingel, head of research group bottom habitats and shellfish at Norway’s Institute of Marine Research, was unable to “de-gloomify” his outlook for coldwater shrimp in the North Atlantic he gave two years ago. In fact his predictions of decline appear to have played out and further declines are likely, he said.

While the decline in the East seems to have leveled off at approximately 30 percent of its peak level, there is also a similar trajectory happening in the West, he said, just with some delay.

Catches in the East have declined 70 percent from just over 150,000 metric tons in the early 2000s to around 50,000 metric tons today.

“If the West continues to parallel the East, which it has been doing, the catch needs to come down by another 85,000 metric tons,” he said.

And it is mainly to do with the rise in cod stocks, he said. “Whenever you are in doubt about shrimp and what it will do, you should open the window and take a look at what cod is doing,” he said.

He suggested the decline in Canada and Greenland will continue and maybe an increase in the Barents Sea will compensate for that, but overall the trend is still down on average 3.5 percent per year.

Once the flip back to a fish ecosystem is complete – which could happen by 2026 – Hvingel calculates a total coldwater shrimp catch of around 160,000 metric tons per year from the North Atlantic, for at least the next five years.

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Nov. 9, 10.59 a.m. GMT

Decline in shrimp fishing ‘crippling’ in some areas

The drop off of coldwater shrimp fishing -- in area 6 in particular -- has been “crippling for the industry and communities” in Newfoundland and Labrador, according to Keith Sullivan, president of the Fish, Food and Allied Workers Union (FFAW) and there have been even more plant closures this year, he said.

In shrimp fishing area 6 (SFA 6) the fish-able index has declined from 785,000 metric tons in 2006 to just 104,000 metric tons in 2016. Total allowable catch (TAC) was reduced by 42 percent to 27,825 metric tons from 2015/16 to 2016/17 and further reduced to 10,400 metric tons in 2017/18.

“So where do we go from here?” Sullivan asked. Environmental conditions and increasing predation pressure appear to be the drivers behind the decline.

“Recent environmental conditions could lead to improved shrimp production, but are unlikely to trigger rebuilding of the resource over the medium term because of the impact of high predation pressure,” he said.

In short, it may be good for migrating shrimp, but it’s also good for cod, redfish, and Greenland halibut in regions, making any stock recovery likely to be temporary.

The recent warming trend is driven by climate change and a warmer ecosystem will almost certainly affect longterm changes in commercial species, said Sullivan. The Newfoundland marine ecosystem experienced a regime shift in the 1990s which included a collapse of traditional dominating groundfish while shellfish – crab and shrimp – became the dominant group. But since the 2000s this shift reversed with shrimp declining and cod increasing.

"Recent trends suggest the ecosystem is reverting back to groundfish dominated fish community," said Sullivan.

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Nov. 9, 10.19 a.m. GMT

Shifting pole-ward

Coldwater prawn stocks are likely to move further north as sea temperatures are set to increase in the coming years.

Dr. Art Miller, senior lecturer, head of oceans and atmosphere, at the Scripps Institution of Oceanography, University of California warned that global warming will result in stronger sea temperatures, loss of sea ice, and oceans becoming more acidic – all aspects that will influence the future of the coldwater prawn industry.

With an expected increase in water temperature of 2-4 degrees Celsius and increasing ice retreat the shrimp’s southerly range is due to contract, while the northerly range will likely expand, said Miller. The shrimp’s larval development is also threatened by the warming temperatures and increased acidification. Additionally the changing conditions will lead to an increase in shrimp predation, he said.

"A general warming of 2-4 degrees, and ice retreat are predicted to increase in over the coming decades in the range and depths of coldwater prawns," said Miller.

"But coldwater prawns are a resilient species with highly variable local ecological characteristics, whose range will likely shift pole-ward.”

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Nov. 9, 09.21 a.m. GMT

No quick fixes

Iceland is a fine example of how a country can turn around its fishing industry to make it more sustainable, yet more profitable at the same time, but "there are no quick fixes and it is a long road," said Heiðrún Lind Marteinsdóttir, CEO of Fisheries Iceland.

In the 1980s Iceland was known for its overfishing, but it is a completely different story today. In 1981 the country exported 460,000 metric tons for a value of $317 million said Marteinsdóttir. In 2016 the country exported far less at 264,000 metric tons, but for more value at $382 million.

"So how did we do this? It is about good fisheries management systems, using good science, making sustainable use of resources and good decision making," she said.

One example of good management is the way in which Iceland makes use of 100 percent of the cod it lands, in various different product forms.

"There are no quick fixes, it’s a long road, but much is to do with implementing good fisheries management systems which in turn provide incentives for long terms investments."

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Nov. 9, 09.06 a.m. GMT

Is there anything left for us to learn?

This was the question posed by Royal Greenland's Simon Jarding, who is also chairman of the International Coldwater Prawn Forum, as he kicked off this year's conference.

This is the second time the event has been held outside of its original home in London and the organizers plan to continue this tradition to travel around to countries where a lot of the [coldwater prawn] business originates from.

But "is there anything left for us to learn? I hope so, and assume that’s why you all came," said Jarding.

More than 200 people are here for this event this year.

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Nov. 9, 8.55 a.m. GMT

Coldwater shrimp industry gathers in Reykjavik

The biennial International Coldwater Prawn Forum (ICWPF) is back again this year, but this time in Reykjavik, Iceland at the city's Grand Hotel, where more than 200 delegates are set to listen and learn about the most recent developments surrounding coldwater prawns and the the connected challenges and opportunities.

The event, which last took place in Copenhagen in 2015, offers an opportunity for all stakeholders in the sector to get an up-to-date status of the coldwater shrimp market, one which has seen its struggles over the past few years.

This year, as promised by Royal Greenland's Simon Jarding in 2015, “we will keep it [the event] close to our fishing grounds again".

Also two years ago Mikael Thinghuus, CEO of Royal Greenland, said that while there is still plenty of work to be done to grow markets for coldwater shrimp, and there are many challenges ahead, there are also opportunities. It will be interesting to see how things have progressed.

Offering a wide international perspective, the forum allows all stakeholders in the sector to acquire an overview of the status of coldwater prawns. It brings together professionals, specialists and traders in the industry to share information and exchange ideas regarding resources, production, opportunities, challenges and developments in the market.

Speaker highlights at this year's event include Heiðrún Lind Marteinsdóttir, from Fisheries Iceland; James Baird, from the Newfoundland and Labrador Groundfish Industry Development Council; Charles Kirschbaum, from Pacific Seafood Group; Richard Watson from Seafish, Fan Xubing, from Beijing Seabridge Marketing Co; George Chamberlain, from the Global Aquaculture Alliance; Mikael Thinghuus, CEO of Royal Greenland; Tom Harry Klausen, from Stella Polaris, Fridrik Mar Thorsteinsson CEO of Northcoast Seafoods; among many others.

ICWPF is a non-profit organization that was officially established in April 2013. Its membership is composed of processors, fisherman, fishermen’s associations, traders, scientists, organizations and individuals with a particular interest in coldwater shrimp.

IntraFish will be blogging live from the event this year, so keep checking back to get the latest information on the coldwater shrimp market.

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