USeless: Both the Daily Mail and the Times ran stories this week about a visit by a delegation from the UK seafood industry including the National Federation of Fish Friers to the state of Oregon on the Pacific coast of the USA. They were there to investigate the possibility of sourcing rockfish, Pacific perch, and hake for suppling the UK fish and chip shops sector.
The NFFF claim that massive price increases for cod and haddock are forcing fish and chip shops to seek cheaper alternatives. They say that there is a huge surplus of some US species that could take the pressure of needing to find expensive supplies closer to home. A recent survey predicts that half of Britain’s fish and chip shops could be forced to shut in the next three years because of rising prices. Of course, it is not just fish prices that are hitting the fish and chip sectors as high costs now affect all aspects of running a chippy.
However, Andrew Crook, president of NFFF, who runs a fish and chip ship in Lancashire said that most people come into a fish and chip shop knowing that they want cod or haddock and getting them to change to something else is very difficult. Yet if cod and haddock are the key to supplying British consumers, then why is he travelling thousands of miles to look at sourcing fish that would be unfamiliar to his customers? This is not the first time he has featured in the media about his overseas search for alternative fish species. Perhaps he should adopt a different strategy and look closer to home.
I have written before about the comments made by ex-BBC radio 2 DJ Chris Evans who when running a feature on fish and chips said that the species of fish used is largely irrelevant as it is the batter that is most important in making good fish and chips. I think he had a point.
Why chase after fish from the other side of the world when local fishermen land species that make just as good eating but cost less yet are seemingly just as unfamiliar to his customers. The 2021 Scottish landing statistics list five species with landings that total 38,000 tonnes, some of which had landing prices of around £1000/tonne such as ling and saithe. Why would Pacific perch or rockfish be more attractive to UK fish and shop customers than ling or saithe? In 2021, fish and chip shops sold around 24,000 tonnes of fish, so there is clearly plenty of cheaper UK species that could be used to supply local fish and chip shop. It is just a matter of chip shop owners seeing that fish and chips does not have to equate to cod and haddock.
Interestingly, most people talk about going for fish and chips rather than for cod or haddock and chips and I wonder whether over the years, it is the fish and chip shop owners who have created the image of cod and haddock rather than just fish and chips. How many of Mr Crook’s current customers might be persuaded to forgo cod and haddock if his chippy offered a fish and chip deal using an unspecified Scottish or UK landed fish at a better price than cod or haddock? I believe that loyalty to cod and haddock could be quickly tested.
The news that UK seafood representatives have travelled to the US to seek alternative supplies of fish is symptomatic of the blinkered vision now characteristic of the wider fish and seafood sector. This is also manifested in the next commentary.
Ditched: Intrafish reported that younger generations in the UK are now ditching fish and seafood at an increasingly fast pace. This is claimed to be the result of the financial crunch that has been especially hard on the youngest consumers. Instead, the seafood sector is increasingly reliant on purchases by older consumers. These are the findings of the latest research from Seafish who have identified that only 11% of seafood is purchased by the 16-35 age group. This increased to 15% for the 35-44 age group. By comparison 45–64-year-olds account for 37.4% of sales whilst those over 65 make up the remaining 36.7%.
Seafood consumption in the youngest age group fell by 15.4% between 2020 and 2022, whereas the oldest age group saw an increase of 7.2%. The two mid-range groups showed different changes with one down by 4.9% and the other increasing by 0.8% respectively.
Seafish say that historically, the primary seafood consumer demographic has always been over 50 and affluent, however for how long this has been true is unclear. I have Seafish data from the late 1980s which supports this view but equally, when I was growing up, I certainly remember seeing fishmongers’ shops in less affluent areas. Equally in more recent times, I have observed fishmongers close down who were located in some of the most affluent areas of the UK.
It was this early Seafish report that got me interested in consumption. It provided an explanation as to why older people ate more fish which did not resonate with me. It said that younger people were busy raising families and had little time or money to buy and cook fish but that older people, whose families had now left home, did. The implication was that at the age of 45, consumers who had previously not really eaten fish and seafood suddenly started to do so.
