reLAKSation
156.
New
chapter? What new chapter?: Reacting to the
announcement of the imposition of safeguards, Angus Morgan of the European
Salmon Producers Group said that it was excellent news that represented a new
chapter for the Scottish salmon industry. In contrast, we at Callander McDowell,
said that whilst Mr Morgan might see it as a new chapter, we believed it to be
simply more of the same old story (see reLAKSation no 153) and so it seems to
be. On Friday, the EUSPG announced that they had been left with no alternative
but to file an anti-dumping suit against the Norwegian industry. When will Mr
Morgan and his colleagues start to realise that running to Brussels yet again is
no solution for those seeking the long term viability of the salmon farming
industry?
In
a press statement reported by IntraFish, the EUSPG said that they had been
forced into this decision because Denmark had decided to appeal to the EU
against the decision to impose safeguard measures. They also said that since the
safeguard measures had been put in place, the Norwegians have continued to dump
salmon on the European market, with prices falling by up to 6%.
The
problem is that this minority of farmers believe that as European producers,
they should have exclusive rights to the European market. They blame the
presence of any imported salmon in the European market for undermining the
market image and price of their own salmon. They perceive that the only way that
prices can be forced back up to the sort of level achieved before 1989, is if
imported salmon is totally excluded from the European market, or at least that
it should carry a punitive duty sufficiently high to make imported salmon much
more expensive than it is now. These farmers have unsuccessfully tried to
persuade the EU on repeated occasions to succumb to their demands, however the
EU has failed to respond to these demands because they have the interests of
more than a few farmers to consider. Other member states, such as Denmark have
more than a passing interest as they have developed a significant processing
industry that utilises imported Norwegian salmon. Equally, the EU has to take
into account consumer requirements, especially as farmed salmon represents a
value for money alternative to diminishing supplies of wild caught marine fish.
The
submission of this latest anti-dumping suit is hopefully the last gasp actions
of a small section of farmers who have become out of touch with the modern
salmon farming industry.
It
will be interesting to see how the European Commission reacts to this latest
ant-dumping complaint. They have just invested a lot of time and effort into
investigating the case for safeguards. It is unlikely that they will want to
start over again on exactly the same issue, especially as the question of
safeguards is not yet fully resolved. The current measures are provisional and
look as if they are going to be sent for appeal.
Surely, the question of safeguards must be sorted out first before they
even contemplate another investigation. They have also to be persuaded that the
current price movements are as a result of dumping and not just another example
of the usual day to day price variations. Certainly, current price levels fall
within the typical price banding exhibited over the last three years.
According
to the EUSPG, the Scottish and Irish industries have been severely affected by
massive over-supplies, imported at prices well below the cost of
production. As a result, they say that at least six companies have gone bust
over the last twelve months, whilst many others are being forced to stop
investment and limit production. This does appear to be a bleak picture, that is
until these claims are examined in more detail.
We,
at Callander McDowell, have argued previously that whilst some companies have
gone into liquidation, it would seem that management practices rather than
salmon imports are more to blame. Whilst some businesses have gone bankrupt,
their owners continue to operate other salmon farming companies and at least one
owner has bought back the assets of his bankrupt company from the receivers.
Whilst there have been a handful of bankruptcies, these seem to relate to a
reluctance to restructure in response to a changing industry rather than
Norwegian dumping. Elsewhere, one of the companies signing up to the safeguard
application, has subsequently bought out one of its local competitors. Clearly,
some companies have the money for investment despite claims from the EUSPG
otherwise. Equally, the EUSPG say that Scottish farms have had to limit
production, yet another one of the companies signing up for safeguards was just
in the news because it was prosecuted for exceeding its production licences. The
company were found to be producing 24 tonnes of smolts when its licences only
allowed for 4.5 tonnes. The company was accused of massive over-production and
fined £12,000.
Finally,
Scottish Quality Salmon, some of whose members are also members of the EUSPG
have just announced the award of a FIFG grant from the EU for £1.5 million for
the second part of their healthy eating promotion. This award must be matched
with £1.5 million from the industry itself. This seems to be a substantial
investment, when according to the EUSPG much of the industry is unable to invest
in their own farms.
Many
of the claims, made by the EUSPG,
about the state of the industry do not seem to add up. This is not
surprising since there also appears to be little substance to any of the dumping
allegations. The salmon industry cannot continue down this road but must change
along with the changing markets. Sadly, Mr Morgan and his colleagues are unable
to see this and are determined that the whole industry must suffer as a result.
If the EUSPG do not feel that they can compete in this global marketplace, then
perhaps they now have an opportunity to rewrite this chapter with new beginnings
elsewhere. Meanwhile, there is only one place suitable for the anti-dumping
submission and that is the waste bin.
