Thursday, March 6, 3.34 p.m. C.E.T.
The 'Marine Harvest of whitefish'
The comparisons made with salmon were plenty in this morning's whitefish panel at NAFS -- with Magdalena Lamprecht Wallhoff, VP branding and social investment at tilapia producer Regal Springs at some point even calling for a cooperational whitefish sector effort to "take down salmon."
Looking at the numbers was sobering, and Finnbogi Baldvinsson of Pickenpack made it clear that salmon is still the "king" of the seafood industry, simply by comparing average Norwegian fresh cod export prices for 2013 to average salmon export prices (NOK 8/kilo vs. NOK 50/kilo.)
Speakers agreed someone needs to step forward and become the leading consolidator -- some sort of John Fredriksen of the whitefish industry.
In his presentation, Klaus Nielsen, CEO of Espersen, said someone has to become the "Marine Harvest of whitefish."
"As Espersen we want to be part of a consolidation. We hope to lead it but if not we hope to have a vital part in it. Then we can communicate better and grow into a bigger company like the 'Marine Harvest of whitefish,'" he said.
He laid out three scenarios for the sector: Either do nothing and risk to lose more production to Asia for its growing domestic consumption.
The second scenario would be to develop "a bit," for instance new products. This would, however, not build strength and leave a few, still small low-margin business.
The third, and in his view best scenario, would be to develop new products and get stronger financially -- only then the sector can win.
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 2.37 p.m. C.E.T.
American Seafoods: Brighter 2014 for Alaska pollock
Rasmus Soerensen, executive VP sales and marketing at American Seafoods, looked back at a "tough" 2013 for Alaska pollock, but is predicting a "much brighter" outlook for the current year.
Despite a very good fishing year, the market in 2013 was tough, he said at this morning's whitefish session at NASF. It was a "financially challenging" year for many with a tough key market and a big dive in the surimi market at the beginning of the year.
This led the company to push to pin-bone out production, resulting in no inventories after the market recovered in the second half of the year.
In addition, there was a "little uncertainty" on the back of the Russian MSC certification, and concern over the low roe recovery, which was almost 20 percent less than usual, he said.
This year, however, should be different, he said, talking about a "much brighter outlook."
The A season, which is about 40 to 45 percent completed, is following the positive trend from 2013, the fish size is good -- averaging about 700 to 900 grams -- and roe recovery is back to normal, he said.
Production in Alaska so far focused on surimi, Soerensen said, while pin-bone out production is "considerably down," about 19 percent year-on-year through mid-February.
The surimi market is continuing its rapid recovery, he said, and all key markets are showing a strong upwards trend. "The market is driven by low inventories and weak supply from other surimi regions," he told the audience.
An interesting fact he pointed out is that China is now the No. 1 producer of surimi seafood, and is still growing fast, mainly for fish balls and "very much for local consumption."
Also the block market demand is developing positively, he said, which is driven by low inventories, low prices and a shift in demand from double-frozen to single-frozen -- especially in the United States. At the same time, block supply from other whitefish species is down, he said.
In Europe, sales are also good, said Soerensen, but competition between processors "continues to be unsustainable."
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 2.19 p.m. C.E.T.
Fish oil supply ‘critical’
Because the supply of fish oil is now critical, feed suppliers are desperately searching for alternatives, according to Biomar’s Rosstad.
Other fish species have been considered, but there is an “uncertainty of volume potential”, while fermented heterotrophic micro organisms command very high prices, Rosstad said.
The use of auto/phototrophic micro algae is a possibility, but it takes years to develop the volumes, he added.
The one viable option at the moment is GMO vegetable oils, said Rosstad, “this has come a far way but acceptance is a problem,” he said.
“Until alternatives are developed, there will have to be a dilution of fish oil in the feed,” he said.
“With fish oil the key question is not we will we solve it, we will, but will we solve it in time,” he asked.
“Again, I think we will.”
-- Dominic Welling
----------------------------------------------------------
Thursday, March 6, 2.12 p.m. C.E.T.
Difficult to invest in fish feed
“It is difficult to invest in this industry,” says Jan Sverre Rosstad, VP of Biomar, “it requires investment of around NOK 800 million (€96.6 million/$133.7 million) to produce 220,000 tons of feed, so there is a huge amount of money needed,” he said.
With an estimated 6 percent growth in global demand for fish feed in the near future, there are three main challenges the industry faces, Rosstad said.
Firstly making physical production and logistics capacity available, then developing the needed products, but most importantly, identifying and using the right raw materials, he said.
While vegetable raw materials are widely available, marine raw materials are in limited supply. In fact there are only around 2 million tons of fishmeal and fish oil produced each year which are certified to IFFO’s RS standards.
One other option is land animal by-products, but this is not widely accepted by the market.
Vegetable alternatives seem to offer the most opportunities, said Rosstad, there are around 300 million tons of soy produced each year for example, the only problem concerns the use of GM crops and the increase in GM plantings of soy.
“GM is a specific EU problem but there are increasing levels of GM soy being produced,” Rosstad said, which is a “real issue” for feed producers in Europe.
The feed industry has spent upwards of NOK 1 billion (€120.7 million/$167.1 million) on R&D into finding alternative fish feed ingredients since 1998, said Rosstad, but this has led to saving of NOK 3.5 billion (€422.5 million/$585 million) to farmers in 2013, he said.