I have always wondered if there was a better explanation to the age divide in fish consumption and I believe that older people grew up as shopping habits changed from High Street shops to the large supermarkets. In their younger days, they were more familiar with eating fish that came from the local fishmonger but as supermarkets expanded and convenience food took an increasing share of the market, younger consumers moved away from fresh fish. The fact that most supermarkets have dropped their fish counters highlights this point. The big question is that as the current 60-year-old age group who do like eating fish age and pass on, will they be replaced by those who are now in their 30s and 40s. I believe that unless the fish and seafood sector adapts to the needs of these younger consumers, the answer will be no, and overall consumption will continue to fall.
The following graph shows the age-related consumption of fish and seafood in the 1980s:
In the 1980s, the divide between under and over 45’s was 34.6% and 65.4%. Now it is 26% and 74%.
Intrafish say that in the latest report, Seafish have observed that consumption by younger age groups did increase during the pandemic, but now, it is the younger and less affluent consumers who have stopped buying seafood. Of course, many consumers changed their eating habits during the pandemic simply because cooking helped fill in time spent at home during lockdown. It is likely that these younger consumers now have found better use of their time and returned to more convenience cooking. Seemingly, the only glimmer of light is that the younger age groups are buying fish and seafood in the form of sushi.
Meanwhile, food inflation is increasingly hitting all consumers and whilst overall consumption increased significantly during the pandemic, it peaked in July 2021 and since then has been in decline. Consumption is currently around 30,000 tonnes below peak. This will not just affect younger consumers but will hit all consumers. In addition, declines of seafood have previously not been reflected in the salmon sector but now even consumption of salmon is falling. It simply costs too much for many consumers.
Peak salmon: iLAKS wrote a commentary saying that in 2014, the Financial Times had reported that the salmon farming sector had reached ‘peak salmon’ with no potential for further growth. This was based on the view that there were question marks over the availability of fishmeal, limitations on geographic farming areas, disease, and environmental concerns. The Financial Times reported that the issue of fishmeal availability was raised by Andy Sharpless, the CEO of the environmental organisation Oceana, but like most NGO’s, Oceana’s knowledge of aquaculture is limited to a few oft repeated claims from other environmental groups. Mr Sharpless failed to realise that fishmeal was not a limiting factor in production growth. iLAKS point out that since 2014, world salmon production has grown by 34% equivalent to 700,000 tonnes so the predicted peak salmon clearly failed to materialise.
iLAKS say that the idea of peak salmon reappeared at the recent Barcelona exhibition as the subject of many conversations. Whilst governments in Norway and Scotland constantly talk about the opportunities presented by salmon farming, their actions suggest the exact opposite with traffic lights and risk frameworks, increased rents, and higher taxes. iLAKS argue that such factors deter investment in growth so that this time it is the industry who are promoting zero growth and thus peak production.
Of course, iLAKS say that there are many who are happy with peak production as it keeps prices high, although higher prices have now attracted higher taxes. If production fails to meet global demand, then the fish will be directed to those markets that are willing to pay the most and the less well-paying markets will shrink or disappear. iLAKS says that the industry pioneers were attracted to salmon because wild salmon was perceived to be a high value food for the affluent consumer. They ask whether it is possible that farmed salmon could return to this market niche.
The problem is that back in the 1980s salmon production was relatively small and thus salmon could be perceived as being special even if demand was high. However, as production increased, high volumes devalued this special image, so salmon became an everyday food. This was good for both the industry and the consumer. The problem now is that although demand is high, production is still huge, and experience would suggest that it is impossible to create a high value image out of something produced in huge volumes. If we consider the market for cars, would affluent consumers be prepared to pay the high price for a Rolls Royce or Aston Martin, if they were produced in the same volumes as the mass market Ford Fiesta. Farmed salmon is never going to return to a high value product as it once was as the volumes are simply too great.
High volumes do not mean that the fish can be too expensive for some markets. Consumers around the world have different perceptions and expectations and these can be exploited by the industry. However, it is unlikely that such perceptions can be maintained over longer periods of time.
In my opinion, the idea of peak salmon now is the consequence of stock market listings for salmon farming companies in which investor needs outweigh those of the consumer. Peak salmon is also the result of the widely reported current food inflation.
I have written previously that the salmon farming sector does need to decide what sort of industry it wants to be. Does it want to limit production to maintain high prices to satisfy the investor or does it want to expand, diversify the market, and satisfy the needs of the consumer? My view is that without a healthy consumer base, the salmon farming industry might lose its purpose and be just another commodity on which investors are able to take a gamble.