Our researcher was in France this week and spent two days going in an out of supermarkets and fishmongers. The developing picture is one in which salmon is taking more of a minor position in the retail sector. We are of course well aware that imports of salmon to France have remained robust even though prices have also been strong. Yet, much of this volume has probably been bought on contract at more reasonable prices. As a result, prices to consumers have remained relatively affordable and they continue to buy salmon. However what is noticeable is that salmon no longer dominates the fish counters and whereas once it used to be the feature of the display, it is now just another fish amongst many. There are examples where salmon still stands out – just, but these are now the exception rather than the rule.

The reason for this change is not the reduced availability of fish but rather the way that the price to consumers has been creeping up, not in the same way as spot prices, but still upwards, and this has deterred consumers who viewed salmon as a value for money choice.

The shrinking offering of salmon is apparent across each section of the supermarket. Chilled prepacks as less apparent, as are frozen products, but the real decline is in the range of smoked salmon products. An extensive range used to dominate supermarket displays but much has now disappeared leaving a reduced choice.

In the run up to Easter there are a number of deals and promotions on both fresh and smoked salmon in order to persuade consumers to buy salmon for Easter. Whole salmon can be currently bought for as little as € 3.95/kg which is the exact same price that IntraFish report that 4-5kg are selling for on the spot price in Norway.

The real danger is that if prices continue to rise, consumers will forgo salmon in favour of cheaper alternatives.

Certainly, a survey, conducted by The Perishables Group, of 13,000 US retailers found that price continues to dominate consumer behaviour in the fish and seafood market. They found that the response from most consumers about what drives their purchasing decisions was ‘Price! Price! Price!’

IntraFish reports the findings of The Perishable Groups’ research for 2008 but as their Executive Vice President says, 2008 was relatively level but consumer confidence has ‘fallen off the cliff’ during 2009. Consumers are definitely trading down or have cut back on either quantity or quality of the fish they have bought.  

In France, the presence of pangasius was more apparent on fish counters than it ever has been before. Perhaps, this is an indication that consumers are moving towards cheaper fish offerings, or at least that the supermarkets have recognised that consumers may be tempted by the cheaper alternatives. Interestingly, in the UK, pangasius, whilst openly available, does not seem to have taken off in the way that some commentators suggest. This is because the traditional species such as cod are still very competitively priced and consumers are sticking with what they know.

Rolf Domstein, Chairman of the Norwegian Seafood Export Council and CEO of Domstein does not believe that this is always the case. He told Dagens Naeringsliv that people are buying pangasius when they think they are buying cod. We, at Callander McDowell, are not convinced that this is happening, at least in the main retail sector. Firstly, everywhere that we have seen pangasius on display it has been properly labelled as Panga, Basa, Cobbler or Asian catfish and is mostly marked as originating in Vietnam. Secondly and more importantly, pangasius fillets look nothing like cod, even the colour is different. We suspect that it would be very difficult to hoodwink most fish buying consumers into believing that pangasius is cod.

We are aware of added value products that are made from pangasius which do not state which fish is used but equally, the labelling makes no inferences that it is any specific species just that it is white fish. It is only the shape of the fish in the product that gives the game away. The pricing of such products should also provide sufficient indication that the product is not made from cod.

Mr Domstein thinks that eco-labelling will help in the campaign to highlight the differences between cod and pangasius from Vietnam. We think that this is more a case of wishful thinking. A recent survey from SeaFish, which we have previously discussed, has shown that sustainability is not a high priority for most consumers. Instead, price is the main driver of fish sales. The reason that most consumers buy pangasius is because of the cost and no amount of eco-labelling will persuade them to pay more for a fish because of its sustainable credentials. We even know people who are actively choosing to buy pangasius because they like the bland taste.

Whilst price is clearly a deciding factor, Mr Domstein makes the point that eco-labelling does not guarantee a higher price. In a previous reLAKSation, we have already shown that Mr Domstein’s MSC certified cod sells at exactly the same price as cod without the eco-label. The real issue is that whilst his cod loin sells at £14.38/kg, the same store sells pangasius at £6.48/kg. For those consumers where price is important, cod loin, whether eco-labelled or not is no competition. However, the store is currently selling cod fillet at £8/kg and at this price, consumers may still be persuaded that cod is a better buy.