I’ll
ask her!: The Salmon Farm Monitor, the web
magazine of the Salmon Farm Protest Group recently carried an article claiming
that the salmon farming industry was actively disseminating disinformation and
misleading the public about the salmon they buy. One of the SFPG’s campaigns
was to highlight supposed inconsistencies in the labelling of salmon products.
They argued that consumers were being misled into buying farmed salmon when they
thought it was actually wild, although Callander McDowell’s regular
observations of the retail do not support their assertion. Whilst farmed salmon
products are all clearly labelled, the same cannot be said for salmon caught
from the wild. The most confused labelling involved wild salmon from Alaska and
along the Pacific coast.
In
most cases, consumers could be forgiven if they thought that the wild salmon
offered by supermarkets was in fact, the same fish as farmed, only that it comes
from the Pacific. This misconception is even used in advertising by the Alaska
Seafood Marketing Institute. They quote restauranteur and chef Aldo Zilli as
saying that ‘The difference in flavour between a wild and farmed salmon is
immense’. Well, it would be as in Europe where the advert appeared, the two
fish are totally different species and therefore not expected to taste the same.
The ASMI do state that there are five species that come from Alaska, but they do
not make any attempt to say that the fish are not the same species as the better
known Atlantic salmon. The problem for consumers is that all five species also
have several alternative names so they cannot be sure which salmon they could be
buying. The names provided by the ASMI are as follows, together with one
alternative, and in some cases better known, name.
1.
Pink, Humpback
2.
Keta, Chum
3.
Sockeye, Red
4.
Coho, Silver
5.
King, Chinook
In
the UK, only one supermarket has ever used any of these names in the labelling
of the wild pacific salmon (although many years ago, Waitrose did do a market
test of coho salmon). Tesco have sold whole Keta salmon and Silver salmon
fillets. Every other supermarket uses a more generic name. Some like Marks &
Spencer and Waitrose use terminology such as ‘Wild Pacific salmon fillet’
whilst others like Sainsbury’s use the more confusing ‘Wild Alaskan salmon
fillet’.
Aldo
Zilli has provided the ASMI with a recipe for use in their advertising. He says
that Sockeye would make the dish look particularly dramatic. Unfortunately,
consumers would have a great deal of difficulty in finding any Sockeye salmon
other then in tins, because wild salmon is never labelled as such.
The
Salmon Farm Protest Group have never made an issue about this confused
labelling. Presumably, as these salmon are flown in from Alaska, the protest
group cannot blame them for disrupting their sport fishing, thus they are not so
concerned whether consumers are being misled as to which fish they are eating.
Global
salmon plc: Botholf Stolt-Nielsen, advisor to
‘Salmon of Europe’, told IntraFish that this new organisation is not
Norwegian but rather an international body adapted to the global reality. He
said that their objective is to spread information about salmon across national
frontiers. ‘The point is to enlighten people on the health related advantages
of eating salmon as well as to counter any negative attacks.
These
objectives are almost identical to those of the ‘Salmon of the Americas’ the
model on which ‘Salmon of Europe’ was based. In addition, most of the
members of SOE are also members of SOTA,
We,
at Callander McDowell, wonder why there is a need for these two separate
organisations. A scan of the SOTA website suggests that the information they
provide is equally relevant to the European consumer, as well as those in Japan
and the Far East. Would it not make more sense to invest in one single
organisation, with offices in the key markets, so that the global industry
presents a united front? When asked about cooperation between the two
organisations, Mr Stolt-Nielsen said that the Chilean industry, including most
SOTA members, tend to target the American market, whilst European producers tend
to target Europe. Yet, he also said that it is phoney to think in terms of
individual nations, as the larger companies are now global players. In that
case, does it not make more sense to promote the positives of eating salmon in
every market, irrespective of where it is?
Finally,
we were interested to see that Mr Stolt-Nielsen is keen to ensure that the
correct information is submitted when the industry is under attack. He said that
salmon is an easy target for groups that are out to cause a furore about a
product that is still new and foreign for many. He went on to say that
agriculture is several thousands of years old, whilst aquaculture is a
completely new industry. Mr Stolt-Nielsen is right when he said that the
industry must get its fact right and he shows how easy it is to get it wrong.
Intensive salmon may be relatively new, but aquaculture has a long and varied
history. Fish were artificially hatched in China as long ago as 2000 BCE,
although it wasn’t until 475BC that the first treatise on fish culture was
written down by Fan Li! In the UK, we can trace fish farming back to as early as
1458 and the maintenance of fishponds back to the Doomsday book shortly after
the Norman conquest of 1066.