Key Buyer 2018 Industry Update

SUMMER EDITION

FOODSERVICE

Restaurants prep for higher holiday prices

RETAIL

Unwrapping retail’s “elegant” seafood season

Policy

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SUMMER EDITION

DIGITAL PRODUCT MANAGER Michelle McNickle / mmcnickle@divcom.com EXECUTIVE EDITOR Cliff White / cwhite@divcom.com EDITOR Madelyn Kearns / mkearns@divcom.com

Key Buyer 2018 Industry Update CHANGE IS IN THE AIR. With a blink, spring has transformed into summer. Ovens have been switched off and the grills have been rolled out. Sweaters have been traded in for bathing suits and beach towels. And for the seafood industry, new innovations, ideas, and trends have been subsuming tradition and gaining prominence at a blistering pace.

An increasingly adventurous approach to the seafood category has started to ripple up and down the supply chain, and is expected to make a splash when the industry’s annual buying cycle revs up for another round this winter.

Suppliers, retailers, and restaurants alike are embracing underutilized species as prices rise for traditional holiday seafood stars such as lobster and crab. Moreover, seafood-sellers of both classic species and new species are venturing into novel terrain – including the comfort food segment and premium product development – to attract adventurous consumers hungry for new dining experiences at home and out on the town. Importers, too, have been navigating layers of change, with developing policies and trade negotiations altering the way the United States handles seafood from both domestic sources and from abroad.

There are, of course, some things that remain constant within this environment of rapid industry evolution. For one, SeafoodSource continues its vigilance in investigating and analyzing key buyer trends shaping today’s North American seafood industry, and has produced this guide to keep you informed regarding the many moving parts impacting your businesses.

So, kick back and relax with this latest edition of SeafoodSource’s Key Buyer Industry Update, which touches on consumer trends, pricing predictions, policy development, and more.

We’ve got you covered – but still, don’t forget the sunblock.

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03 INDUSTRY UPDATE

SeafoodSource

04 ADVERTISER INDEX

TABLE OF

CONTENTS

06

Tis’ the (SIMP) season

Nontariff trade barriers in seafood likely to increase costs for importers

By Chris Chase

12

16

Festive foodservice Restaurant buyers prep for higher holiday prices

By Christine Blank

Spread the love Suppliers encourage consumers to embrace underutilized species

By Chris Chase

20 5 questions with Dish on Fish A D INDE X C1 13 25 05 23 19 C3 07 15 09 C2 17 C4 11

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By Madelyn Kearns

22

Small portions, big opportunities

Consumers favoring smaller bites, to seafood’s benefit

By Madelyn Kearns

26 Unwrapping retail’s “elegant”

seafood season

By Madelyn Kearns

Summer Edition

POLICY

Tis’ the (SIMP) season Nontariff trade barriers in seafood likely to increase costs for importers

By Chris Chase

O

ver the past few years, new regulations program, initiated by former U.S. President have been put in place in the United Barack Obama’s administration, requires the “At this point we don’t States, increasing the regulatory burden on importer of record to obtain an international have any market indicators importers bringing seafood into the country. fisheries trade permit and keep records of that illustrate how SIMP is These new rules, such as the Seafood Import the chain of custody of the fish or product affecting the volume and Monitoring Program (SIMP) and the shift of from its harvest point to its entry into the price of seafood imports, pangasius inspections from the jurisdiction United States. but there is no question that of the U.S. Food and Drug Administration to Those additional records requirements, it will increase expenses.” the U.S. Department of Agriculture, are likely according to Gavin Gibbons, vice president increasing costs on seafood imports. On 23 of communications for the National Fisheries March, 2018, seafood companies dealing in Institute, are going to drive up costs.

“At this point we don’t have any market indicators that illustrate shrimp received another blow, when shrimp was added to the list how SIMP is affecting the volume and price of seafood imports, but of species that are part of SIMP. The first phase of a risk-based traceability program, SIMP requires there is no question that it will increase expenses,” he said. “You importers of Atlantic cod, blue crab, dolphinfish, grouper, king crab, don’t add an unnecessary layer of bureaucracy to any value chain Pacific cod, red snapper, sea cucumber, sharks, swordfish, tuna, and not have it impact the cost of doing business.” shrimp, and abalone, to record and keep key data on hand. The The NFI previously was part of a group that sued the government 6 | 2018 KEY BUYER INDUSTRY UPDATE

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over its implementation of the rules, citing vastly increased costs to American companies.

“The Seafood Import Monitoring Program (SIMP) remains an expensive burden for the American companies that will bear the costs, for instance USD 53 million [EUR 44.1 million] in recordkeeping expenses alone,” NFI President John Connelly said in a press release about the lawsuit back in 2017. “NFI has a long history of supporting the reasonable authorities Congress provided to administrations to combat illegal fishing. These additional regulations will not decrease pirate fishing. The SIMP will though, increase food prices and reduce seafood choices for the average American family. NFI will thoroughly review the court’s decision and as always our members will comply with the law.”

“I do think it will hurt the foreign suppliers more than the importer, and I think it will increase the cost of U.S. seafood to the American consumer.”

Much of the information requested by SIMP isn’t something difficult to come up with, said Benjamin England, founder and CEO of FDAimports.com – it just adds an additional regulatory burden to keep track of.

“The problem is… is that everyone is pushing traceability and supply chain so much, it’s almost like well, we already have the data,” England said.

