reLAKSation 302. Callander McDowell
Leaking confidence: According to well-informed sources from both sides, IntraFish has heard that the WTO is most likely to find in favour of Norway when they publish the final report on September 10th. It would be a major miscarriage of justice if the WTO were to come to any other conclusion. This is because we are in no doubt that the salmon complaint is both unjustified and mishandled by the European Commission.
We, at Callander McDowell have repeatedly highlighted the inconsistency between the data submitted by the Scottish Executive in support of the safeguard application and the EUSPG’s submission for the dumping complaint even though both relate to the same time period. We believe that the European Commission had already concluded that Norway was guilty of dumping following their safeguard investigation so did not bother to correctly assess the EUSPG data in accordance with WTO rules when it was eventually submitted to them. The Commission then took the view that as the subsequent investigation confirmed dumping had taken place, then it was irrelevant whether the original data was incorrect or not. Yet clearly, had the submission been properly vetted, then there should have never been an investigation and Norway would have never been found guilty anyway.
The Commission argument that the investigation had found Norway guilty of dumping equally does not hold water since the dumping margins uncovered are nothing but an artefact of the type of spot investigation undertaken by the Commission that is more suited to assessing manufacturing processes than salmon farming. Dumping margins have always been found in salmon farming and will be so in future if the international industry continues with this pointless and damaging infighting.
It was encouraging this week to also read in IntraFish that Richie Flynn of the Irish Salmon Growers Association has said that the industry must heed the lessons of the past when it comes to price. Boosting production just because prices are high, always leads to disaster. Instead, Mr Flynn has said that the salmon industry must consider either increasing its marketing budget or add extra value. We, at Callander McDowell totally agree.
With wild catch fisheries in severe decline, consumers will continue to want a value for money fish for everyday consumption. Salmon fits that bill in every way. It’s just a shame that some sections of the industry have taken so long to recognise this opportunity!
Ruminating sustainability: FIS.com reports that the European Parliament has adopted a report by MEP Struan Stevenson calling on the European Commission to lift the ban on feeding fishmeal and fish oil to ruminant animals. Currently 66% of the fishmeal used by the European Community is fed to pigs and poultry. Removing the ban would undoubtedly increase this figure.
We, at Callander McDowell, wonder whether rather than removing the ban on feeding fishmeal to ruminant animals, the European Commission might consider extending it to cover its inclusion in all pig and poultry feeds too. We know that this isn’t going to happen but we have raised this possibility to highlight how absurd the whole issue of fish sustainability has become.
One of the objections to farmed salmon and other marine fish species raised by the environmental lobby is that it takes over 3kg of other fish to produce 1kg of salmon flesh. They claim that the harvesting of other fish species to feed farmed fish is depleting stocks of these wild fish, yet where do they think wild salmon and other marine fish get their feed. They certainly don’t go down to MacDonalds or shop at Tesco. They eat fish and other animals in the complex food chains that make up marine life. Farming is simply a way of improving the efficiency of the life cycle in order to provide an alternative source of fish for mankind.
Fish farming is the greatest management tool available to help protect stocks of wild marine species such as cod and haddock which are being over-fished towards extinction. The more farmed alternatives that can be provided in volume, the less fishing pressure will be put on wild stocks. Yet, whilst the environmental lobby is happy to endorse sustainable fisheries and ship these fish around the globe, they will not give approval to the existing aquaculture industry. Instead the industry is made to feel a pariah. As neither the MSC nor the environmental lobby will endorse the aquaculture industry, some retailers are reluctant to promote farmed fish as the only realistic alternative to wild caught species. They argue that they might consider doing so if they can be sure that the fishmeal used in the feeds is from sustainable sources. Meanwhile they are happy to see pig and poultry meat raised on fishmeal rich feeds being sold in their stores without any such guarantees, even though fish is a totally alien ingredient in the natural diets of these animals.
If the environmental lobby are so concerned about the sustainability of fishmeal, then why aren’t they focusing their attention towards the use of fishmeal in terrestrial farming? This is not only a bigger drain on stocks of those species used in fishmeal manufacture but they are not even part of the marine food chain.
