The US Department of Agriculture (USDA) in September announced its inability to find bids to meet a major order for 624,720 cases of canned pink salmon "due to no bids received or vendor constraints." Each case holds two dozen 14.75-ounce cans.
On Sept. 20, the agency said it was only able to fulfill 70 percent of that bid with 442,320 cases worth $25.86 million (€23.69 million). At the same average price per can, more than $10.7 million worth of canned salmon was unfulfilled from the bid.
In total, the agency was seeking nearly 15 million cans of pink salmon. All major US salmon suppliers participated in the bid, including Cooke-owned Icicle Seafoods, Ocean Beauty Seafoods, Peter Pan Seafoods and Trident Seafoods.
Not enough to go around
An executive with one major supplier told IntraFish the inability to fill bids was not due to a poor pink harvest season in Alaska this year, but instead, a response to declining consumer demand.
Alaska's pink salmon harvest of about 125 million fish is the eighth largest on record, according to McDowell Group Economist Garrett Evridge. Prince William Sound contributed the most of any region with 38 percent of the total, and Kodiak’s harvest accounted for 26 percent.
Consumers -- based primarily in the United Kingdom and Australian markets -- skew older, and have been viewed for the past several years as a dwindling demographic. Demand for other product forms such as fresh and frozen fillets and H&G for reprocessing in Asia, meanwhile, has risen.
A report released earlier this year by the Bristol Bay Regional Seafood Development Association (BBRSDA) documented the trend of Bristol Bay processors moving toward fresh and fillet production over frozen headed and gutted (H&G) fish, as well as canned salmon.
An executive with one major pink salmon canner out of Alaska told IntraFish the industry needs to increase canned production in order to supply traditional buyers.
Since 2004, Alaska Seafood Company owner Richard Hand told IntraFish, he has seen his company's pouched salmon sales soar above canned.
"The pouch is a better presentation," he said, noting the Juneau, Alaska-based company still supplies local stores with some canned salmon based on need and request, but that tourists generally prefer the pouch for its visual appeal over canned products.
Here's a look at the bid amounts the companies won to supply the USDA
- Icicle won the bid to supply the USDA with 72,960 cases worth $4.7 million (€4.29 million).
- Ocean Beauty: 199,120 cases worth $11.7 million (€10.70 million)
- Peter Pan: 115,520 cases worth $6.8 (€6.21 million).
- Trident: 54,720 cases worth $2.7 million (€2.51 million).
The USDA will distribute the canned salmon to child nutrition and other related domestic food assistance programs, with deliveries set to be made November through next March.