The latest addition of shrimp to SIMP will almost certainly have a significant impact on costs, but it’s unclear how much impact it will have on the volume of imports that will come in. Shrimp is, by far, one of the largest imports to the United States, with billions of pounds entering the country each year. England said he expects that amount will hardly slow in the face of SIMP. “You’re not going to stop the importation of shrimp into the United States,” he said.

England said adding shrimp to SIMP seems like an “easy” way for current U.S. President Donald Trump’s administration to appear tough on trade, while also benefitting the nation’s domestic industries.

“It feels like low-hanging fruit to me. It feels like the kind of thing that’s going to be a pain,” England said. “I do think it will hurt the foreign suppliers more than the importer, and I think it will increase the cost of U.S. seafood to the American consumer.”

Adding pangasius to USDA jurisdiction is a similar nontariff barrier that England said won’t do much aside from increase the costs of importation, given the large amounts of overlap between existing regulations and the USDA’s requirements.

“All it did was increase the cost,” he said.

All those additional regulations, England added, likely won’t see much benefit in the sectors they were supposed to help. “I don’t see a significant public health or environmental or conservation win out of SIMP,” he said.

Those within the U.S. domestic shrimp industry disagree, and see it as a win for the American consumer. The Southern Shrimp Alliance – which represents fishermen, processers, and more in the eight warmwater shrimp producing states (Alabama, Florida, 8 | 2018 KEY BUYER INDUSTRY UPDATE

Georgia, Louisiana, Mississippi, North Carolina, South Carolina, and Texas) – said SIMP is a powerful tool.

“We believe the SIMP program provides one of the most powerful tools ever created for ensuring that imported shrimp is legally produced Benjamin England and legally traded,” said SSA’s Deborah Long.

The benefit extends to more than just the U.S. domestic industry and consumers, Long said: “In addition to U.S. shrimp fishermen and processors, legitimate law-abiding seafood importers will also benefit from not having to compete with shrimp that was produced with slave labor, or with harmful and illegal antibiotics, or in foreign fisheries that operate outside the law.”

England conjected that the increased enforcement of regulations like SIMP, coupled with adding some seafood species under existing regulatory bodies, is a way for the Trump administration to have an impact on trade without directly venturing into tariffs, to the benefit of domestic U.S. industries.

“It’s almost like, well why seafood, other than it was easy to do and I think there is some stroking going on of the domestic industry,” England said. “We’re just looking at the low-hanging fruit that the administration could pick in order to affect a trade, in order to try to force people (countries) to the table for things that matter.”

Additional regulations aren’t even necessary to affect trade – simply enforcing existing ones strictly will, and already does, have an impact, according to England.

“I’ve been saying for a while that the Trump administration does not have to renegotiate trade deals to have an effect on trade,” said England. He gave Customs and Border Protection (CBP) Form 28 as an example. Known as a request for information, CBP Form 28 is documentation required when something is imported and the importer makes a declaration that it enjoys a preferential, or zeroduty rate. The form, and information, is required to be on-hand at the time of declaration.

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POLICY

Previously, enforcement of that requirement wasn’t always strict, and even if it was requested, importers would often ask for an extension that was usually granted, said England. The impact to trade tended to be minimal.

“Now, all they have to do and they’re doing this, is not give extensions, and citing as part of the violation that you’re supposed to have the records at the time of declaration,” said England.

Regardless of the real purpose of the nontariff barriers, any further impact of regulations on trade in seafood between the United States and China could have negative ramifications, said Gibbons. “A trade war with China that affects the seafood industry would negatively

“A trade war, with respect to seafood, could have lasting and possibly serious unintended consequences.” impact American jobs. There’s a lot more at stake than the potential for higher seafood prices. The raw materials that are ultimately sold in retail stores and restaurants are also served, processed, value added, shipped, packed and stored by U.S. workers,” he said.

Conservation efforts on U.S. shores would also take a severe blow if imports were impacted by trade policies. The demand for seafood products in the United States far outweighs what can be produced domestically in a sustainable way, Gibbons explained.

“This is not a case where we could just make more of the raw material here, we’re not talking about steel. In order to continue to successfully manage our fisheries here we need imports. We can’t simply pull more fish from our waters,” said Gibbons. “Our seafood resources are overseen by NOAA and have a positive sustainability story because we don’t over-exploit the resource. A trade war, with respect to seafood, could have lasting and possibly serious

unintended consequences.”

Predicting whether a fullfledged trade war will happen requires a crystal ball, according to England. However, he was willing to predict that of the seafood products that regulatory efforts would go after, largevolume products like shrimp and Gavin Gibbons pangasius would be the likely targets.

“In both those cases you have enough volume, and you have enough value,” England said. “That’s always the big thing, do you have enough substantive value in the shipment.”