Fish farming is the most effective way of ensuring consumers eat sustainable fish because it is a completely sustainable process. The sooner the environmental lobby recognise this then the more quickly wild fish stocks can be better protected.
Cheap as chips: IntraFish’s editor relates how his French neighbours like to eat fish because it’s good for their health. They are also preoccupied with making sure that their food is of the highest quality. They will not buy fresh Norwegian salmon because it is too cheaply priced. According to the editorial, in their world cheaply priced food equates to inferior quality food. They told the editor that when you can buy a kilo of salmon for five euros then that tells us it isn’t particularly good quality food. They added that they prefer to buy other fish or salmon that is associated with particular labels. The editorial concludes that it is a simple fact that some people, such as his French neighbours, get suspicious when salmon is so low priced as low price is synonymous with poor quality. It is for this reason the editorial believes that there is potential to develop ‘higher quality’ niche markets such as organic which will boost prices for salmon.
Whether such niche markets will develop much beyond current levels remains to be seen. Production of organic salmon is expected to reach 6-7,000 tonnes this year and yet even with such a small volume, at least four UK supermarkets are currently discounting organic salmon, which suggests that demand must be stimulated if consumption is to be increased. Whilst, the industry may consider producing more niche-market salmon to satisfy such consumers as the editors’ French neighbours, it may also consider an alternative strategy to disabuse them of their blinkered preconceptions. The reality is that that whilst these French consumers may believe that they can buy Norwegian salmon for €5/kg, they would be hard pressed to find any salmon at this price. Currently, the cheapest salmon we have found is €6.57/kg for whole fish and this is not even Norwegian fish but ‘superior’ Scottish.
This is being sold through a very popular independent fishmonger whose customers are very discerning and demanding. Not one of them would be prepared to buy inferior quality fish and would immediately complain if they were palmed off with anything but the best. Yet, the fish are priced at a ‘cheap’ £4.45/kg. Does this price make them poor quality? The number of customers buying this salmon would suggest not.
Price is not really the best indicator of quality. It is only necessary to look at Waitrose’s fish counter to find fish selling at around the €5 mark. Waitrose are renowned as the leading supermarket for the sale of fresh fish. They would be horrified if it were suggested that they sold poor quality fish yet they are selling Cornish sardines at £3.99/kg (€5.89/kg) and line caught MSC certified mackerel at £4.99/kg (€7.37/kg). Are these fish poor quality? We would think not. Instead, the price reflects the availability and this is also true for Norwegian (and Scottish salmon). Farming has meant that salmon are now widely available and this is what is reflected by the price, not the quality. Given the latest news that Icelandic cod quotas are to be cut, we clearly need to be producing even more fish by farming. Value for money farmed salmon is attractive to consumers and will relieve some of the pressure from cod supplies.
As a Norwegian, we would have thought that IntraFish’s editor would be insulted by the suggestion that fish produced by his countrymen are deemed to be of poor quality. Perhaps, he should invite his neighbours round for a dinner of Norwegian salmon to demonstrate how good farmed salmon really is.
Interestingly, on the same day that the editorial appeared, a columnist in the Manchester Evening News (perhaps not such a well known publication) wrote that having seen her bills for on line shopping at Waitrose rise by £60 a week she followed her mothers’ advice and went shopping at Aldi. Dianne Cooke was surprised by the prices and was surprised by the goods on offer. Her bill came to £97 as opposed to £179 at Waitrose and now Aldi is firmly on her shopping map. Just because Aldi are cheap, does not mean that the food is of poor quality as anyone shopping at Aldi will know. Ms Cooke has been converted but she does admit that in future she may buy a wig and dark glasses for future visits. Perhaps, it is not really about food quality but rather food snobbery.
Note: After the above was written, Tesco discounted whole salmon on a half price promotion. This means that whole salmon is available for a few days at just a few cents above the €5 mark. Whole salmon from both Scotland and Norway is currently priced at £3.49/kg (€ 5.15/kg).
It would appear that just as salmon prices are showing a slight upturn, some of the major retailers have started to respond to the previous price falls. It will be interesting to see whether these lower prices stimulate demand and whether the upturn in prices filters back through to consumers.