In 1990, fish meal made up 65.4 percent of salmon feed products, with 24 percent fish oil and 10.6 percent vegetables. In 2013 this ratio had changed to 19.1 percent fish meal, 11.3 percent fish oil and 89.6 percent vegetables.
“Market acceptance and political acceptance are the main limiting factors for alternative raw material use,” said Rosstad.
-- Dominic Welling
----------------------------------------------------------
Thursday, March 6, 1.45 p.m. C.E.T.
Russia's Alaska pollock fillet production down, H&G up
The Russian production of pin-bone out fillet blocks is down to 10,000 metric tons in the A season of 2014, compared to 16,000 metric tons for the same period of 2013, Kristjan Hjaltason, VP of sales and marketing at $500 million turnover company Ocean Trawlers, said.
Headed and gutted (H&G) production on the other hand is up, he said, from 200,000 metric tons last year to 240,000 metric tons so far this year -- triggered by stronger prices for H&G.
This comes on the back of 29,500 metric tons of fillet production for the full year of 2013. Around 658,000 metric tons went into headed & gutted (H&G) production, he said.
This trend will most likely continue over the next years, he said, as increased production of fillets would have to come with new trawler investments.
But general opportunities he's seeing would open up by investing in new processes and product developments both at sea and on land.
At the same time, producers should take sales in their own hands -- and stop their dependence on traders and on China processing -- work with customers to develop new products and markets, build up an image of seafood in Russia, promote premium frozen-at-sea products.
In addition, all producers should get behind the Sea of Okhotsk MSC certification, as well as the outstanding West Bering Sea assessment.
Consolidation was another topic Hjaltason mentioned. There has been "considerable consolidation" in recent years due to the implementation of the quota system.
But the 10 largest players still only control 50 percent of the market, while in the United States four players control 75 percent of the total catch, with a quota of around 200,000 metric tons each.
He predicted "consolidation will continue, but it's not likely processing patterns will change in the next few years."
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 1.41 p.m. C.E.T.
Frosta revamps branded fish line
German processor Frosta recently relaunched its branded fish line, and replaced the aluminum tray with a microwaveable cardboard tray.
This will help reduce cooking time from 40 minutes in the oven to about 10 minutes in the microwave -- reduce energy usage by 60 percent and help customers save on rising energy costs in Germany, Felix Ahlers, the firm's CEO, said.
"It doesn't seem to be a very big breakthrough," he said, but it was a reaction to consumer needs, and retailers were "eager" to promote the revamped line.
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 1.36 p.m. C.E.T.
All about whitefish brands
South African producer Sea Harvest, which is celebrating its 50th year in 2014, has a market share of about 41 percent in the South African frozen fish market, thanks to its strong brand, the company's CEO Felix Ratheb said.
The company, which owns about 42,000 metric tons of the South African hake quota of 156,000 metric tons, is seeing it as the right strategy to drive sales, which in total amounted to a revenue of ZAR 1.4 billion last year.
Ratheb was hitting a spot there, as presenters and attendees in this morning's whitefish session agreed there was a general lack of brands in the whitefish sector.
During a later panel discussion, Harry Hoogendoorn, CEO of Queens -- who sat in the audience -- said the focus on private label is too strong, which is why processors couldn't "complain" about squeezed markets and razor-thin margins.
Finnbogi Baldvinsson, CEO at Pickenpack, agreed, saying currently no brands are driving the industry, especially in Europe and frugal Germany.
"Iglo [biggest branded producer] unfortunately is not investing a lot in the market," he said, and the market's offer has been evolving around the "same four standard products" for years.
Ratheb said the money lies in brands but "the trick is that you have to be the innovator," he said in the panel discussion. "In Europe, retailer brands better than actual company brands. How do you charge a premium if the quality is lower?"
Baldvinsson also welcomed German processor Frosta's move to introduce a branded fish line in summer last year. "The Frosta brand is excellent, we need more stories and we need more brands," he said.
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 12.22 a.m. C.E.T.
Norway's cod woes are Iceland's win
The seasonality of the Norwegian cod fishery is one of its biggest challenges, Tommy Torvanger, CEO at whitefish and pelagic supplier Nergaard, told the audience at NASF.
About 80 percent of Norway's cod landings are accounted for between January and April -- and Torvanger said this year it could be even higher.
While this is obviously due to spawning, governmental policies also play a role, he said.
"The guys from Iceland must be happy on how we do our fishing. Building up demand for cheap cod in the first few months, flood the market and then leave it for them after Easter," he said.
"We have to do something about it," Torvanger urged.
Nergaard's cod quota share is 30,000 metric tons this year.
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 12.19 a.m. C.E.T
Fishmeal/oil raw materials to increase
Raw material for fishmeal and fish oil is expected to increase 16 percent in 2014, from 9.6 million tons in 2013 to 11.2 million tons this year, according to Enrico Bachis from IFFO.
But due to a poor start to the fishing season both in Europe and Chile so far this year, this may not happen exactly according to plan, he added.
World fishmeal production increased slightly in 2013 compared with 2012, to hit 4.7 million tons, Bachis said, but this is down significantly from the 5.6 million tons produced in 2011.