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FOODSERVICE

Festive foodservice Restaurant buyers prep for higher holiday prices

By Christine Blank

Photo courtesy of The Hourly Oyster House and Joel Benjamin

O

yster, lobster, shrimp, and “Lobster has been significant in “Oyster, lobster, shrimp, and halibut dishes halibut dishes – along with terms of dollars across the board – — along with “comfort foods” such as “comfort foods” such as seafood for any type of lobster that is being pot pies – are expected to be hot on utilized, whether it is Australian, seafood pot pies — are expected to be holiday menus this year. However, Canadian, or South American,” said hot on holiday menus this year.” for some of these species, sourcing Sam D’Angelo, CEO of Samuels & reasonably-priced quantities may Son Seafood, a wholesaler based be a challenge. in Philadelphia, Pennsylvania. “We are just about the halfway point in the year, and we think it is going to stay pretty strong based on “Last year, we featured a Fried Green Tomato Lobster Stack the economy and the increased demand out there.” appetizer, along with a lobster roll, [but] we are concerned about pricing on lobster,” said Virginia Pivonka, director of procurement “Lobster is always huge for us. Who knows what is going to and marketing for the 11-unit Rockfish Seafood Grill, based out of happen with the lobster market, but it is a luxury item and we will Richardson, Texas. continue to offer it – possibly at a higher price,” said Andrew Gruel, As a result, the chain will evaluate how the lobster meat market CEO and founder of Huntington Beach, California-based Slapfish, fares after this summer and determine whether Rockfish will cover which currently operates 13 restaurants and counting. “It’s a matter of trying to figure out how to stretch the dish.” a higher potential cost or take the species off its fall and winter menus, Pivonka said.

For past holiday seasons, Slapfish has done well with lobster

12 | 2018 KEY BUYER INDUSTRY UPDATE

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FOODSERVICE

mac ’n’ cheese and lobster bake dishes, and will likely offer them again this year, according to Gruel.

Like lobster, D’Angelo said he is seeing much stronger prices on “every crab out there,” whether it is blue crab meat from Indonesia, Alaskan snow and king crab, red crab from Asia, or Canadian crabs.

“Crab is going to continue to be in tight supply and priced high,” D’Angelo said.

“The pricing on pasteurized crab meat is definitely up, and it looks like it’s going to be another record year,” added John Rezny, vice president of purchasing at seafood distributor Fortune Fish & Gourmet in Bensenville, Illinois. While some buyers switch to a different type of crab, many buyers will use a blend of jumbo lump and claw crab for their dishes, rather than using 100 percent jumbo lump, he said.

Alaskan halibut prices were strong last holiday season, and buyers expect them to be high again this year. As a result, Samuels “For the two weeks of Christmas into New Year’s, & Son is nudging foodservice start looking into it [their holiday we feature dishes like Chilean sea bass, buyers toward farmed halibut. menus and seafood markets] in stuffed salmon, and stuffed halibut — things August,” Rezny said.

“We will bring it in from Norway, after the Alaskan season. It that are in the upper price range.” brings in some price stability Luxury dishes in for planning for the holiday,” the limelight D’Angelo said.

Despite stronger prices on lobster, crab, and other species, diners Buyers can contract the still demand luxury items during the holiday season – and restaurants farmed halibut at a “reasonable will continue to feature those items on their menus. price” for three or six months at “For the two weeks of Christmas into New Year’s, we feature a time, D’Angelo said. dishes like Chilean sea bass, stuffed salmon, and stuffed halibut – things that are in the upper price range. People are out celebrating Even farmed salmon – and their budgets are a bit bigger,” Rockfish’s Pivonka said. featured on many restaurant chains’ holiday menus – is Similarly, The Hourly Oyster House in Cambridge, Massachusetts, expected to be higher priced will likely feature “luxurious” seafood such as halibut, a version of than in previous years. “Farmed lobster thermidor, “or some creative interpretation using the unsung salmon [price] seems to be hero, monkfish. We could play around with a monkfish wellington, escalating quite quickly, and we paired with truffles and Madeira, for New Year’s Eve,” said Mark think that will probably continue Golberg, culinary director at Grafton Group, which operates the for the rest of the year,” said restaurant. “Local lobster always manages to find a place on holiday D’Angelo, who attributes the price hike in part to increased demand menus as well,” he added. from India and China. “We cannot supply them with enough fish. As Throughout the holiday season, The Hourly Oyster House features their middle classes continue to grow, it’s one of the items they are three or four creative dishes to augment its current menu. Since buying more of,” he said. consumers are generally eating lighter and healthier, the restaurant D’Angelo urged buyers to consider non-traditional holiday fish may feature a lighter dish, such as one it offered for Mother’s Day such as halibut, corvina, cobia, mahi, and tuna for their seasonal this year: lobster quiche, served with mixed greens, according to menus. He also suggested that buyers include farmed and wild Goldberg. shrimp on their menus as an addition or replacement for lobster “Creating dishes/menus that offer value is our top priority. and crab.

Sourcing great product, cooking them properly, and adding some “Shrimp has been such a good value over the last three months, creativity seems to be a recipe for success. Looking back on previous that we are encouraging a lot of our customers to focus on shrimp holiday menu sales is always a good exercise. There is a lot we can through the end of this year,” D’Angelo said. learn from our successes (and those not so successful),” Goldberg said.

D’Angelo expects Argentine red shrimp to continue to be a good value. “There is an oversaturation in the market… and we feel like Oysters “hot” for the holidays the demand will not exceed supply at this point,” he said.

Since oysters of all types have become more popular on Fortune Fish had some large restaurant chains looking at restaurant menus throughout the country, eateries are planning to capitalize on the trend throughout the holiday season. contracting for shrimp in May 2018, but many are waiting to contract for other seafood items until closer to the holiday season. “Most guys “Winter is better for shellfish and oysters and, given the fact that 14 | 2018 KEY BUYER INDUSTRY UPDATE

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FOODSERVICE

oysters are hot right now, we will do a lot with oysters – steamed, baked, and raw for the holidays,” Gruel said.

