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What trends offer opportunities on the European frozen white fish market?

Takes about 10 minutes to read

On the European market for frozen white fish, demand for sustainability certification, quality labels and responsible sourcing is growing. Developments in both products and packaging reflect consumers’ increasing preference for convenience food. There are opportunities for new species, especially if you offer client-specific production.

Importance of sustainability certification is increasing

Sustainability certification for white fish species is becoming increasingly important, because consumers are becoming more conscious of sustainability issues relating to fisheries and aquaculture. Sustainability certification is therefore expected to become a market access requirement throughout northern and western Europe.

Marine Stewardship Council (MSC) and Friend of the Sea (FOS) are the most important certification schemes for captured white fish. For cultured white fish, the Aquaculture Stewardship Council (ASC) and Global Good Agricultural Practice (GlobalG.A.P.) certification have a leading position.

Note that in recent years, FOS also developed a consumer label for aquaculture products, the “Friend of the Sea (FOS) Add-On Module for Aquaculture”. There is integration with GlobalG.A.P.’s Integrated Farm Assurance Standard (IFA) V5, meaning that IFA V5 certified farms can also use the FOS logo.

The mainstream markets for white fish are increasingly demanding certified white fish products, particularly supermarkets in north-western Europe. The availability of ASC certified white fish products (primarily pangasius and tilapia) in 2017 shows that the Netherlands, Switzerland and Germany are the largest European markets for ASC certified white fish.

The number of ASC certified fish and seafood products in Europe has grown strongly since 2014. In 2017 as well, the growth rate is impressive in many countries; for example, in the Netherlands, this number stood at 940 in December 2017 compared to 360 in July 2016. For Germany, these figures are 844 versus 239, while “smaller” ASC certified product markets such as Spain grew sharply as well (101 versus 21). Supermarkets are the driving force behind this demand for certified fish. For example, 99% of the pangasius and tilapia that Dutch supermarkets offer is sustainably produced.

Overall, the numbers of ASC certified fish and seafood products are highest in western Europe, followed by northern Europe, southern Europe and eastern Europe:

  • western Europe: the Netherlands (940 approved products), Germany (844), Belgium (613), Switzerland (541), Austria (277), Luxembourg (17);
  • northern Europe: Denmark (351), Norway (145), the United Kingdom (126), Finland (105), Sweden (63), Ireland (24);
  • southern Europe: France (237), Spain (101), Italy (76), Portugal (49), Greece (25), Cyprus (16), Malta (6);
  • eastern Europe: Poland (41), Hungary (40), the Czech Republic (36), Slovenia (29), Romania (21), Lithuania (18), Slovakia (18), Bulgaria (17), Latvia (16), Estonia (5).

Tips:

  • If you are not yet able to supply certified products, focus on southern and eastern Europe. Buyers there have not yet made sustainability a common market access requirement.
  • If you are interested in becoming ASC accredited, contact the Dutch Sustainable Trade Initiative that supports exporters in moving towards ASC certification by providing them with technical and financial services.
  • If you are interested in becoming MSC certified or you want to know more about the MSC eco-label, contact the Licensing Team of the Marine Stewardship Council.
  • See our fact sheet about the organic seafood market in Europe.

Quality labels are becoming more important

Product and processing quality have continued to gain importance throughout the entire seafood sector. European importers increasingly expect their suppliers to comply with quality standards such as British Retail Consortium (BRC) and International Featured Standards (IFS). Although quality standards were previously of importance only in the retail segment, they are set to become an additional buyer requirement in all market segments in the long term.

If you are unable to meet European quality standards, it will drastically limit your market potential in a growing number of countries (also outside the European Union) and market segments.

Tips:

Convenience food remains hot

The demand for ready-to-eat, easy-to-cook value-added white fish products is increasing. Examples of such products are microwave products and fish snacks. The pressures of time and consumers’ unfamiliarity with preparing fish are the main cause of this trend. Consumers interested in such convenience products prefer meals that are quick to prepare but also healthy.

Examples of white fish species that are often used in convenience food products are:

  • pollock
  • Alaska pollock
  • pangasius

Tips:

  • To market your products successfully on the European market, work together with European importers with a good network throughout Europe. These importers should also be able to identify potential niche markets for your products.
  • Currently, certainly in terms of volume, the greatest addition of value to white fish products is taking place in Europe; for example, think of the production of fish sticks. However, because of price pressures, this may be outsourced to processors in developing countries in the long term. You should produce high-quality value-added fish products, as this enhances your business opportunities.

Greater acceptance of new species

Consumers in Europe are showing a growing preference for new and exotic white fish species. This is because consumers have better access to tropical fish products. In addition, the demand for high-quality fish products has been growing. Both developments have resulted in the acceptance of fish species that were relatively unknown before.

One recent example is the attempt to introduce cobia as a new tropical delicacy for the European market. Species that have successfully penetrated mainstream markets in Europe include pangasius and tilapia.

In 2016, pangasius had a share of 9% in European imports, behind cod, Alaska pollock (both about one third of the market) and hake (14%). Tilapia only accounts for 2% of the total European imports. More information on European imports by species is given in Figure 1 below.

This trend is expected to continue in the years to come and provides opportunities to anyone considering entry to the European market with new fish species.