World fish oil production is also on a downward trend, with 885,000 tons produced in 2013, down from 903,000 tons in 2012 and 1.03 million tons in 2011.
“Market forces are driving raw material allocation between direct human consumption and reduction to fish meal and oil, depending on where the demand is” Bachis said.
“But aquaculture will continue to take the lion’s share of the usage of marine ingredients,” he said.
-- Dominic Welling
----------------------------------------------------------
Thursday, March 6, 11.45. a.m. C.E.T.
Cod overtakes salmon in Europe
Cod and not salmon was the main consumed species in Europe in 2013, according to latest figures by Kontali, overtaking salmon and trout by 100,000 metric tons.
About 1.2 million metric tons were consumed last year, Kontali's Ragner Nystoel said, and was most likely triggered by the low prices and abundant supply.
Prices for cod have gone down 28 percent, while salmon prices shot up 15 percent last year, Nystoel said.
Around two thirds of global cod catches end up in Europe, he said, despite growth from Asia, the United States and Russia.
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 11.42 a.m. C.E.T
Enough fish for everyone on the planet
New fishmeal and fish oil company Pelagia can produce 1 million tons of fish per year, more or less one fish per person on planet earth, according to the company’s CEO Egil Magne Haugstad.
This is of course only a slither of the global pelagic catches which number 20 million tons per year.
“More or less half of this goes into fishmeal, while 10-12 million tons goes into direct human consumption,” said Haugstad.
Pelagia is only six weeks old, and Haugstad is officially the only employee at the moment, he said.
However, the company is a merger of Welcon Invest, Norway Pelagic, and Egersund Fisk, which when combined, means Pelagia now owns 15 processing facilities in Norway out of the 35 that currently exist in the country.
According to Haugstad, in 2013 these 15 plants accounted for 52 percent of Norway’s mackerel landings, 59 percent of the country’s herring landings, and 74 percent of capelin landings.
“Pelagia is a healthy newcomer however the consolidation is not more than 5 percent of global pelagic supply,” said Haugstad.
Referring to the current situation in Ukraine, which is a significant market for Pelagia, Haugstad said it could turn out to be challenging.
“No-one can predict what will happen in the next two weeks, it could become a cash economy which always influences markets,” he said.
“We are optimistic in the long term, but in the short term local variations are difficult to predict,” he said.
-- Dominic Welling
----------------------------------------------------------
Thursday, March 6, 11.33 a.m. C.E.T
EU continuously strong on groundfish
The EU is now taking up 45 percent of the global groundfish supply, Ragner Nystoel, CEO of Kontali Norway, said in his presentation, kicking off the whitefish panel at NASF this morning.
In 2013, European buyers snapped up more than 3 million metric tons of the around 7 million metric tons of groundfish caught last year, up 4 percent from the previous.
Europe is followed by North America, with slightly below 1 million metric ton, Asia -- including China -- with about 800,000 metric tons and South America with 500,000 metric tons.
All these markets showed growth in 2013, apart from Asia, which bought 5 percent less in 2013. However, Japan bought 10 percent less groundfish in 2013, and so did Russia with 8 percent less.
Despite a 3 percent drop, Alaska pollock remained the biggest groundfish species with about 3 million metric tons.
In the EU, Alaska pollock's market share grew slightly in 2013, now taking up 33 percent of the global supply, Nystoel said.
-- Elisabeth Fischer
----------------------------------------------------------
Thursday, March 6, 10.55 a.m. C.E.T.
Continuing price volatility for pelagics
World fish prices are set to rise strongly between now and 2022, on the back of strong demand, rising production costs and slowing production growth, according to Audun Lem, Rome branch chief at the FAO.
Fishmeal and fish oil prices are also set to rise thanks to a rapidly growing aquaculture sector, an increase in direct to human consumption, as well as limited supply, he said. However, the “long-term price differential will drive substitution away from traditional ingredients,” Lem said.
Pelagic species are produced all over the world and consumed all over the world, and pelagic prices have been increasing more than any other species over the past ten years, he said.
Consumption of seafood has been increasing worldwide, but pelagic catches, as with all capture fisheries has been stable, furthermore a higher share of pelagic catches are now going to direct for human consumption.
-- Dominic Welling
----------------------------------------------------------
Thursday, March 6, 10.52 a.m. C.E.T.
China pelagic imports jump 130%
According to the most recent FAO statistics, imports of small pelagics into China have increased 130 percent in terms of value and 35 percent in terms of volume, while 'lower-to-middle income' countries have also seen imports jump up 110 percent.
The figures are based on the percent change in imports over the four year period between 2005-2009 versus the period between 2000-2004.
In terms of value, the ‘least developed countries’, the European Union, and the US have also seen imports increase over the period, however ‘other developed countries’ and Japan have seen imports drop as much as 40 percent in the same period.
-- Dominic Welling
----------------------------------------------------------
Thursday, March 6, 10.11 a.m. C.E.T.
The elephant in the room
The North Atlantic has very healthy pelagic stocks, in fact they are at their highest level in 20 years, according to Sean O’Donoghue, CEO of Killybegs Fishermen’s Organization.
In particular, mackerel and blue whiting stocks are on the increase, he said.
Mentioning the ‘elephant in the room’, O’Donoghue said he does not expect to see a solution in regards to the dispute over mackerel stocks anytime this year. But the mackerel stocks in the North Atlantic have increased 50 percent compared with 2013, he said, and is expected to increase further.