In addition to serving oysters in its restaurant locations, Slapfish will also prepare the shellfish for customers to take home with them. Staff will shuck the oysters, store them on rock salt, and then customers can broil or prepare them at home. “People are willing to be a lot more adventurous at home, especially with seafood, so that is one element that we are going to ramp up for the holidays. There are so many fun, value-added opportunities for oysters,” Gruel said.

The Hourly Oyster House will likely offer multi-tiered raw oyster displays for New Year’s Eve, as well as oyster stuffing for Thanksgiving – all utilizing local oysters, according to Goldberg.

“We do a lot of work with local lobstermen and local oyster growers. It’s these small fisherman/farmers that are really keeping the integrity of the craft and product,” Goldberg said. The restaurant’s local seafood suppliers include: Buy New England Lobster, Snappy Lobster, Island Creek Oysters, and Spearpoint Oyster.

Goldberg’s advice for other foodservice buyers? “Buy your product as fresh as possible, as close as possible to the

holiday. Don’t over-purchase. In my experience, local products sell better than those products shipped from further afield.”

Menus cozying up to “comfort foods” Innovative “comfort foods” are also expected to perform well on holiday menus. Last year, Rockfish added a “Salmon Wellington” to its holiday menu, which ran from 1 November to 31 December, 2017. The dish performed so well that the chain will likely include it on this year’s holiday menu.

Heavier winter comfort foods, such as “Cajun Pasta and Seafood Pot Pie,” have also performed well in past years, according to Pivonka.

Slapfish has had success with its “Chowder Pie” offering during the holiday season. “We start with New England clam chowder, and then top with salmon and shrimp, in a puffed pastry crust,” Gruel said.

Rockfish may even add a poke bowl to its holiday menu, depending on how the dish performs on its summer menu. “Our chef, Matt Baum, loves Asian cuisine, so I could see him coming up with some sort of seasonal bowls,” Pivonka said.

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SUPPLIER

Spread the love Suppliers encourage consumers to embrace underutilized species

By Chris Chase

“When it comes to seafood sales in the United States, the facts are undeniable.”

I

t’s well-known that three species make up the lion’s share of consumption by consumers. Those species – shrimp, salmon, and tuna – have historically been at the top of the list when it comes to U.S. consumption of seafood, with shrimp often standing headand-shoulders above any other species. The National Oceanic and Atmospheric Administration’s latest U.S. fisheries report found that in 2016, U.S. residents ate an estimated 4.1 pounds of shrimp, accounting for a significant chunk of the 14.9 pounds of seafood the average American consumed that year.

There is, of course, a whole ocean of different species out there, many of which can be sustainably caught and harvested. Moreover, continuing advancements in aquaculture are rapidly allowing different species to be eaten fresh on U.S. soil. Naturally, companies are exploring ways to get American consumers to try those species and venture beyond the big three mainstays.

And now might be the best time in decades to do it.

Recent seafood-focused surveys from Technomic, a company 16 | 2018 KEY BUYER INDUSTRY UPDATE

collecting consumer data on various food industries, found that 55 percent of survey respondents in the millennial age bracket (aged 18 to 34) said they sought out seafood entrees with new or unique flavors. Technomic’s survey data also revealed that 56 percent of participants sought out more ethnic seafood dishes, and 62 percent said they wanted more variety in what restaurants had to offer.

An entirely new species is one great way for consumers to get a different experience than the norm, something that Seattle, Washington-based Trident Seafoods has been promoting with its new wild-caught Alaska pollock products.

“It’s cod’s delicious cousin,” said John Salle, vice president of marketing for Trident.

While Alaska pollock is commonly used in fried, value-added products, the fish is more than delicious enough to stand on its own, Salle said. Taste, he added, remains a key factor for any new product.

“Number one: It’s got to taste good. That’s still, of all things, got to be at the top of the list,” Salle said.

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Trident has developed several products to help promote wild Alaska pollock’s versatility. For example, the company has created a line of new, deep-skin, value-added pollock products – which include diamond-shaped bites cut from deep skin – as a way to champion the fish in an easy-to-cook package.

“We’re really trying to bring new ideas and innovation every year into wild Alaska pollock,” said Allan Kimball, Trident’s executive vice president of the firm’s global species management group.

“Seen as an entryway into a new food type, “We want to provide creative now planning to create a new meal kits give apprehensive consumers detailed new ways to enjoy this product meal kit featuring wild Pacific recipes and a cache of necessary ingredients rockfish. The product, will hit for foodservice, retail, and all needed to bring such recipes to life.” other channels.” retail shelves in July 2018.

The fish itself, said Salle, has The new rockfish kit, “Wild a mild flavor, and is very easy to Pacific Rockfish with Chipotle & cook. The company has given skin-on Alaska pollock fillets to chefs Lime,” will come with a chef-crafted topper and detailed instructions to showcase what the species can be used for if it’s brought outside so that home cooks can prepare the entrée in minutes. the value-added, fried-or-baked mold it’s typically been placed in “It’s our goal at Fishpeople to make cooking this lesser-known by the industry. fish a breeze so the general seafood-eating public becomes familiar “It’s never been sold with the skin on, and it’s amazing the flavor with it and adds value to a species of fish that is caught the right way and versatility it has with the skin on,” Salle said. “It’s kind of, ‘why and tastes delicious,” said Kipp Baratoff, co-founder of Fishpeople. hasn’t anyone ever tried this?’”

