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Importing $11 billion of fish per year, Europe's requirements will only grow.

Importing $11 Billion of Fish Per Year, Europe's Requirements Will Only Grow

With Jan. 1, 1933, and the promise of a single European market creeping ever closer, the world's seafood producers are firming up supply lines to the Continent. But not because of fears of being frozen out of potential "Fortress Europe" after the world's largest trading bloc solidifies.

"Seafood is one of the few industries for which most barriers to intra-EEC trade have been removed since the early 1970's," pointed out Siegfried Verstappen, managing director of E.M.M.S. bvba, a consulting company based in Sint Niklaas, Belgium. But he was quick to add that non-tariff barriers exist, such as sanitation standards and documentation requirements.

"Plus there can be some convenient exception to the rules, particularly when these exceptions can help bring in raw material for processing by the European seafood industry," elaborated Verstappen.

It is estimated that Western European accounts for about 20% of the world's $100 billion in annual seafood trade. It imports some five million metric tons per year valued at $11 billion. And these figures are expected to rise steadily over time, along with the region's standard of living.

Opportunities abound for frozen seafood sellers, especially those who promote value added products that tend to be popular with younger consumers - the ones who are going to be buying fish for a long time to come. And the seafood sector is doing a good job making in-roads with health conscious people of all ages as media scares over meat and poultry consumption have resulted in a 20% rise in fish sales over the past few years.

Still another boost for seafood merchandising is found in the way purchases are being made. Today sales are increasingly taking place at supermarket chains rather than in specialty shops, where fresh fish traditionally dominates. In France chain stores have carved out a leading 34% of the seafood market, followed by 32% for traditional fishmongers.

No Monolith

Verstappen, who a few years ago was engaged in promoting USA seafood products in Europe, offered some advice to non-Europeans looking to crack the Continental market: "The Europe of 1993 will not magically become a monolithic market, where one approach will suffice to market one's seafood products in all countries. Not only will there inevitably still be some special cases and exceptions, but there is no such thing as an underlying uniform market."

It is fundamental to understand the regionally divergent consumer preference that shape individual markets. Indeed, per capita consumption of seafood varies from 88.4 kilos per year in Iceland to 18.8 kg. in the United Kingdom and only 8.5 kg. in the Netherlands. And the value of imports needed to feed national demand runs from over $2 billion in France to $1.3 billion in Spain and just $332,827,000 in Switzerland.

In general most countries in Western Europe (with the exception of those in Scandinavia) are running seafood trade deficits. This is largely because of decreasing domestic catches and the loss of landing from distant water fleets due to the establishment of exclusive economics zone by coastal countries.

Verstappen elaborated on how consumer demand is determined by traditional preferences and tastes influenced largely by geography. He divided the Continental seafood market into three sectors: Scandinavia and the northern and southern tiers of the EEC. Regional analysis follow:

Scandinavia

The Scandinavian countries of Norway, Iceland and Denmark - which consume enormous quantities of fish per capita - catch and/or farm large volumes of seafood. Most of the production is exported within the Common Market, usually after processing.

In recent year Norway has become known worldwide for its salmon farming. However, it has traditionally been a major supplier to Europe of wild North Atlantic species such as cod, haddock, saithe, mackerel, herring and red-fish. Lately, because of the ever shrinking resources of these fish, Norway has developed an importing arm - particularly for cod - to keep the domestic processing industry operating.

Iceland boasts the highest per capita consumption of fish in Europe, if not the world. The seafood industry accounts for an extravagant contribution to the island nation's GNP, as roughly one-third is derived from fishery-related activities.

Apart from cod, Iceland exports a wide range of seafood products similar to those offered by Norway. It has always excelled at selling both to the USA and the Soviet Union. The products exported are neatly divided, with IQF fillets of demersal species going mostly to North America and whole round frozen, cured or salted pelagic items routed to the USSR.

Denmark is probably the most diversified and international in outlook of the three Scandinavian countries reviewed here. Imports play a greater role in keeping the domestic processing industry operating than in Norway or in Iceland. They consist mostly of fresh and frozen cod, salmon trout and shrimp. Typically, a lot of imports arrive in the guise of seafood catches which are landed in Danish ports by the exporting countries' vessels. In 1987, some 175,000 tons were imported that way.

The Danish export industry is different from those of Norway and Iceland as it is more oriented toward fresh fish sales. Thanks to proximity to the major European markets, good logistical support and access roads, trucks can deliver fresh products to buyers as far away as Milan within 24 hours of landing.

