Spanish frozen seafood group Pescapuerta, which saw its revenue grow 13 percent in 2017 to €215 million ($246 million), will “continue its plan to consolidate and source directly from the origin,” Jean Baptiste Chassin, commercial director at the company told IntraFish.

Chassin said the main focus will be to continue with its strategy of ensuring a steady supply of raw material from third-party suppliers, which he believes is the key to profitability.

“In the case of the Spanish market, in general the main challenge is the very tough competition,” said Chassin.

There are still many seafood operators in Spain doing similar things, which makes the market tough, and companies end up competing more on price than innovation.

“The classic products on the Spanish market are relatively basic products with only a few exceptions -- for seafood in Spain there is not a lot of value adding, said Chassin. “It is a vicious cycle where we all compete on price, pushing it down and down.”

So the main challenge in Spain is to be able to keep a reasonable profitability. “This is where it pays to be close to the raw material and source directly,” said Chassin.

Pescapuerta processes at origin and imports most of its products so it does not have industrial activity in Spain.

"We believe fish should be processed at origin if possible, it is better to cooperate and have good supply relationships, to try to get the best competitive position. So we will continue with our model of having good links with origins."

Pescapuerta sold 67,000 metric tons of products in 2017, of which 67 percent was fish, 25 percent was shellfish, and the rest value-added production.

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This story originally featured in IntraFish's Conxemar blog.