He added that rockfish is an ideal candidate for promotion; recent The mild flavor also makes it a prime candidate for another restructuring of the management of the fishery has resulted in up-and-coming product segment: Meal kits. increased availability of rockfish while limiting bycatch, creating more environmentally-friendly sources.

Meal kit mania “Fishpeople’s main mission is to make sustainable seafood Meal kits have skyrocketed in popularity, with multiple U.S. simple by giving people everything they need to make delicious retailers – including Albertson’s, Publix, and Hannaford – starting to seafood entrees and meals without the stress and mess that is usually create their own kit offerings to promote different food categories, associated with preparing fish,” added Fishpeople’s Katie Rubino. including seafood.

Taste, of course, is still an important part of the equation, which is another reason rockfish was selected for the new product.

Seen as an entryway into a new food type, meal kits give apprehensive consumers detailed recipes and a cache of necessary “Rockfish is a true premium whitefish that has a little more ingredients needed to bring such recipes to life. Sustainable meal-kit mystique to it than any of the other ‘trash fish’ with its flakiness and distinctive flavor that pairs incredibly well with the zing of lime and provider Trashfish has used this format to its advantage.

The California-based company’s mission is to highlight what it calls the smoke of chipotle,” said Duncan Berry, co-founder of Fishpeople. “under-loved” seafood by sending meal kits starring underutilized species to subscribers’ homes each week.

Premium product primetime “Almost 80 percent of the seafood Americans eat is made up of Promoting and creating premium products is also a way some just three types of fish,” Trashfish owner Ren Ostry said. “At this rate, companies are looking to expand consumer interests. Ideal Fish, we are at risk of depleting fish populations and we demand a major based in Connecticut, is on the verge of harvesting its first crop of global infrastructure to match our cravings. Our mission is to safely Mediterranean sea bass, also known as branzino. expand consumers’ seafood palates and celebrate the full bounty Ideal Fish’s first harvest will mark a historic moment for North of our local harbor.”

America – it will represent the first time in history that branzino can be Trashfish isn’t the only company looking into meal kits highlighting sourced fresh on the continent. The company is using a state-of-the-art, underutilized species, either. Portland, Oregon’s Fishpeople Seafood, 63,000-square-foot facility that contains a recirculating aquaculture system (RAS) to grow the fish from fingerlings to harvestable size. which has mainly made meal kits using wild salmon and cod, is

18 | 2018 KEY BUYER INDUSTRY UPDATE

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Recirculating aquaculture systems are the latest trend in aquaculture, allowing companies to grow fish with minimal waste products and low environmental impact. Ideal Fish has already been rated as a “Best Choice” by Monterey Bay Aquarium’s Seafood Watch program, something that the company is using in its promotions of the forthcoming product.

“We’re not just selling the fish, we’re selling the whole process,” said James MacKnight, director of sales and marketing for Ideal Fish.

“We’re not coming to market with a branzino per say, we’re coming to market with everything associated with that fish.”

Sustainability is increasingly on the mind of consumers as they go to purchase seafood. Ideal Fish keeps that in mind as it strives to create an environmentally-friendly facility with low carbon emissions, according to the company.

Part of the process to get to that point involves an 8,000-squarefoot aquaponics system, which is scheduled to be completed in August 2018. The system will use waste products from the production of the fish as plant-food, allowing the company to grow 75,000 pounds of leafy greens a year.

“At the end of the day, you have a fully self-enclosed contained facility that can harvest and grow top-quality, very clean protein, and use all of the byproducts from growing that protein and grow any leafy green, herby vegetable that you want,” MacKnight said.

Another key aspect of Ideal Fish’s marketing is promoting

its premium, high-end aspects. The product itself will be fresher than anything else on the market in the United States, as currently all branzino sold in North America has to be shipped over from Europe, the company said. Ideal Fish will be able to transport its fish to any market within a large radius of its facility – which includes restaurants in New York City and Boston, Massachusetts – within 24 hours.

“We know people are willing to put out the money to buy this kind of fish,” MacKnight said. He added that the company has already been fielding calls from chefs who use branzino. Heading deeper into 2018, top quality, higher-end seafood outside of main brands is starting to pick up interest, MacKnight noted.

Whether it’s new, value-added products, meal kits, or premium selections, consumers are more interested than ever in where their seafood is coming from, both during the holiday season and beyond.

Underutilized, “under-loved” species coming from local, sustainable sources are increasingly being seen as a great way to appeal to savvy customers who keep an eye on where their fish originates from.

“Without a shadow of a doubt I can stand here and tell you that absolutely more and more people are asking the provenance of the fish,” MacKnight said. “It will call to the stand companies out there to raise their standards, to change some of their processes, because the consumer is getting more concerned about the provenance of the fish.”

Brought to you by SeafoodSource | 19

Q & A

5 questions with Dish On Fish

By Madelyn Kearns

Rima Kleiner

“We start by thinking about how Americans eat during those months.

December tends to be entertaining, comfort foods, and quick-and-easy dishes, like ‘Cod & Corn Chowder;’ while January is traditionally about lighter, healthier eating.”