Tips:

  • If you plan to introduce a new species to the European market, you need to conduct thorough market research in advance. After that, you should develop a detailed marketing strategy based on your research findings.
  • Also read our study of competition on the European frozen white fish market.

Innovation continues in packaging and preparation

Skin packaging (fish on a plate that is sealed with plastic wrapping) is cited as an up-and-coming way of packing fish products, because it improves the presentation. Another example of the development of innovative preparation techniques are steaming bags that can be easily used in microwaves and ovens. These steaming bags are increasingly found on the European retail market. This trend is also linked to the trend for convenience food.

Tip:

  • Try to work in close alliance with buyers to innovate your products further. This could also help you to decide whether or not to invest in new processing equipment.

Client-specific production is in demand

Product requirements vary widely throughout Europe. It is therefore important for you to produce white fish products that comply precisely with customer requirements. This can be achieved by working in close alliance with your European buyers.

In this scenario, you should be able to influence all parts of the production process, ranging from farming or fishing to processing. Moreover, you need to be flexible in terms of your product range. Client-specific production includes aspects such as farming on demand, packaging and portioning.

Tip:

  • Develop flexibility in your sourcing strategies to meet your buyers’ specific demands. Some buyers might only want to buy on a spot market basis, while others will want to have consistent volume.

Increasing demand for responsible sourcing

European buyers will increasingly demand that exporters have sustainable and socially responsible ties with their suppliers. To comply with sustainability standards as an exporter to the European market, you have the following options:

  • Prove that you have complete control over the production process.
  • Show your willingness to invest in production facilities.
  • Support your suppliers with making the necessary investments.

Investments that may be necessary can relate to the farm infrastructure or the fishing equipment that is required for compliance with sustainability standards.

Tips:

  • Ensure that you have a story for consumers, a story which underpins your product’s credentials and offers full transparency. This will provide you with business opportunities in higher market segments and will add more value to your product.
  • An option for sustaining your sourcing is to engage in formal buy-back system agreements, where you engage in long-term equal relationships with your suppliers.

Increasing emphasis on fish production in the European Union

The European Commission (EC) is emphasising that the European Union should become less dependent on the import of fish from outside Europe. This must also be seen in the context of growing competition for fish and fish proteins in previous periods from strong growing markets such as Brazil, Russia, India and China.

To achieve this, the European Commission and national governments are investing in increasing production through technological innovation and business support. In 2017, the European Commission launched two further € 14-million initiatives to enhance Europe’s aquaculture industry, PerformFISH and MedAID.

These efforts are not likely to increase production significantly in the short term. However, they may be successful in the long run and reduce the demand for certain species from outside Europe such as pangasius and tilapia in particular.

Examples of white fish species produced in Europe that might pose a competitive threat to imported species in future (including price) are sea bass and sea bream. For more information, see our study of competition on the European market for frozen white fish.

Tip:

  • Communicate with your business support organisation and make sure that they work together with the appropriate government department. They must keep track of the European regulations and develop a public-private strategy for compliance with European regulations. Public-private cooperation is a key factor for success in developing a strong position in the European Union.

Lower European import of Vietnamese pangasius

Europe is one of the largest markets for the Vietnamese export of pangasius, but the demand has been under pressure recently. This is illustrated by the declining import of pangasius in Europe in 2015 (by 14% compared to 2014). The pangasius sector in Vietnam faces several challenges, such as overcoming the added water scandal, high temperatures resulting in more diseases, and high competition from other white fish species such as cod and Alaska pollock.

Unfortunately, European imports of frozen pangasius weakened further during the first quarter of 2017. They declined by 15% compared to the same period in 2016. This trend was mainly due to boycotts on markets such as Spain and Belgium. Spain is Europe’s largest importer of pangasius, but its imports dropped by 9%.

As long as the European economy continues to show growth, it can be expected that pangasius consumption will remain under pressure and fail to recover from the previous decline in demand. As pangasius is considered a relatively cheap fish, its consumption comes under pressure when people have more money to spend. The trend of more certified white fish, including pangasius, on the European market could nonetheless support the consumption of pangasius.

Tip:

Weakening reputation of tilapia fish aquaculture

Europe is a relatively weak market for tilapia. In Germany, hardly anyone eats tilapia and the rest of Europe is following. In 2016, the tilapia fish aquaculture received negative attention due to the deadly Tilapia Lake Virus (TiLV). TiLV has caused great damage to tilapia fish stocks in Ecuador and Israel since 2009.

Another issue in Europe is caused by findings from recent studies of tilapia farming. These suggest that eating farmed tilapia may cause serious health damage such as asthma, inflammation, cancerous problems and more. Still, worldwide tilapia aquaculture production is expected to grow in the next years, because this fish is increasingly popular in developing countries.

Tip:

Stricter control on mislabelling fishery products

Mislabelling of fishery products is a problem in Europe. According to various studies, the level of mislabelling fish products on the European market is relatively high. A control plan was therefore established by the European Commission to assess and minimise mislabelling on white fish products with regard to its declared species in 2015.

Stricter control is necessary to improve consumer confidence and to strengthen the European market. As the control plan is still ongoing, no new changes in labelling are found. However, a traceability system and a Europe-wide labelling system might be introduced to prevent mislabelling. An overview report with findings and conclusions from a series of fact-finding missions was expected by 2017, but nothing has been published yet by January 2018.

Tips:

Please review our market information disclaimer.

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