Elsewhere, blue whiting stocks are expected to be around 1.3 million tons in 2014, almost double what they were in 2013 at 650,000 tons, according to O’Donoghue.
“All in all we are in a good position on the pelagic side of things,” O’Donoghue said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 5.33 p.m. C.E.T.
Chile finds foothold in Russia
While Norway was sleeping, Chilean salmon producers snuck into the Russian market and posted huge growth figures last year, according to Borge Prytz Larsen, director of Russian seafood importer Severnaya.
Chile's increased exports to Russia "pretty much" offset the decline in Norwegian salmon shipments, to the tune of an additional 30,000 metric tons, roughly.
Total Chilean salmonid exports to Russia grew 127 percent last year, from 28,000 metric tons in 2012 to 63,700 metric tons. Atlantic salmon exports went from 6,000 metric tons to 26,800 metric tons, an increase of 347 percent; farmed trout grew 27 percent to 27,700 metric tons; coho salmon surprised by jumping 3,762 percent to 9,100 metric tons.
"I must say I'm pretty amazed by those figures," Prytz Larsen said.
Prices of course were a big factor -- they floated at around $6.50-$7 per kilogram.
With the spike in prices over 2013, Russia's imports have in general declined, however. Prices weren't the only factor -- a major devaluation in the Russian ruble has hurt as well.
The factors have caused a "nightmare" since the Christmas season, Prytz Larsen said.
For the first time ever, retailers did agree to price increases, but it was a struggle.
"They're clear -- when the prices drop, we have to drop our pants," Prytz Larsen said.
Prytz Larsen has both bearish and bullish scenarios in mind for the Russian market. To have the bullish scenario become a reality, salmon prices need to come down to the NOK 32-35 area, and the ruble needs to strengthen some 5-10 percent.
The bearish scenario sees a flat market in 2014 and increasing problems with credit insurers.
"There are not a lot of companies with strong balance sheets that can take big losses," Prytz Larsen said. "Many are leveraged to the moon."
What will likely happen is further consolidation, already a concern among Russian competition authorities. But, Prtyz Larsen said, "it's not about collusion, it's about liquidity."
Prtyz Larsen hit only briefly on the tense situation in Ukraine, noting that imported goods costs have gone up 10-15 percent "overnight," but the situation will likely be short-lived, in his mind.
-- Drew Cherry
----------------------------------------------------------
Wednesday, March 5, 5.27 p.m. C.E.T.
Irish salmon project looking for investors
The Irish Sea Fisheries Board (BIM) is expecting the decision on the licensing of its Galway salmon project in the second quarter this year, latest Q3, its CEO Jason Whooley said.
At the same time, it is still looking for a "strategic partner" with know-how, expertise and the financial power to operate the farm.
The farm would have a capacity of 15,000 metric tons a year, a first step to overcome the "underutilized capacity" in the Irish licensing system.
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 5.23 p.m. C.E.T.
Too much tradition, too little reform?
It is always a high risk move to invoke judgment of your neighbor’s political choices, says Torben Foss, director-attorney at law PwC Seafood Centre, referring to the Common Fisheries Policy’s new market regulation.
“But if you choose to have a special policy for a specific market it must have a purpose and the means should be proportionate,” said Foss.
However there is an “endemic problem” he said. Namely that it has been hard for the seafood industry over the years to get their fair share of the price paid by consumers.
In spite of the reduced quantity of fish per capita, fish prices have generally stagnated, Foss said, suggesting the big retailers have acted as an ‘effective gate-keeper’ to the consumer.
As a fragmented industry the sellers do not have as much clout to demand higher prices from retailers than if the industry was more consolidated.
“Will the new market regulation enable the industry to finally increase fish prices?” asked Foss.
According to his assessment, the EU’s CFP has followed the path of the similar Norwegian legislation; “if the illusion is good enough, who cares about the reality,” he said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 5.05 p.m. C.E.T.
Squeezed salmon market? Cooperate, urges processor
In a direct and sober presentation to the NASF audience, Monika Siecinska-Jaworowska, CEO at Polish Suempol, criticized the lack of cooperation in a squeezed salmon market.
Last year was a difficult for everyone in the salmon processing sector, she said, with many companies reporting losses and many factories in trouble -- on the back of high salmon prices, of course.
What Siecinska-Jaworowska is missing most is collaboration between suppliers, processors and retailers. "We have problems and we'd like to speak about this," she said.
About 80 percent of the company's sales go into European exports, 60 percent to Germany only. However, so far this year exports to the German market dropped 20 percent, she said, due to "all-time high retail prices."
At discounter Aldi prices shot up from €2.99 in May 2013 to €3.29 in January this year, showing a clear relation between price and buying patterns, she said.
But "if we have an open mind we can be successful," Siecinska-Jaworowska said.
Suempol has an annual processing capacity of 60,000 metric tons of raw material, according to the presentation.
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 4.21 p.m. C.E.T.
Fisheries management can be exciting
When it is done right, measures such as the Common Fisheries Policy (CFP) can have “exciting” outcomes, according to Simon Coveney, minister for fisheries in Ireland.
“But it is up to us to make it work,” he said.