Judy Dashiell

CONSUMER EDUCATION IS AT THE (healthy) heart of the National Fisheries Institute’s Dish on Fish blog, which offers inspiration, education, tips, and how-to articles geared toward American consumers in an effort to encourage them to eat seafood at least twice a week, as is recommended in the latest USDA Dietary Guidelines.

Garnering an estimated 10,000 visits and 130,000 likes on Facebook each month, Dish on Fish’s message and mission is resonating with its audience, and its crafters and contributors are enthusiastic about what the future holds. SeafoodSource sat down with Judy Dashiell, senior vice president for the National Fisheries Institute, as well as licensed dietitian and nutritionist Rima Kleiner, who’s perspective fuels many of Dish on Fish’s features, to get the scoop on the blog and how it’ll be used to entice consumers to seafood once the holiday season arrives.

SeafoodSource: What is the main mission driving Dish on Fish?

Dashiell: Dish on Fish is a tactic of NFI’s Strategic Planning Goal to Educate Consumers. Via Dish on Fish, NFI can

20 | 2018 KEY BUYER INDUSTRY UPDATE

communicate directly with U.S. consumers, food bloggers, and health professionals, such as R.D.s [registered dieticians], about the importance of eating seafood at least twice a week, as recommended by the USDA Dietary Guidelines for Americans. Through our blog and social channels, we hope to inspire consumers to choose seafood more frequently, both at home and when dining out.

SeafoodSource: What considerations go into developing a Dish on Fish “Meal Plan” during the holiday season (December and January)?

Dashiell: We start by thinking about how Americans eat during those months.

December tends to be entertaining, comfort foods, and quick-and-easy dishes, like “Cod & Corn Chowder;” while January is traditionally about lighter, healthier eating. So we work within those guidelines and then layer the current trends and flavor profiles.

SeafoodSource: Do you find that for the holidays, consumers are looking for seafood recipes with an appetizer focus? How imperative Summer Edition

do you think the entertainment factor is for consumers cooking seafood during the holidays?

Dashiell: Since appetizers and entertaining go hand-in-hand, we tend to see more demand and higher search frequency for appetizer recipes across our channels during the holiday season.

Because seafood is so versatile, consumers see it as an excellent option for entertaining, and they know it is something their guests will love. Interestingly, many of the tailgate recipes we feature in the fall lend themselves to appetizers, so we feature apps from September to December.

SeafoodSource: What role does nutrition play in Dish on Fish’s Meal Plan development? Does this aspect of wellness contribute to recipe suggestions for the New Year (January’s Meal Plan), when many resolutions are being made?

Kleiner: The Dietary Guidelines for Americans’ recommendation to eat at least two seafood meals a week is a constant theme of the Dish on Fish blog. Consumers want to be knowledgeable about the nutrition behind seafood and we provide that regularly. Across our channels, we aim to feature seafood dishes that are not only delicious and easy to make, but also good for you. In January, we tailor the meal plan to those seeking ideas and inspiration to help them stick to their New Year’s resolutions and healthier diets. Throughout the first month of the year, we highlight betterfor-you dishes and offer tips, tricks and different options for lightening up various recipes. We also want to remind our readers that nutritious food should taste good and that there is room for the occasional indulgent meal.

Cod and Corn Chowder (Servings: 4-6) Take a turkey break and whip up this easy cod and corn chowder for a satisfying—and healthy—lunch or dinner. The satisfying flavor of cod mixed with corn, red pepper, onion and potatoes is like no other. Plus, it’s ready in 15 minutes. Take your leftovers to work the next day for a lunch that reheats into another tasty seafood meal!

INGREDIENTS: • 1½ tablespoons unsalted butter • ½ medium-sized yellow onion, chopped

SeafoodSource: How does social media factor into Dish on Fish’s mission? Does the site employ any seasonal themes or hashtags during the latter months of the year/into the New Year that consumers engage with?

Dashiell: Social media is a core piece of Dish on Fish’s strategy and an important element of carrying out the overall mission of the initiative. We primarily use Facebook and Twitter to promote our blog content, and Pinterest to share popular and trending seafood recipes.

We also recently launched an Instagram handle designed to inspire seafood consumption at eateries across the United States.

On every platform, when it’s relevant, we utilize trending or seasonal hashtags to improve searchability and shelf-life of our content.

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• 2 scallions, thinly sliced, white and green parts separated • 4 cups low-sodium chicken broth or vegetable broth • 2 cups potatoes, washed well and diced (keep peel on) • 1½ pounds cod, cut into 1-inch pieces • 2 cups frozen sweet corn, thawed • ½ cup half-and-half • ½ cup skim milk • Dash of turmeric • ¼ teaspoon red pepper flakes • Salt and ground black pepper, to taste DIRECTIONS: 1. In a large Dutch oven or pot, melt butter over medium-high heat.

2. Add onions and scallion whites. Sauté until softened, about 2 minutes.

3. Add broth, potatoes and cod. Cover and bring to a boil. Reduce heat and simmer until potatoes are tender, about 8 to 10 minutes.

