Monday, April 20, 16.05 pm CET
Need to focus on consumers
There is a revolution going on in the tuna retail sector, according to Willem Huisman CEO of Anova Seafood.
Millenials have now become the decision makers and these 30-plus-year-olds are less loyal to brands and are more quality minded, he said.
Millenials are the 'Google generation', so digitalization is a main driver of changes in the industry, making it more important for the entire supply chain to be more transparent.
"In this sense, transparency, creativity and innovation have become increasingly important in the industry," said Huisman.
“These millenials are very important. They are always trying different and new things,” he said. “They are also more interested in convenience, health and responsible consumption.
“We need to focus more on the need of the consumer rather than thinking about ‘more, more, more’”
Huisman believes consumer behavior, supply chains and distribution will dramatically change in the next decade and companies need to innovate to maintain their position.
For the tuna industry there are many opportunities in creating innovative responsible tuna products, but responsible business is a prerequisite in creating these innovative opportunities.
The industry needs to become more open and adapt itself to the changing requirements of the environment. For example, the business model will change from being a commodity, stock driven supply chain, unseen for a major part, to a demand driven supply chain with full transparency.
It will shift from specifications focused on the intrinsic value of the product to specifications based on full understanding of the market and environment.
“The tuna business will only develop by consumers regaining confidence in the supply chain, including management of its resources,” said Huisman.
In addition, retailers will seek innovation from modern supply chains, which opens up a great opportunity for niche brands and private labels. It will also open up a great opportunity for the artisanal industry, he said.
-------------------------------------------------------
Monday, April 20, 15.35 pm CET
Sustainable tuna can be sustainable business
Unil, the private label and import division of Norway’s largest retailer, NorgesGruppen, and the biggest supplier of canned tuna in Norway is risking losing its most price sensitive consumers by committing to sustainable tuna.
Retail sales of canned tuna in Norway climbed 17 percent between 2013 and 2014 to 2,256 metric tons, and the market is dominated by private label (94%), according to Einar Mosvoll, senior procurement manager at Unil.
“And value added tuna is increasing,” he said. However, the company is actively searching for more suppliers who can demonstrate sustainability. There is currently only one MSC-certified product on the shelves in the Norweigan market, Mosvoll said.
The company’s policy for sustainable fish states that it will only use suppliers that can document sustainable tuna with a low environmental impact, and that it will not market tuna until further notice.
While not all suppliers have to be certified, they have to demonstrate they are at least working with an NGO or seeking improvement, according to Bjart Thorkil Pedersen, CSR manager at Unil.
Nevertheless, will consumers pay a price premium for sustainably sourced tuna in Norway?
According to Mosvoll, price promotions boost sales, and by increasing the price for MSC-certified products, “we risk losing the most price sensitive customers.”
Is sustainability added value to the consumer?
“The consumer has little knowledge of sustainable tuna today – we have to educate them. But I believe sustainable tuna is a sustainable business.”
-------------------------------------------------------
Monday, April 20, 15.10 pm CET
EU and Africa benefit one another, and will not compete
The EU market is an “essential” part of the production of African tuna canneries, according to Mohamed Khachab, CEO of Ivory Coast-based Thunnus Overseas Group (TOG), with many products destined for France, UK, Italy, Spain, Germany and northern European countries.
At the same time, Europe acts as the main supplier for these African canneries, he said. In this way it is unlikely the fast growing African market will compete for tuna with Europe.
“For many years, the situation is due to the zero duty trade status tariffs for canned tuna on the EU market,” he said.
Instead Khachab believes Africa actually represents an opportunity for the development of the canned tuna market with adapted products.
-------------------------------------------------------
Monday, April 20, 14.45 pm CET
Vietnam close to reaching FTA with EU
After twelve rounds of negotiations, a free trade agreement (FTA) between the European Union (EU) and Vietnam, “seems in reach,” according to Nicolas Dross head of the fisheries team at the directorate general for trade of European commission in Brussels.
“As with many things like this we don’t know exactly when it will end, but I can say it is a major negotiation, close to concluding.”
Dross said trade in tuna products with the EU is facing systematic changes which might profoundly affect the industry, bringing both challenges and opportunities.
There has been a multiplication of FTAs on a global level over the last few years. In 2013, for example, the EU launched a raft of large scale negotiations with countries including the US and Japan.
There are also ongoing negotiations with countries such as Mercosur, Thailand (now on hold) and Vietnam, as well as recently concluded ones with Korea (in 2011), Canada (2014), and the Andean community. The first wave with Peru and Colombia, took place in 2013, while Ecuador concluded last year.
“Some of these are important players in the fisheries industry and the tuna sector in particular, whether role as resource rich fishing nations or as competitive processors.”
Along with FTAs there are 3 other main types of import duties – most favored nation treatment (MFN); generalized system of preferences (GSP); and economic partnership agreements (EPA).
Members of the World Trade Organization (WTO) agree to award MFN status to each other, with duties of 24 percent for canned tuna and tuna loins.
