in choppy waters
Article appeared in issue 6, 2022
Ireland’s seafood industry, like so many others, has had to navigate the choppy waters of Covid-19 over the last few years. In the wake of the pandemic, opportunities certainly exist but the voyage ahead looks challenging, Senior Manager Alcohol and Seafood, Bord Bia (Irish Food Board), Michael Hussey tells Irishfood
According to Bord Bia’s Performance and Prospects Report 2021-2022, overall exports of primary Irish seafood returned to growth in 2021 – up by 12% and reaching €514 million when compared to 2020. Exports to the EU in 2021 were up by 13%, from €285 million in 2020, with the post-Covid-19 reopening of foodservice playing a large part here. Asian exports grew by almost 51% last year, shellfish exports were up by 44%, and pelagic exports recovered well also. This growth represents a recovery from a very difficult 2020 due to disruptions caused by pandemic lockdowns.
While these figures are for primary seafood exports, added-value seafood increased by almost 27% in 2021, to €96 million, when compared to 2022. These added-value products include smoked salmon and retail-ready – cooked or otherwise – added-value seafood. This sector has been performing strongly in recent years in response to consumer demand and this trend looks set to continue in the years ahead, returning a much higher price, per kilogramme, to the sector.
Irish seafood markets in 2021
China, Japan, and Hong Kong Exports accounted for over €38 million
Africa Exports were up by 5% to just over €97 million, with pelagic species performing well
UK Primary seafood exports were down by 9%, to almost €38 million, with a fall of almost
43% in the value of whitefish exports, but growth of 38% in freshwater exports
This return to growth is very positive but, Michael explains, it exists alongside real challenges to the industry too. Rising energy costs are affecting both seafood processors – especially those who are cooking product or adding value to product – and fishermen.
“They aren’t going out as often because of the cost of marine diesel, and when they are going out, they aren’t going out as far,” he says.
“It emphasises, for us, the need to add value to the product that it is caught [here]. We are still seeing quite a lot of product – frozen, head-on, both white fish and pelagic species – being sent abroad for processing to the likes of China.
“So, we see opportunity in adding value here in Ireland – gutting, filleting, and putting it into consumer-ready packs so that it can be exported as it is with value added in Ireland,” Michael explains, adding that the reduced catch volume recorded in 2021 is likely to be repeated once again in 2022.
Making more from less
Adding value to a smaller catch will become increasingly important in light of the EU-UK Trade and Cooperation Agreement (TCA), part of which has established new management of, and quotas for, shared fish stocks in EU and UK waters.
According to Bord Bia’s Performance and Prospects Report 2021-2022, Ireland’s pelagic sector experienced a ‘difficult 2021 with a cut to the all-important mackerel quota’ as a result of the TCA.
“The quota that is allocated to Irish fisheries [for mackerel] will fall by 26% by 2025. That’s quite a large amount and it’s already having a significant impact on the amount of product being landed,” Michael says.
“White fish species are also being badly affected by the TCA, which means there is less product available for export and for processing,” explains Michael.
The quota reductions for Ireland have been described by the Minister for Agriculture, Food and the Marine in Ireland, Charlie McConalogue, as being ‘disproportionate compared to other Member States and will lead to an estimated loss of €43 million per year in fish quotas when the reductions are fully phased in by 2026’. With less product available for export and for processing, making more from less will be a key priority for the seafood industry.
The impact of the Trade and Cooperation Agreement on Ireland’s fish quotas
A 26% reduction in Ireland’s western-mackerel quota share;
A 14% reduction in Ireland’s largest non-pelagic (prawns) quota share;
Notable reductions in hake (Celtic Sea) 3%; haddock (Celtic Sea) 11%; haddock (Irish Sea) 16%; haddock (Rockall) 22.6%; megrim (Celtic Sea) 8%; megrim (West of Scotland (19%); anglerfish/monkfish (Celtic Sea) 7%; anglerfish/monkfish (West of Scotland) 20%; and Pollack (Celtic Sea) 9%;
A reduction of 96% for herring (Irish Sea).
Source: Department of Agriculture, Food and the Marine, Ireland.
One way that the industry can offset the impact of the TCA is to ‘attract foreign landings’ which can help Ireland to move away from dependency on the Irish quota-catch volume. “This is where you have, for example, Norwegian or Scottish boats fishing in the Irish seas, and you give them the option to land in Irish ports, so their catch is processed in Ireland,” Michael explains.
“It is one way the industry is aiming to keep factories busy. We attracted 110,000 tonnes of foreign landings last year and the hope is that this will continue.”
The industry is rising above other challenges too. Even though export volumes are down, export values are moving in the right direction, he says.
“Looking at the Central Statistics Office export figures from January to August [this year], they are up about 6% year-on-year in value, but the volume is well down on the previous eight months. What we are seeing is a substantial rise in the price per kilo. This is to be welcomed given the rise in input costs for both the fishermen and processors,” Michael says.