4. Add corn, half-and-half, skim milk, red pepper flakes and turmeric. Cover and bring to a light simmer.

5. Add salt and pepper, as desired. Garnish with scallion greens.

Recipe courtesy of Dish on Fish Photo styling: Monica Lavin of Lavin Label Photography: Kelli Boyd Photography

Brought to you by SeafoodSource | 21

TRENDS

Small portions, big opportunities

“It’s easier for consumers to be more adventurous when the portion is smaller, because that means the commitment is smaller.”

Consumers favoring smaller bites, to seafood’s benefit

By Madelyn Kearns

MANY GREAT THINGS START OUT SMALL. That’s really promising news for the seafood industry, if the latest consumer trends hold true. According to Polly Legendre, a wellrespected food trends expert and founder of Polished Brands, seafood’s next great venture will involve starting out small, and staying that way. “People are eating more often, but in less quantities – it’s a really good opportunity for seafood,” she said.

The place for seafood no longer needs to be at the center of the plate, Legendre argued, especially not when consumers are shifting their eating habits to accommodate smaller portions more often during the day.

“With seafood, there’s such a wide variety of species and preparations – hot, cold, smoked, everything is out there – and having smaller commitment sizes at more opportunities throughout the day” is advantageous for seafood, as it “allows 22 | 2018 KEY BUYER INDUSTRY UPDATE

people to experiment with their products,” she said.

“With the consumer trend going smaller and more often, seafood’s opportunity is to address all those other meal points of the day, from brunches, to sandwiches, to salads, etcetera. There’s so many opportunities for seafood because seafood has that variety,” Legendre added.

Smaller portions also encourage consumers to experiment with bolder flavor profiles, a fact that many foodservice professionals in particular are trying to capitalize on with their appetizer offerings, according to Illinois-based distributor US Foods.

“Smaller portions mean that strongly flavored or premium ingredients can star.

It’s no surprise that trends pop up fastest on the starters’ list. Appetizers are gaining prominence as consumers’ notions about

dining occasions evolve. Starters are a perfect fit with today’s most important lifestyle trends: downsizing of portions and prices; sharing and sampling; on-the-go eating; and around-the-clock grazing,” US Foods wrote on its website in relation to noteworthy trends unfolding in the appetizer sector.

Bolder, braver bites Panelists at the 2018 Global Seafood Market Conference (GSMC), hosted by the National Fisheries Institute back in January of this year, were on the same page. Going out to eat for younger consumer groups these days is all about bold flavors, experience, adventure, and togetherness. Such preferences seem to be the pillars elevating the small-plate craze currently dominating foodservice.

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TRENDS

millennials, who yearn for social dining experiences that go beyond just eating alongside friends, the GSMC panel said.

Much about these consumers defies the trends of the past – they tend to eat four smaller meals a day at non-traditional times, with 55 percent preferring communal tables at restaurants, according to data from Splendid Communications. Millennials even love to grocery shop in groups, and view food as a vehicle for entertainment and selfexpression, the brand research firm found.

Orca Bay Foods’ Marketing and Communications Manager Lilani Estacio confirmed that, for millennials in particular, eating has indeed become a means for connection and adventure. “[Millennials] are really all about the experience, and that’s why the shared plate is booming in the restaurant industry. It’s a social experience for them, and they are active social media users as well,” Estacio said.

With “people now exploring and traveling more than any other time,” according to Legendre, it’s easier for consumers to try something new. And the likelihood of diners braving new cuisines only intensifies when serving sizes shrink, she said.

“It’s easier for consumers to be more adventurous when the portion is smaller, because that means the commitment is smaller,” Legendre said.

Shared and small plates also cater to consumers’ desires to try new foods together, noted the GSMC panel. Such offerings work to appease young consumers’ hunger for healthy meals that pack an appealing aesthetic as well. Additional factors that make small plates most attractive, according to the GSMC panel, include: • smaller-sized plates reduce the amount of food diners leave uneaten, on average 17 percent of their meals; • consumers find a 70-percent plate fill rate to be “visually pleasing;” and • consumers report the same level of satisfaction for a small-plated portion than a large as long as the plate appears full.

The fact that small plates present less risk financially has also proven to be a draw for millennial consumers and others, Estacio added. “Shared plates and small plates are a fun experience for [millennials] – it’s low risk, they’re trying different things without fully investing what you would be paying for a 24 | 2018 KEY BUYER INDUSTRY UPDATE

“You already know the Italian antipasti, the Spanish tapas, and the French hors d’oeuvre.

We give the small dish that evokes your appetite with an Icelandic twist.”

main entrée,” she said.

Seafood dishes that are seeing traction within the small plate arena include tuna poke, as well as appetizer dishes that take parts of fish and transform them into recognizable pub fare, such as tuna wings or catfish nuggets.

The starters line Different players in retail are also trying their hand at smaller portion offerings and seafood appetizer products. For example, Reykjavic, Iceland-based seafood company Iceland’s Finest took home top honors at the 2018 Seafood Excellence Awards – held during Seafood Expo North America in Boston, Massachusetts in March – for its Icelandic Seafood Starters kits, a takehome appetizer product line. The whole aim of Icelandic Seafood Starters is to attract millennials and small-plate enthusiasts to seafood, according to Iceland’s Finest Export Manager, Jóhannes Egilsson.

“What we would really like to do is help the younger generation, the millennials, to consume seafood,” Egilsson said.

Icelandic Seafood Starters come in an array of flavors including Lemony Cod Liver Pate Bites, Crunchy Caviar Bites, Rich Langoustine Soup, Creamy Caviar Herring Bites, and the award-winning Creamy Masago Bites. Each of the five kits currently available in the line was designed to help consumers overcome some of their seafood trepidations.