Like Norway and Iceland, the major customer base for Denmark lies in the Common Market, which absorbs about two-thirds of production. Overall, Danish external fish sales account for up to 90% of the country's output, making it the world's third largest exporter.

The Common Market

Within the EEC, a dividing line can be drawn halfway through France between the Atlantic Ocean and the Swiss border and passing just underneath Lyon. In the northern territory, seafood consumption is dominated by species found primarily in the North Sea and/or the North Atlantic. The southern half is much more oriented toward products coming from the Mediterranean and the South Atlantic Ocean.

Microwave oven ownership patterns in individual households of Western Europe underscore the basic geographical division. High rates of penetration are found in the UK, Scandinavia and Germany. But ownership drops precipitously as one heads outward through the Netherlands and Belgium to France and the Mediterranean states. Even such an industrially advanced country as France can claim no more than one in 10 homes equipped with microwaves.

So it should come as no surprise that while there is a clear trend in the north toward modern convenience foods (notably frozen and vacuum-packed items), the south still favors canned, dried, salted and marinated fish.

Furthermore, while northerners have a long tradition of importing fish to complement diminished landings from domestic boats, this is a new development for the Mediterranean nations. In particular, Spain, which historically has been inordinately dependent on catches from its distant water fleet, is now being quickly transformed from a basically self-sufficient market handling a limited range of seafood products. It is emerging into a sophisticated consumer market which has acquired the knack of working with foreign suppliers. Thus, novel product forms of traditional seafood species and the introduction of hitherto unknown fish are catching on.

It should be noted that Western Europe is affected almost as much as Japan by the ever growing gap between falling supply and rising demand. FAO data indicate that world catches, which were systematically increasing between 1970 and '85 when they reached about 85 million metric tons, flattened out after the mid-80s. For the year 2000, FAO estimates that total supply will have expanded slightly to reach 94 million tons. However, international requirements are forecast to rise at a significantly greater pace, resulting in total demand of about 114 million tons. That will leave a shortfall of 21 million tons, or 18%. Given the inelasticity of world demand, and the likelihood that acquaculture is not expected to make a sizable impact for the next 15 to 20 years, demand will likely be restrained by a corresponding advance in overall price levels.

There are sharp differences in the seafood trade among countries in Western Europe. Two extreme example are found in the neighboring Benelux states of Belgium and the Netherlands. The former is a high fish consumption nation, where local landings are primarily for domestic use rather than for the national processing industry. The combination of strong demand at home, high processing requirements for exports, and small domestic catches (the limited fleet's 200 vessels annually land about 30,000 metric tons) leads to a situation where seafood import volume exceeds total domestic consumption.

The Netherlands could hardly be more different. It boasts a large and very efficient distant water fleet scouring the seven seas for raw materials, large volumes of imported fish, an important and highly successful processing industry, and relatively good catches in its North Sea jurisdiction. Yet the lion's share of all this seafood is destined for processing into value added items which are sold abroad.

Indeed, the Dutch, who are internationally perceived to be ardent fish eaters, are actually the lowest per capita consumers of seafood in all of Western Europe. At 8.5 kilos (18.75 lbs.) per person, the Netherlands is only at a par with the USA. It is therefore easy to see why a large trade surplus exists, notwithstanding the overall trend toward supply shortfalls.

In general, most individual EEC countries cover at least 50% of their seafood needs through imports. Taken together, however, the collective EEC trade deficit is not so bad. It is estimated that approximately 70% of all fish imports registered by member countries originate from other EEC states.

Most of the remaining 30% - which is worth about $3.5 billion a year - comes from Scandinavia, followed by countries of northern and western Africa and Canada. The USA is a marginal suppliers, accounting for less than 5% of total import value. Its market positioning is rather weak, since the product range being exported to Europe consists mostly of commodity-type products with little or no added value. Exceptions are Pacific salmon, Maine lobster, shrimp, squid, blocks of white finfish fillets (mainly Alaska pollock), fishmeal and fish oil.

France Leading Market

France has always been Europe's largest seafood market. Today's imports of about 1 million metric tons are worth more than $2 billion. At least 30% of the tonnage is imported. Fresh seafood probably accounts for nearly two-thirds of overall consumption. Frozen claims about 30% of the market, and salted, smoked or dried items 2%.

Major components of France's domestic catch are saithe, whiting, hake, cod, haddock, tuna, sardines, oysters and mussels. Total landings were put at approximately $500 million in 1989. Major imports are: salmon (valued at $162 million), fish fillets (almost $200 million), canned tuna and bonito ($84 million), lobster ($86 million), and shrimp ($175 million).