The current CFP has been “a failure in many ways” said Coveney, “it is cumbersome and no longer fit for purpose,” he said. The new CFP however, is much improved, but will always be a work in progress, he added.
One such change in the updated CFP will see more regional management of fisheries and a move away from Brussels, something which fishermen have spent years calling for, Coveney said.
However, it is up to these regional governments to make it work and if they fail to reach a consensus on how to manage their fisheries, it will be reverted back to Brussels. In a way this will work as a form of “protection” for the smaller states, which could be pressured by larger neighbours into decisions, Coveney said.
Furthermore the EU has “ambitious plans” to roll out the CFP not just to fishermen in Europe, but also to those countries which have third party agreements with the EU, Coveney said.
“We can use the size and scale of the EU to promote sustainable fisheries elsewhere,” he said.
However, even if the CFP is a success in creating more sustainable fisheries, "we cannot keep pace with seafood consumption in Europe which is increasing on average 6 percent year on year," Coveney said.
This is where aquaculture and finfish farming will have to play a major part, he said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 3.51 p.m. C.E.T.
The issue of communication
Americans are not 'foodies' and don't really have an opinion or impression about fisheries management, but they do expect fish to be available, according to John Connelly, CEO of National Fisheries Institute.
According to Connelly, the general public in the US is mainly just concerned that “food is safe, plentiful, reasonably priced.”
Therefore, fisheries management issues need to be better communicated to the US public, he said, from all corners, the fisheries institute, the government, NGOs, the media etc.
Furthermore, the seafood industry in the US needs to rethink its heavy reliance on full service restaurants, said Connelly.
At the moment, the majority of seafood is consumed when people eat out in these restaurants, but the amount of visits is declining.
Since 2006, the number of visits to full service restaurants is down by 460 million for lunch visits and 560 million for supper visits, said Connelly.
Therefore seafood must be distributed and promoted through other channels. While typically in the US pizza accounts for 1 in 4 takeaway meals eaten at home. Seafood accounts for just 4 percent, he said.
“The distribution channels for seafood in the US need to be completely rethought,” Connelly said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 3.45 p.m. C.E.T.
Chile salmon producers back to competitiveness?
The Chilean salmon industry will find back to its competitiveness in 2015-2016, Jose Ramon Gutierrez, CEO at Multiexport Foods, said.
The past eight months have seen "significant improvements" in sea lice treatment, and mortality rates went down, he said. "The industry seems to be moderating growth, creating a better environment of a more steady and sustainable environment development of our industry."
This is triggered by a "special plan" for sea lice control, including new drugs authorized by the government, treatment coordination, and changes to fish stocking planning.
In 2014, the plan is to crack down on over-regulation of the sector, current regulation of the neighborhood systems and the necessity to define dynamic carrying capacity by neighborhood and by concessions, Gutierrez said.
All this comes on the back of a difficult couple of years in 2012 and 2013, he said, when "unrealistic strong confidence" led to fast growth again, with both industry and government refraining from seeing the main structural problems.
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 3.17 p.m. C.E.T
Leroy: Adding value, expanding sustainability
Norwegian salmon producer and seafood supplier Leroy Seafood Group CEO Henning Beltestad said his company is bullish about its prospects, but is concerned about the lack of global growth in supply.
With 2 percent growth projected this year, and only 1 percent growth projected in 2015, Beltestad isn't happy.
"That's not good," he said. "We believe the market can growth by 10 percent a year at a stable price level."
"Stable" is the key word, however, Beltestad said.
"Our problem is the fluctuation," he said. "It's extremely challenging for our customers -- what should they believe?"
At NOK 26 per kilogram, "we built up a huge market globally," he said. "At NOK 52 [per kilogram], we don't see that growth."
Last year saw flatness in the European market, and consumption fell by 8 percent and 6 percent in Russia and Japan, respectively.
Some markets are showing great promise -- Brazil, the United States and China in particular -- and long-term, markets such as India will be more and more important.
To meet current demand, Leroy is investing at value-added production, and just opened its Sjomathuset plant, a development the industry can expect to see more of, Beltestad said.
The other important development at Leroy, Beltestad said, is the company's investment in sustainability. The company's Aurora division will be completely Aquaculture Stewardship Council (ASC) certified by the end of 2014, a move Leroy is seeing paying off already.
"There are a lot of customers asking for ASC, so there is a market for it," he said.
The bottom line, though, is the industry needs to get bigger.
"Who wants to be in an industry that is not growing?" he said.
--Drew Cherry
----------------------------------------------------------
Wednesday, March 5, 3.01 p.m. C.E.T
Kontali: 100,000 tons more salmon
At NASF 2013, Lars Liabo, chairman of Kontali predicted Norwegian salmon farmers would be winners -- a forecast he deemed to have become true. But what about 2014?
In total, Liabo predicts 100,000 metric tons more salmon hitting the market in 2014 -- up from 2.041 million metric tons last year. This would be a growth number of 2 percent, he said.
Norway's output would grow from 1.144 million metric tons in 2013 to 1.219 million metric tons this year, while Chile could grow from 468,000 metric tons to 481,000 metric tons.
In terms of markets, more fish could go into the EU, Liabo said, from 907,000 metric tons last year, to an estimated 958,000 metric tons in 2014. Supply to the United States is also predicted to go up from 370,000 metric tons in 2013 to 394,000 metric tons this year.