The starters also feature a social component and appeal that helps to set the products apart in the market, Egilsson explained.

“We want to make seafood simple and social,” Egilsson said. “We offer culinary education and help people to prepare and enjoy healthy, stylish food… to be shared in good company.”

Through the product line, Iceland’s Finest is also looking to establish a foothold in the appetizer realm for authentic Icelandic cuisine.

“You already know the Italian antipasti, the Spanish tapas, and the French hors d’oeuvre. We give the small dish that evokes your appetite with an Icelandic twist,” the company wrote of the Icelandic Seafood Starters product line.

Summer Edition

PROFILE

Unwrapping retail’s “elegant” seafood season Phil Walsh is a bit of a Renaissance man.

By Madelyn Kearns

HIS CAREER IN THE SEAFOOD INDUSTRY is hallmarked with leadership titles. He’s served as director of seafood for three major U.S. supermarket chains: Kings Supermarkets, Harris Teeter Supermarkets, and Stop & Shop Supermarkets, where he played a pivotal role in creating the nation’s first sustainability program, in conjunction with The New England Aquarium. He has also held executive positions with Metro New York Sysco, Porky Products, Hilo Fish, and Kiawah-Seabrook Seafood.

Currently, Walsh is the vice president of sales for St. Andrews USA – the American marketing arm for the world’s largest producer of farm-raised mussels, St. Andrews, LLC – and the professor of an graduate course in seafood marketing at the University of Miami’s Rosenstiel School of Marine and Atmospheric Science.

As if that weren’t enough to keep him busy, Walsh also makes regular contributions to The Advocate, an aquaculture trade magazine; he serves as a featured speaker for several seafood trade events; he’s the author of the seafood industry-set novel, “Isle Of Shoals;” and he’s a family man, with four children and six grandchildren.

Phil Walsh has done it all, and then some.

SeafoodSource called Walsh to get a sense of some of the major themes presently at play in the retail sector, during an era of tremendous opportunity for the seafood industry at large.

Play on words Americans have some hang-ups when it comes to seafood, Walsh told me during our interview. Some of these hang-ups have a tendency to play off of each other, particularly during the holiday months.

“Americans are really stuck on the word ‘fresh,’” Walsh said.

One way to accommodate this comes in the form of aquaculture, but Americans are sort of hung-up on that word and 26 | 2018 KEY BUYER INDUSTRY UPDATE

concept, too, he added. However, there’s an opportunity for retailers to appeal to Americans’ desire for freshness during the holidays with farmed species like salmon, which is consistently in high demand throughout the season and beyond. “[Consumers] like fresh. And the fresh salmon they can get during the holidays is farmed salmon,” Walsh said.

‘Elegance’ is another word that comes to mind for U.S. consumers shopping for seafood, both farmed and wild-caught, during the winter season. As such, there are specific species that do especially well from December into early February, when the Super Bowl – now the third-largest eating holiday of the year – occurs, according to Walsh.

“Shrimp is huge, because it’s elegant,” he said, noting that “fish choice tends to be on elegant side as well,” with species such as “salmon, halibut, black cod, and so forth” ranking high on Americans’ grocery lists during the colder months.

“The retail season for seafood really starts with Christmas” in the United States, Walsh said, and it doesn’t usually let up until after Labor Day, when retailers will be left “just trying to survive for the next three months, mostly because people are tapped out financially from the summer.”

To get a deeper read into seafood consumption health in the United States throughout the year, Walsh suggested keeping an eye not only on the calendar, but on recession indicators as well. “When the construction of swimming pools drops, seafood sales drop. Those are a few good indicators that disposable income is not there anymore,” he said.

Producing better seafood departments Ultimately, what tends to drive Americans to eat seafood is the quality, Walsh explained.

If the quality is there, consumption tends to follow. “You just have to put really, really good fish into the system, and then everything works,” Walsh said.

In this sense, there’s another tactic that retailers can employ to potentially generate more success at their fresh seafood counters – limiting the varieties of seafood available.

Repeat positive experiences with seafood will bring consumers back for more, and a great way to secure these experiences is through quality assurance, Walsh said, which can be easier to gauge when retailers focus on providing around “six or seven varieties” housed in “case-ready packaging with barcodes.” This format tends to yield better shelf life, and allows consumers to get a sense of where their seafood is coming from, he said. Retailers don’t need full-service fish counters to run a successful seafood department anymore, Walsh added.

Condensing seafood varieties and experimenting with case presentation methods/packaging aren’t the only adjustments retailers can try to boost sales in their seafood segments, according to Walsh.

Maneuvering the way seafood departments are managed, and by whom, could also be fruitful.

“One thing that would be, to me, a fine thing to happen, would be if the management structure above seafood changed so that the seafood director is reporting to the vice president of produce,” Walsh said. “Now, they report to the vice president of meat, and meat is so different from seafood – meat is all about tonnage.”

Both fish and produce, meanwhile, operate more on peer-to-peer relationships and partnerships, and aren’t as volume- and price-oriented in the same way that the meat department is. “You don’t buy the cheapest fish – you can’t,” Walsh said. “To run a good seafood program you need a light hand on the tiller…And that’s how it is with produce.”

Summer Edition