The GSP gives countries a reduction of MFN duties by 3.5 percent, so 20.5 percent in terms of tuna loins.
China, Ecuador and Maldives were taken out of the GSP from Jan 1, 2015, while as of December 2014 Philippines was entered into the GSP+ scheme – the special incentive arrangement for sustainable development and good governance – which means it can export tuna duty free to the EU.
Equally important for tuna sector is a cluster of EU development-orientated negotiations known as economic partnership agreements (EPAs) with African, Caribbean and Pacific countries.
“Three quarters of tuna cans now enter the EU duty free though FTAs, EPAs and GSP+” said Dross. "And a quarter are liable for duties either at 20.5 percent through the GSP or at 24 percent."
Since the increase in these schemes, there have not been any short term changes in trade observed, but there will be.
“Reorganizing, changing trade flows taking some time,” said Dross. “I expect it to take a few years,” he said. This is down to the diversification of supplies and long term relationships between countries and their current suppliers. For example, traditionally the Philippines supplies the UK and Germany and cannot increase its supplies to other markets straight away.
-------------------------------------------------------
Monday, April 20, 13.25 pm CET
IPNLF under no illusions
The International Pole and Line Foundation (IPNLF) is under no illusions the pole and line sector cannot meet the global demand for tuna, but it is determined to make up a larger proportion than it does.
“We recognize pole and line cannot meet global demand, but it can make up a greater proportion than it does at the moment,” according to Emily Howgate, program director at the IPNLF.
According to Howgate, the IPNLF is working in partnership with members on projects that enhance transparent, traceable supply of pole and line tuna.
These include bait fish management by using alternatives such as farmed milkfish. But also gathering more data on stock status and management of these fisheries.
“Pole and line can, and should, make up more of the global supply,” she said.
Speaking on the subject of FADs, Howgate said she feels there needs to be more data. But she also said it is important to differentiate between anchored and unanchored FADs.
Anchored FADs are more manageable and there are a fewer number compared with those which are unanchored she said, of which estimates say there are 100,000.
“With anchored FADs there is a reduced risk of environmental impacts compared with those unanchored.”
The industry has seen ongoing momentum in the support of (unanchored) FAD-free tuna supply, and social accountability, according to Howgate.
“Pole and line caught tuna can be seen as at the confluence of these currents, being low environmental impact and unassociated with (unanchored) FADs, while also contributing to vital jobs in coastal communities.”
-------------------------------------------------------
Monday, April 20, 12.35 pm CET
Sharks ‘high priority’ when it comes to FADs
The main concerns for scientists regarding FADs are around their impact on sharks, according to Gala Moreno, senior researcher at AZTI Science Institute.
While FADs are efficient fishing aids, they do have a number of impacts on tuna stocks, biodiversity and the habitat.
In terms of bycatch species though, Moreno said sharks represented the highest priority, whereas numbers for bycatch of turtles was of ‘no real concern’ to scientists.
Likewise, bycatch of whale sharks and manta rays were not too concerning, although should be monitored, said Moreno. Other tuna species and finfish make up 80-95 percent of the bycatch, but this is of no particular biological concern, but again monitoring is necessary. “Here, the main concern is what to do with the bycatch and make sure it is not wasted.”
Sharks, though are much less resilient and they are slow growing, so they are a major concern for scientists when it comes to FAD bycatch.
Moreno said best practices for the crew surrounding the safe release of sharks need to be established both from the nets and from the deck.
In fact, Moreno said trials were underway on some ISSF vessels which are using ‘shark escape panels’ on the nets to see if that helps with the levels of bycatch.
-------------------------------------------------------
Monday, April 20, 11.45 am CET
Our market had a stroke
The average price for frozen whole round skipjack has plummeted from nearly $2,500 per metric ton in 2012, to just $1,300 per metric ton in March 2015.
The market has shifted from a bullish market to a bear market, said Henk Brus, CEO of Pacifical, “and we have lost $3 billion in value in two years.”
He described the crash in prices like the market having a stroke. "There was too much supply going in to bangkok -- where the benchmark prices are set -- and the market had a stroke."
But with tuna prices coming down from a high level and consumers accustomed to paying higher canned tuna prices for the last two to three years, there has never been a better opportunity to offer consumers more attractive prices, and calculate a premium in such a lower price.
This would also cover the costs required for a sustainable and socially responsibly catch.
Canned tuna is still Europe’s most popular seafood, with per capita consumption reaching 2.14 kilograms said Brus, and the European tuna canning industry will become again increasingly important in serving this market.
“It will be a highly robotized assembly industry mostly based on pre-cooked frozen loins, located close to the major markets, and capable of packing in innovative packaging with better marketing features.”
According to Brus, retailers and consumers increasingly want to have sustainable seafood that can be easily identified as such through a recognized logo and is fully traceable with a transparent supply and production process.