The fact that there is no financial benefit for certifying fish as sustainable comes as no surprise, yet it once used to be promoted as a reason for certification. Mr Domstein is not the only one to recognise that there is no reward for MSC certification. According to IntraFish, the Kodiak Daily Mirror spoke to Tom Sunderland, Marketing Director of Ocean Beauty Seafoods who told them that there is no commercial benefit to MSC certification and that it comes at a high cost.

Mr Sunderland said that there is absolutely no need for Alaskan salmon to be certified by the MSC. He was prompted by the ongoing debate as to whether the Alaskan industry should apply for recertification when it is due for renewal later this year. It has become a subject for debate because the Alaska Department for Fish and Game are no longer prepared to be the client or pay for the process. Instead, they say it is down to the industry itself and they now seem to be unwilling to pay the high cost of recertification when there is no benefit. They say it is clear that their salmon are sustainable and it doesn’t need an expensive label for consumers to recognise this. It is also clear that there is no alternative source of MSC certified Pacific salmon so if the market wants Pacific salmon, then it must go to Alaska to buy it.

We, at Callander McDowell, would suggest that not only should Alaskan salmon forgo MSC certification it should never have given it in the first place. Whilst Mr Sunderland says that Alaskan salmon is as sustainable without MSC certification as with it, the reality is that it is not sustainable at all. The so called wild populations of Pacific salmon require the release of huge numbers of hatchery raised in order to sustain them. This is not a sustainable wild fishery it is ranching or as the MSC prefers to call it, enhanced fisheries. If the fish were sold as ranched salmon then that is fine but most consumers are being misled into thinking that these fish are wild. If Alaskan salmon can be certified as sustainable by the MSC then farmed salmon should also be eligible for the certification process and they are not.

The level of influence that hatcheries have to the Alaskan salmon industry has been much downplayed in the past but seems to have recently come to the fore. Seafood.com have now reported that farmed hatchery fish make up Alaska’s largest agricultural product accounting for 34% of Alaska’s salmon catch. They suggest that this is a figure that Alaska might wish to keep quiet however we were sent the full story which was published in the Anchorage Daily News so it might now be a bit late.

The presence of hatcheries in the State of Alaska seems rather incongruous given their objection to the introduction of fish farming. It seems that there are 36 hatcheries, which are owned either by no profit organisations or the State. They raise a mixture of all five species of Pacific salmon for commercial or sport catches.

In 2008 1.5 billion baby salmon were released into the oceans last year with 60 million recorded as returning. Chum salmon from hatcheries account for 64% of the total Chum harvest, 44% for Pinks, 21% for coho’s and 20% for King salmon. Hatchery raised sockeye make up only 3% of the total sockeye catch.

In some regions, ranched salmon make up for most of the total harvest. In Prince William Sound, the figure is 91% whilst at the Cook Inlet it is only 4%.

‘You can put all the spin you want on farm verses wild/enhanced salmon but the truth remains the same. Farmed salmon taste bad, pollute the water and seabed where they are raised and promote disease, sea lice and viruses that are transferred to wild salmon. In BC Canada the courts have ruled that any fish that is put in the ocean is a public resource not some multi-national corporation. Take your propaganda some where else.’

The obvious point is that their hatchery raised fish are being introduced directly into the very same wild salmon populations that he says are threatened by farmed salmon. It makes no sense, but then in the whole word of eco-certification, what does? Maybe this is why the Alaskans now think that the MSC label is unnecessary.

A hatchery by any other name

Ray Riutaa of the Alaskan Salmon Marketing Institute told Seafood.com that he too believes the MSC label to be unnecessary. He said that some places such as Europe that value MSC certification might not choose to buy wild Alaskan salmon if it is not certified but as Alaska produces 80% of the high value sockeye, king and coho salmon, there is little other choice. However, it may not be the presence of the MSC label that dictates where markets continue to stock these higher value Pacific salmon species. In the UK, ‘wild’ MSC certified Alaskan salmon is not cheap to buy. In the current economic climate where price is everything and consumers are trading down, then it is possible that price and not its sustainable credentials that may decide whether consumers buy it or not. Yet at the same time, the typical customer for Alaskan salmon may not be affected as much by the credit crunch and may still be willing to pay more for the a sustainable fish even if it is not quite as ‘wild’ as the Alaskans would have us believe.