One of the main reasons for this increase in price is the strong consumer demand for a product that is healthy and nutritious. “We expect volumes to remain substantially lower for the rest of this year, but the value should stay ahead for the full year.”
Sustainability is proving to be a key consideration for consumers of seafood and the more the industry responds to this, the better it will be for it.
“The industry operates to the strict quotas that are applied – so that the stocks are maintained for future generations – as well as regulations laid down by the Seafood Protection Authority also,” Michael explains.
“And most Irish seafood companies working with Bord Bia are members of Origin Green (Ireland’s national food and drink sustainability programme), so they have their sustainability plans in place, and they recognise that when they are talking to customers, they have to have a sustainability plan that they are working to.”
Bord Bia’s Performance and Prospects Report 2021-2022 states that the industry remains positive about its ‘ability to grow in an increasingly diverse range of markets across the EU27, Africa and Asia as normal business resumes’.
“There are new product-development opportunities in the retail channel, with growing consumer demand for more ready-to-cook whitefish product formats, particularly in traditional seafood markets,” according to the report, and this is key to further success for seafood companies at home and abroad.
Seafood companies like Keohane’s and The Good Fish Company are some of the Irish innovators that are adding value to their product by making fish meals available to the consumer that are healthy, simple to prepare and cook, and delicious to eat.
Market diversification is also a key aim, Michael explains: “There has been an emphasis within the industry on moving away from the UK markets given the regulations around the Brexit agreement. We have been more focussed on European markets, such as the French and German markets for fresh salmon. We have successfully opened more markets in Asia, and Vietnam has really come on stream in the last three to four years. It is a good market for lobster and crab.”
Salmon is Ireland’s primary export product for the Middle East; it is not a huge market and is quite competitive. “We are up against Scotland and Norway and, last year, we had an issue with supply but this year we are hopeful that the volumes will be back up to even above where they were in 2019.”
According to Michael, the biggest opportunities for Irish shellfish in the EU lie in foodservice channels in French markets, in particular, while for salmon, the retail route is key, particularly in Germany and France. And there are further opportunities to grow these markets.
“We are selling a fully organic [salmon] product and all product coming out of Ireland for salmon is certified organic, so we command a premium for it. We see further opportunities in those markets. We promote the product through key retailers and into the trade as well.”
In terms of the higher-value Asian markets – Japan, Korea, Vietnam and China – foodservice is also key and Bord Bia is ‘constantly looking at opportunities in those markets’, Michael says.
“We do that in a number of ways. We attend key trade shows, organise and execute online-media campaigns targetting key buyers and influencers, and we run chef-ambassador programmes where local chefs endorse Irish products and use them in their recipes, and we then run online campaigns around that.”
Research to reap rewards
Research recently carried out by Bord Bia, contained in the Seafood Futures: Four Marketplaces of Tomorrow report, unveiled four strategic priorities for the seafood sector to help it deliver on its vision: that customers around the globe recognise that Irish seafood is world-class, that it is truly different, that it offers a wealth of benefits – among others. A synopsis of the four areas, are featured below.
Greater investment in technology and innovation can help Ireland meet existing or new trends like convenience, with smart solutions across taste and indulgence. Greater digital investment can ensure that Ireland’s seafood story is told in a more targetted and efficient way, and by imitating the success of Ireland’s organic salmon sector, the role of Irish seafood and its specific benefits will be clear and understood.
There is a recognition that the sustainability agenda has accelerated rapidly and getting ahead of this trend will provide a premium differentiation opportunity for seafood from Ireland. Across many retail markets and increasingly the foodservice channel, increasing numbers of customers are insisting that a sustainable certification will be required to maintain market access. The Irish seafood industry has made good strides with the development of the Fishery Improvement Projects (FIPs) in 2017, but much more will need to be done to increase membership, to broaden the FIPs to include all key species exported from Ireland, and to embrace new digital technologies to demonstrate the traceability and provenance of Irish seafood caught and processed by FIP members.
Ireland needs to position Irish seafood as a nutrient-dense, high-quality and lower-fat protein communicating both nutrition and sustainability-led benefits. Value-added products with these messages will offer the greatest potential for premium differentiation. Animal welfare will become an increasingly important decision-making factor within the marketplace demanding that seafood is produced in a way that respects both the life and the death of the species.
Optimising re-imagined channels
As the e-commerce channel continues to evolve and the foodservice industry starts to pick up again, there are further opportunities to explore and new customers and consumers that the sector can target. Successfully targetting these channels and customers will require the sector being able to offer something different with a view to delivering additional benefits. This could be through digitisation, supply-chain innovation, sustainability or efficiency technology. Bord Bia recognises the need to ensure that it delivers insight-led innovation built upon market-led and verified consumer needs, and its innovation strategy seeks to strengthen the synergies with other Irish state agencies.