reLAKSation 202.
(Y)aw(n)esome!!:
In a recent editorial, Knut Eirik Olsen of IntraFish said that whilst a
majority are glad that the long dispute between the EU and Norway is over, he
does not believe that it was wrong of the Norwegians to challenge the might of
the EU. Mr Olsen was responding to comments made by Fritz Harald Wenig in which
he said that he didn’t understand why the Norwegian industry had politicised
the dispute. He was speaking in an interview in the financial newspaper
Dagens Naeringsliv.
We,
at Callander McDowell, would suggest that the reason that Mr Wenig doesn’t
understand the Norwegian response because he hasn’t understand the dynamics of
the salmon market, nor has tried to understand it. He isn’t in the slightest
bit interested in the fact that his actions have forced salmon prices upwards
and that salmon is now starting to become too expensive for many consumers. Some
of the supermarkets are now beginning to realise that if they don’t act, their
sales of salmon will inevitably decline. For example, leading British
supermarket chain Tesco, after initially raising prices, has started to discount
salmon again for the first time since prices began to rise. This week, Tesco
have whole salmon on offer at £3.29/kg. Only last week Gilpin Bradley of Wester
Ross Salmon told IntraFish that there had been a long overdue adjustment in
prices and that the ex-Glasgow price had been hitting £3.25/kg. One certainty
is that if the supermarkets continue to discount salmon, and Tesco are not the
only supermarket chain to do so, it will not be the supermarkets who will be
subsidising the price. Mr Wenig however believes that consumers should be
willing to pay a ‘fair’ (in his estimation)
price, but he remains silent as to what should happen if they are not
prepared to do so.
Mr
Olsen also points out that Mr Wenig has made it clear that anyone that has ideas
about opposing an EU decision receives an introduction on how the EU’s power
system works. Mr Wenig said that the system is more about balancing power
through compromise than about who is right, although as Mr Olsen suggests, it is
clear who decides what the consensus is!
Mr
Olsen questions whether the Norwegian industry chose the wrong strategy to fight
the safeguard issue but suggests that there were no grounds to raise any case.
He said that the Norwegian industry read the complaint but whilst there were
many claims, he said that
there was little documentation about the alleged flood of low priced
salmon
However,
the issue now is not about safeguards but rather concerns the dumping case. We,
at Callander McDowell, are not convinced that the Norwegian industry has treated
the dumping case in the same way as safeguards. The dumping complaint should be
challenged because it has no basis. The reason it should be challenged is
simple, for as Mr Olsen says, the measures imposed against Norwegian salmon are
just unfair. Clearly, at the moment, the Norwegian industry has little incentive
to challenge the case for with prices riding high, the measures imposed by the
EU are meaningless. Yet, when prices start to fall, and for certain they will,
there will be increased likelihood that Norwegian salmon might be excluded from
the EU market. Those who are currently indifferent to fighting this case will
then be singing a totally different tune. It will then be Mr Wenig who will be
indifferent to the case. After all it is clear he doesn’t care who is in the
right.
Old
age - young taste?: IntraFish report the
findings of research conducted by Datamonitor which showed that older consumers
now account for one quarter of the ready meal market. This is thought to be due
to the increasing number of seniors who are working later and living alone.
Whilst
these senior citizens spend over Euro 3 billion on ready meals, the growth of
this sector may not bode well for the salmon industry. Previous research has
shown that the traditional salmon consumer tends to be in the older age groups.
The rationale has been that older consumers have more disposable income to spend
on salmon and more time to prepare it. This is because their families have
tended to have flown the nest. By comparison, many younger consumers avoid fresh
fish and prefer the convenience of ready meals and similar supermarket
offerings. Advisers to the salmon industry have suggested that it is easier to
convince existing consumers to eat more salmon that to persuade non eaters to
start doing so. Promotions featuring salmon have therefore focused on existing
consumers, who also tend to be older.
Yet
these new findings would suggest that these older consumers are now succumbing
to the convenience and ease of the ready meal sector rather than bothering with
cooking from scratch using the raw ingredients. Even the most basic observations
in supermarkets would indicate that older shoppers are buying more and more
prepared food.
We,
at Callander McDowell have always argued that older consumers are more
comfortable buying and preparing fresh fish because they grew up at a time when
consumption of fresh fish was commonplace. They buy more fish because they are
used to doing so. By comparison, younger consumers have grown up with the
convenience of the supermarkets and are unfamiliar with fresh fish because they
tend to buy all their food ready prepared. Such consumers are unlikely to even
consider buying fresh fish because it is alien to them. As the older consumers
are now buying more ready meals, then they are less likely to buy fresh fish
than they had previously. If older consumers are moving towards the buying
patterns of the younger age groups, then who will be left to buy our salmon?
Samwn
(Salmon in Welsh): Our observations in the
retail sector would suggest that many shoppers never read the labels of the
foods they buy. Certainly, when in the past the Scottish industry argued that
consumers have been misled into buying Norwegian salmon when they thought it was
Scottish was not really true. Most packs of salmon have been clearly labelled
with the country of origin, it is just that the consumer has never bothered to
look. This is why there have been several examples of packs coming to market
with labelling errors that have not been picked up by consumers, because they
just don’t read them. Past examples we have identified have included packs of
Scottish Tartan Quality Mark salmon, which are labelled ‘Farmed in Norway’.
However, whilst most consumers don’t bother to read the label, there is the
odd example of an eagle eyed consumer who does.
The British Daily Mirror reported that one consumer, Dr Robin Parry of Caernarfon in Wales bought a pack of Scottish salmon from his local Safeway store and noticed that the picture on the label wasn’t quite what it seems.
Under
the headline “Scots up?”, the paper reports that the scenic photo of a
Scottish mountain rising from a loch is actually Mount Snowdon, which is in
Wales, not Scotland. They also say that embarrassed supermarket chiefs have now
apologised however they also point out that this label appeared before new
owners, Morrisons acquired the Safeway chain.
We, at Callander McDowell, would like to put another spin on this story. That is that when Safeway operated as an independent chain, they actually produced a number of variations of the same label. This enabled them to sell three different salmon offerings. These were Norwegian salmon, Scottish salmon and Scottish TQM salmon. This was later rationalised to reduce the number of front labels to two with the removal of the TQM symbol onto the back label. At different times, all three combinations would appear on the supermarket shelf at the same time, whilst at other times, just one or two variants might be available. In the end, most of the options disappeared from stores simply because all the different packs were priced identically and as the salmon from one pack looked and tasted the same as that from another, it made little difference to consumers which pack they bought.
Once
Safeway were acquired by Morrisons, the labelling was rationalised to that
stating the salmon was Scottish because Morrisons seemingly buy their salmon
only from Scotland. However, if they had continued to use all the labels
produced by Safeway, then it is possible that consumers might have thought that
the picture of Snowdon was actually of a Norwegian fjord and mountain.