"The future is bright, especially in Norway, but surprises will always happen," Liabo concluded.
Nevertheless, it is difficult to see how salmon production could actually grow ahead to 2020.
Limits to growth in Norway are an outdated regulation system, limits per license of 780 tons biomass (MAB), and biological challenges, as well as cost in production.
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 1:15 p.m. C.E.T.
Constant drum beat
Retailers need to use more of a joined up, long term and sustainable strategy to promote seafood to consumers, Judith Batchelar, head of Sainsbury’s brands told delegates at the NASF on a panel discussion.
“There needs to be a constant drum beat of activity to change opinion over time, not just one promotion each year.
“This is something we can all do together,” she said.
It is accepted that EU consumption of fish depends a lot on advertising and leading retailers put a lot of money behind this.
But this money should be spent on telling the consumer a story, something they will remember, something personable, with a focus on provenance.
In terms of GM foods and GM products in fish feed, the retailers on the panel agreed that consumers in the EU simply are just not ready for it yet, and for now, “we can only do what we can with the situation we have got,” said Batchelar.
Hans-Jurgen Matern from Metro in Germany agreed that consumers are generally against the use of GM, but there might not be the choice to use non-GM crops in the future he warned.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 1:06 p.m. C.E.T.
Know your customers well, and your suppliers better
When it comes to traceability, personality makes it come alive for UK foodservice group M&J Seafoods.
M&J, the UK's largest seafood buyer with 11 branches, a fleet of 180 trucks and 28 percent of the foodservice market, has increased it connection with suppliers to such an extent that it knows where the vessels of its 45 UK suppliers are fishing, and when they're going to land their catch, according to M&J Seafood Director Mike Berthet.
That close connection with the harvesters has drawn more interest from chefs, who increasingly want to showcase local fish to diners.
"They really do connect with these skippers on the boats," Berthet said.
Wild fish is only part of what M&J is pushing chefs to serve, however. Berthet said M&J is pushing customers to take some 50 percent of wild fish and 50 percent farmed fish, conceding that farmed fish is an absolute for growing the seafood category.
Among M&J's locations is a purpose-built salmon processing operation that produces some 70 metric tons per week, around 80 percent of it fresh.
M&J's customers include Loch Fyne Restaurants, Harrod's, Marriott, Yo Sushi!, Greene King and John Lewis.
-- Drew Cherry
----------------------------------------------------------
Wednesday, March 5, 12.42 p.m. C.E.T.
Sustainability is not if, it’s the how
Sustainable seafood is "the right thing, they [customers] expect us to do it so we just have to do it," Julien Mahieu, category manager fresh fish at retailer Delhaize Belgium, said at the end of his talk at NASF, summing up a consumer survey conducted with shoppers.
While sustainability is a must today, and can still be seen as a commercial competitive asset for early adopters, it is certainly not a way to draw more consumers into the category, he said, calling it a "defensive approach."
Opportunities to communicate sustainability to consumers are "scarce" as shoppers attention is short.
So what's the right formula? That's a difficult one, Mahieu said, but global investments from all stakeholders could help, a harmonization of standards would too, so would increased focus on aquaculture.
But in the end there's no choice -- retailers just have to sign up for it, he said.
Delhaize BeLux, part of the New York Stock Exchange-listed Delhaize Group, is Belgium's second biggest retailer with a turnover of more than €5 billion at 600+ soft high-end stores.
Fish accounts for 4-5 percent of turnover of an average store in Belgium, with a "very low" customer penetration of 14 percent, Mahieu said.
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 12:25 p.m. C.E.T.
'We are not moving to sustainable products quick enough'
There is so much more to do when it comes to creating more sustainable fisheries, according to Kent Olsson, European sourcing manager for seafood at Swedish retailer, ICA.
“We are not moving to sustainable products quick enough,” he told delegates at NASF in Bergen.
The supermarket giant currently stocks 157 private label seafood products, making up 17,200 metric tons.
Of this it has 60 frozen products (9,500 metric tons), 19 canned products (3,700 metric tons) and 78 fresh (4,000 metric tons), Olsson said.
56 of these products are certified to the MSC label, 41 are farmed salmon products aiming to get ASC certification, while 11 are mixed products and are unable to be labeled with a sustainable logo.
The company is working on making the remaining 49 products worthy for a sustainable brand, Olsson said.
“The business has to be driven by profitability and ethical standards, said Olsson. “We must listen to consumer needs and ensure the quality and safety of products,” he said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 12:10 p.m. C.E.T.
Metro: Traceability is sustainability
Metro Group Executive Board Member Hans-Jurgen Matern wants to trim down the amount of eco-labels crowding the seafood space.
Metro, which has 2,231 locations in 32 counties and served three million people per day, sells 200,000 metric tons of seafood annually, making fish one of the most important items for them.
To ensure that it stays that way, Matern said, consumers have to have a less complex way to choose their seafood, and assurance that it is both sustainable and healthy.
When Matern gave a presentation at the North Atlantic Seafood Forum last year, there were 70 different eco-labels available. This year, there are 144.
"Ladies and gentlemen, can you tell me what for?" he asked. "I think you can earn some money starting an eco-label."
The trouble is, consumers will never understand the stories behind the eco labels -- they need to trust that retailers and suppliers have done the work, and that means traceability.