-------------------------------------------------------
Monday, April 20, 10.35 am CET
Peak time for consolidation in tuna sector
Following the ‘mega merger’ between Thai Union Frozen Products (TUF) and Bumble Bee at the end of last year, now is “the peak time for consolidation” in the canned tuna sector, according to Gorjan Nikolik senior industry analyst at Rabobank.
“Consolidation is at high point enabled by low tuna prices and ample capital,” said Nikolik.
Lower tuna prices mean margins are high, and with ample capital – at a low cost -- in the market it is both a good time to sell and a good time to acquire, he said.
“This is the time when most consolidation will occur, and it is possible that maybe a few more mega-deals might happen.”
That said, in the next 5-6 years, many tuna companies are likely to diversify their portfolios, as there is a limit to what more can be done in terms of organic growth.
In addition, Nikolik said there is a noticeable shift in consumption of canned tuna towards developing countries.
The EU remains the largest market but it is flat, while the US market has been declining since the 1990s, he said.
Instead there is “increased globalization” and canned tuna is now becoming a “middle income product worldwide.”
As for the exact reasons to the price volatility in the tuna sector over the past three years, Nikolik said it is evidently linked to fluctuations in oil prices, but this cannot be the only reason.
“It has been too volatile to just be oil price related,” said Nikolik. Instead, he sees the influence of FAD fishing and FAD bans as the culprit.
“Do these bans really work then if the only thing they cause is price volatility,” he said.
-------------------------------------------------------
Monday, April 20, 9.50 am CET
US food advice damaging to children
In the United States, the government’s advice is that children should not eat more than 340 grams of fish per week to avoid toxins, William Cortvriendt told delegates at the 2015 EU Tuna Conference.
However, a study found that those who eat more than 340 grams per week show more rapid intellectual development as we as verbal and communication skills.
“So it is not the toxins in fish that are damaging to children but the US federal advice,” said Cortvriendt.
Fish consumption has also been proven to correlate to lower levels of depression and dementia, he added.
-------------------------------------------------------
Monday, April 20, 9.43 am CET
Eat fish -- live longer
In his speech, William Cortvriendt, a medical doctor, outlined the correlation between lifestyle and health, as well as how long you can live if you eat the right things – especially fish.
“The speed at which we age does not only differ between species, but also differs remarkably within species itself, like it is in the case of humans,” said Cortvriendt.
While some people stay healthy way beyond the age of 100, others die young often after many years of health problems.
It has been recognized that genetic differences play a role, however, the most important determining factors for speed and quality of aging are external factors such as environment, toxins, food and physical and mental stimulation, said Cortvriendt.
“More and more it becomes clear that exchanging the part of the abundant and low quality carbohydrates in our modern diets into high quality fats and proteins plays a key role in the prevention of rapid aging and many serious diseases such as cancer and cardiovascular diseases.
“Modern research suggests that increasing the consumption of fish would be an important step towards a longer and healthier life.”
-------------------------------------------------------
Monday, April 20, 9.25 am CET
'The world is watching us'
In the opening speech of the EU Tuna conference, Pierre Commere, director general of ADEPALE and chairman of the conference, said many changes are happening simultaneously on several aspects of the tuna supply chain.
Regional fishing management organizations are doing their best to fix rules, there have been improvements in vessel surveillance and in the fight against IUU fishing, while independent observation at sea has become necessary, but costly.
Meanwhile, trade regimes are changing, with a number of free trade agreements freshly implemented or under negotiation, while the EU GSP plus scheme closed to some old benefiting countries – notably Ecuador – and opened to new ones, such as the Philippines.
In this context global tuna production has reached 4.5 million metric tons, a no one is openly claims for greater fishing capacity and effort; down the supply chain traditional and new markets show a dynamic demand.
Over the long term, together with increasing production costs, this determines an uptrend in prices.
“But availability cannot grow any further, or should not grow any further, without putting future at risk,” said Commere.
“Actual resource sustainability is paramount to the industry to be to provide markets for generations with good, healthy marine proteins.”
Recently, the industry has witnessed the implementation of effective and actual projects.
“The world is watching us, particularly with the boom of social media,” said Commere. “The industry cannot focus on short time prices and profitability must focus on sustainability.”
Furthermore, the industry should not consider NGOs as enemies but rather as allies.
Instead the industry should consult with an open mind, as constant improvement is the way forward, “we all want the same goal of sustainable tuna,” said Commere.
“Altogether there need to be more effort tin improving the reputation of tuna.”
-------------------------------------------------------
Monday, April 20, 7.00 am CET
This time it’s different
The fifth European Tuna Conference kicks off in Brussels this morning, with industry leaders from all over the world descending on the city's Sheraton Hotel to discover and discuss the main trends and challenges facing the sector.
During the day-long conference, delegates will talk about the major changes set for the global tuna industry and discover how this will influence tuna sourcing and marketing policy.
The theme this year is ‘This Time It's Different’, and the one-day agenda will cover a whole host of topics, from the FAD debate and the Thai Union mega-merger, to the plummeting global skipjack prices and fleet overcapacity.
-------------------------------------------------------