Imports come from around the globe. Traditionally, a lot of fresh fish has been brought in from former French colonies in western and northern Africa. This was done at first to supply large ethnic markets, but later it became necessary to help fill the general supply gap. Import volume has also been enhanced by the emergence of Rungis, the wholesale fish market near Paris which attracts tonnage destined for surrounding countries. In particular, Great Britain, Denmark and the Netherlands are the major suppliers. They are complemented by Norway, Canada, the USA (mostly salmon), Senegal and the Ivory Coast (tuna), Morocco, Portugal and Italy (sardines).

Italy

Italian imports of seafood products totalled $1.8 billion in 1987, surpassing local catches in value for the first time ever. The leading species procured from abroad are tuna, shrimp, squid and lobster.

After Spain, Italy has the Common Market's second largest fishing fleet. Notwithstanding the renovation efforts which have been going on since the 1960s, the fleet is still chiefly composed of small, inefficient vessels which are unable to compete with large ships.

In recent years, suppliers from more northerly counties have managed to establish a foothold in Milan, the country's major distribution center for fresh fish. EEC members - namely Denmark, the UK, Spain and Greece - dominate imports. Salted cod comes mostly from Norway. Poland and Thailand are the leading providers of squid, while Argentina is the main source for hake. Other suppliers include the Seychelles, Panama, Mexico and the Ivory Coast.

Germany

Of the major markets in Western Europe, Germany has the lowest per capita seafood consumption. While this has traditionally been so (after all, the German heartland is many miles from the sea), the problem has been exacerbated in the last few years by media scares. Chief among them was a televised report on nematode (intestinal worms) presence in fish, followed by stories about oil spills, algae blooms and seal deaths in the North Sea. Only in 1989 did seafood marketers begin to believe that German consumers were again ready to buy without fear.

Fish buyers in Germany are probably among the most demanding in Europe. While total 1988 consumption of 722,000 metric tons was worth almost $2 billion, the market depends on imports to cover over 60% of its needs. Herring is still the most important species, followed by salmon, cod, tuna, redfish and other traditional items. In the last few years, the product range has been expanded to include Maine lobster, caviar, shrimps mussels and crayfish.

Major sources of supply are Denmark, the Netherlands, Norway and Iceland. Denmark sends herring, cod, smoked salmon and trout products. The Netherlands provides herring, plaice and sole. Iceland delivers herring and halibut. The USA, whose $10 million in sales comes mostly from salmon and Alaska pollock, represents only 1% of the important market.

Germany's relative conservatism also shows in its pronounced taste for canned seafood items, which represent 29% of the market. Frozen accounts for 22%, fresh for 11%, and smoked for 6%. Shellfish has a market share of 19%, while deli products claim 9%. Finally, salted herring alone represents 4% of the total fish consumption.

Spain

The Spanish seafood market has seen a swift rise in imports to make up for dwindling catches from domestic and blue water trawlers. In 1987, Spain's national landings were worth $1.5 billion, while imports totalled $1.3 billion. However, while local tonnage is stagnating, imports have surged by 82% in value and 68% in volume. They now represent the majority of supplies to the Spanish market.

Landings consist mostly of hake, sardines, squid, cuttlefish, octopus, cod and shrimp. Major imports are squid, hake, tuna and shrimp. The latter species alone accounts for 20% of import value.

One of the most striking and difficult transitions for Spain is the restructuring of its fishing fleet, which is easily the largest in the EEC with over 100,000 crew members and about 18,000 boats (of which 6,000 are less than 30 feet long).

Table : Import Value of Fish into Europe
Country Thousands of US $
France 2,022,470
Italy 1,738,226
U.K. 1,386,818
Spain 1,321,771
West Germany 1,270,495
Denmark 842,476
Belgium 529,941
Netherlands 509,430
Portugal 424,716
Sweden 404,897
Switzerland 332,827


Table : Per Capita Consumption Of Seafood in Europe
Country Kilos
Iceland 88.4
Portugal 43.0
Norway 41.2
Finland 35.2
Spain 34.2
Sweden 27.8
France 25.8
Denmark 21.0
U.K. 18.8
Greece 18.4
Belgium/Luxembourg 18.1
Italy 17.9
Ireland 15.1
Switzerland 12.9
West Germany 10.4
Netherlands 8.5
COPYRIGHT 1991 E.W. Williams Publications, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Title Annotation:fish and seafood consumption in Europe
Publication:Quick Frozen Foods International
Date:Jul 1, 1991
Words:2580
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