Metro has taken its traceability system "in the cloud," to help suppliers big and small give the company information, and for Metro to be able to share that with consumers.
But to truly make a simpler, more effective, less redundant traceability and sustainability system worldwide, suppliers, governments and NGO groups need to come together.
"A Metro solution alone won't work," Matern said.
-- Drew Cherry
----------------------------------------------------------
Wednesday, March 5, 12.09 p.m. C.E.T.
Private label = big business
Sainsbury's private label brand accounts for about half of its turnover, Judith Batchelar said, amounting to £10 billion a year.
The raw materials for the 12,500 products are sourced in 36 countries worldwide.
"When we talk about our brand and what our customer wants, keep in mind it is big business," she said.
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 12.06 p.m. C.E.T.
Labeling challenges? Not only for processors
New labeling requirements coming into force with new food information regulations by the end of the year, are going to be one of the big challenges to be faced by Sainsbury's and other EU retailers, Judith Batchelar, group executive direct and head of brands at Sainsbury's brand, told the audience at NASF 2014.
Frozen and previously frozen fish will need to be labeled more clearly, but consumers won't accept "fish caught two years ago which has been to China and back," she said.
"It's a big challenge for all of us," she said. Supply chain management, traceability, DNA species testing will gain importance, she said.
The retailer embarked on Fish with Thought, a long-term umbrella campaigns for all its marketing campaigns concerning fish. This includes its Switch the Fish campaign, which will take place for the third time next week, and aims to promote alternative species to consumers.
The 'Big 5' are accounting of 64 percent of value in 2014, compared to 61 percent in 2010, she said.
"This has been driven by salmon. It’s good news but from a customer interest point of view it’s not great news," she told the audience.
"We’re slowly seeing customers increasing their repertoire but it's a long-long-term campaign."
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 11.48 a.m. C.E.T
Seafood category like a sewer
“The seafood category is like a sewer,” said Jonathan Banks at the NASF in Bergen.
“What you get out of it depends on what you put into it.”
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 11.46 a.m. C.E.T
Consumers are ‘hideously confused’
A large amount of misinformation and inaccurate figures bounding about in the consumer press, means consumers are “hideously confused” when it comes to buying seafood, according to seafood consultant Jonathan Banks.
However, fish habits in the UK are changing, he said and the category is seeing slight growth.
But to make any real changes, the seafood industry must realize there are three types of people to keep happy: retailers, shoppers, consumers, Banks said.
“But it is all really about perception,” he said.
“Eighty percent of CEOs believes their brand provides their customer with a superior experience, 8 percent of customers agree.”
People prefer to invest in companies doing the right thing, Banks said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 11.40 a.m. C.E.T
Confidence and inspiration
The opportunity to boost seafood sales in the UK is there, but suppliers and retailers first of all need to dispel two main consumer ‘worries’.
Currently UK consumers buy seafood on average 1.3 times a week, but there is a large opportunity to increase this to 2 times per week and add billions in value to the category, according to newly departed Young’s Seafood CEO Leendert den Hollander.
Overall, in terms of protein, UK consumers eat fish 17 times per year, versus 23 times for poultry and 41 times for red meat, den Hollander said.
“To do this we must inspire consumers to think about fish more,” he said.
Consumers are feeling the pressure in the UK at the moment, and are constantly thinking about how to spend their disposable income.
“Value is very important to the consumer,” said den Hollander, “so we must think about how to grow the category.”
The industry has a “collective responsibility” to work together and “act for the consumer” and take away their worries about food integrity, den Hollander told delegates at NASF.
Part of this is building confidence and giving consumers inspiration, he said.
“We must make preparing fish simpler and give people new ideas of how to cook it,” he said. This includes things such as new flavors, species, recipes and packaging, for example.
“It starts and finishes with us [the industry]… the real boss is the consumer” den Hollander said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 10.37 a.m. C.E.T
Marine Harvest -- the king of everything?
A three-year wait on the Morpol deal saved Marine Harvest about €200 million, Tor Olav Troim, board member at Marine Harvest and John Fredriksen's right-hand-man said in his entertaining and impressive presentation at NASF 2014.
Outlining Marine Harvest's development from its beginnings the "small, distressed, loss-making fish farmer" Pan Fish in 2005, to salmon giant Marine Harvest with an operating cashflow of about NOK 10 million per day -- "even on Sundays" -- Troim said sometimes it's best to turn down opportunities to focus on existing operations.
Apart from the wait on Morpol, this included turning down a deal with Chilean salmon farmer Aqua Chile, he said.
"It worked," he said, adding in the course of the years they created a company from little bit more than a billion NOK to around NOK 26 billion current market cap. "It’s a pretty good move I think."
The company transformed from a high to a low-cost producer through good management and scale, Troim said. And despite cyclical prices and challenging share prices Marine Harvest will continue to "build a better company," while at the same time making even "more profit in the next cycle."
"That’s what I call a mega trend," he said.
Nevertheless, the industry will face "some really big changes" going forward. "We have to be prepared and we'll need a strong financial muscle," he said.
Size matters of course, he said, -- it creates flexibility to serve large customers better, reduces risk, and gives purchasing power. But there's no point of trying to be the "king of everything," he said.
"Some of our best decisions have been not to move."
To see Troim's full presentation click here.
-- Elisabeth Fischer
----------------------------------------------------------
Wednesday, March 5, 10.32 a.m. C.E.T.
Norway seafood enters ‘new era’
The Norwegian seafood industry has entered a new era, according to Monica Maeland, Norwegian minister of trade and industry.
The global importance of Norwegian seafood is apparent, after export value hit NOK 61 billion (€7.4 billion/$10.2 billion) in 2013, said Maeland.
Just the fact that Marine Harvest, Norway’s largest salmon producer, listed on the New York stock exchange, demonstrates how large this sector is becoming, she said.
The Norwegian government in response, plans to increase capacity for fish farming, issue new licenses, and increase the biomass of existing licenses, she said.
“But at the same time it is essential the aquaculture industry and suppliers help to reduce their carbon footprint.”
For its part, the government is improving conditions for growth in the sector, Maeland added, by reducing taxes for example and encouraging private ownership.
Elsewhere, cod also has untapped potential, Maeland said.
In 2013, while the volume of cod exports from Norway increased 38 percent, the value only grew 4 percent, but the country has to find to offer more cod during different parts of the year.
“For this we need to focus more on live storage in 2014,” Maeland said.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 10.26 a.m. C.E.T.
A moral obligation
With growing middles classes and the move from carbohydrate-based diets to protein-based diets, the growth of seafood as a raw material has become a global issue.
The consumption of seafood has already grown from 40 million tons in the 1960s to 160 million tons today, Simon Coveney, minister of fisheries for Ireland told delegates at the North Atlantic Seafood Forum in Bergen.
However, the European Union cannot even produce 40 percent of its own consumption needs at the moment.
“If the EU can’t provide for its own needs, how can it be part of global growth,” he asked.
“We need to increase to volume of seafood produced, but at the same time reduce the environmental impact.”
The demand cannot be met on land, but seafood and the oceans provide the answers, Coveney said.
The main focus should be how to meet this growth by using the ocean’s resources for farming fish in a controlled environment. But this must demonstrate sustainability, said Coveney.
“Otherwise there will be a dramatic food shortage, but we have a moral obligation to grow without damaging the environment.”
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 10.20 a.m. C.E.T.
Together we can move mountains
In the world we live in 12 percent of the population relies on fisheries and aquaculture for livelihood, yet 800 million people are going hungry every day. “This is unacceptable,” said Arni Mathiesen, assistant director general of fisheries and aquaculture at the FAO.
Speaking at NASF in Bergen, Mathiesen said the ocean’s stocks are over utilized and aquaculture still has a case to prove, but all is not lost.
“We have to gather forces and do something about it,” Mathiesen said.
Gatherings like this have the power to do something about it, together we can move mountains,” he said.
Meanwhile, Bergen is returning to its traditional position as seafood capital of the North Atlantic, added Mathiesen.
-- Dominic Welling
----------------------------------------------------------
Wednesday, March 5, 9.15 a.m. C.E.T.
Looking ahead
Guus Pastoor of the European Processors Association AIPCE just officially opened the 9th edition of NASF, saying the industry needs to look ahead, and "I hope that's something we will be able to do today and tomorrow."
Topics covered this morning will be the growing need for seafood to keep up with the growth in population, the perspective of growth in wild catch, sustainable development of the seafood sector in the EU under the new Common Fisheries Policy and the Common Market Organization, and finding answers to the questions where the EU will get its fish from.
"It's a promising program," Pastoor said.
We're looking forward to it.
-- Elisabeth Fischer
----------------------------------------------------------
Tuesday, March 4, 3.00 p.m. C.E.T.
Day Zero at NASF
NASF kicked off in Bergen, Norway, today with " Day Zero", the Marine Innovation Day.
Highlights of the first morning included Dilek Ayhan, state secretary at the Ministry of Trade, Industry and Fisheries, talking about the importance to develop knowledge on how to effectively use resources from the sea.
In 2013, Norway exported seafood worth NOK 61 billion, she said, but the country only used a small part of its resources.
"We have common challenges and through joint efforts we can increase food supplies from the sea to the world population," she said.
Later, Odd Magne Rodseth, director of aquaculture at German EW Group, which owns Aqua Gen, talked about value creation in the Norwegian salmon farming industry, saying it is not very technology-intensive, a topic many would agree with him.
The challenge is to produce more while growing sustainably. He also raised the question of genetically modified salmon.
"You are now talking a lot about genetically modified salmon. Why? Well, first and foremost, it is a simple art to genetically modify. But at present it is not much different from traditional salmon. Are genetically modified salmon a solution? The market will not have it. But what happens when the salmon are much cheaper with much lower carbon footprint than traditionally farmed salmon?"
Hans Petter Naes, head of communications at the Norwegian Seafood Research Fund, took up Minister's Thorbjorn Roe Isaksen recent statement Norway must prioritize research in areas it is good at.
"It is a clear invitation to our industry," he said.
Thor Sigfusson, CEO of the Icelandic Ocean Cluster, said in his presentation he is "a little tired" of hearing only aquaculture can increase marine food production.
-- Joar Grindheim
----------------------------------------------------------
Check back for IntraFish's latest from the 9th annual North Atlantic Seafood Forum (NASF) conference, where speakers from the world of seafood production and retail will give exclusive supply and market insight.
