fish international 2022, 4-6 September, Bremen

“Just perfect” -- Three entirely different storms hit Europe at once

The last time fish international was held—in February 2020—the northwestern German state and city of Bremen had just been hit by hurricane-strength Storm Sabine, causing hundreds of millions of euros worth of damage across the country. Attendees and exhibitors who braved the weather—including seafood industry officials, people in related lines of business, providers of industry services, those with NGOs or government agencies—sipped their coffee and thought “Whew. It can’t get worse than this.” Little did they know.

Back in February 2020, the ink on the “Brexit” deal was drying but the chapter on UK-EU fisheries access— the issue that started the whole thing—was mysteriously missing. A virus called “Covid-19” was known to only a handful of scientists around the world. For many, the word “Ukraine” referred to the only country in this century that has reached the semifinal stage in every Eurovision song contest. Not to forget—as we were almost able to—the price of energy, whose several-fold increase started before the invasion of Ukraine. Back in early 2020, there was little talk in the seafood industry about three emerging problems that would eventually sweep over Europe.

Since then, much has changed. Seafood production and marketing have been hit by waves of turbulence. Yet the seafood industry has survived. Some—supermarkets and companies providing services, for example—have in fact prospered; some—such as small firms operating on low margins even in the best of times—have fallen by the wayside. But as a whole the industry is navigating troubled waters successfully. Even Messe Bremen, the organizer of fish international, delayed this first post-hurricane show by only half a year, to limit remaining Covid-19 risks. With 320 exhibitors from 27 countries, the 2022 edition of the show was even larger than in 2020.

In what ways have the challenges of this perfect storm passing through Europe affected industry members so far? How is a different kind of storm than last time treating businesses, and what are the ways for the industry to stay float?

New Brexit rules, and probably just “a few months” of Covid-19

After years of effort, the UK’s official departure from the EU took place on 31 January 2020. “Unlike in the case of Covid-19, we knew Brexit was happening,” says Gerjan de Hullu, senior planner at Kotra Logistics, a Netherlandsbased company which specialises in fresh and frozen fish and seafood products transportation. With 200 of its own trucks and more contracted for busy periods, and multiple hubs across Europe, Kotra can move products quickly, packing them when necessary, moving them by truck to rail, ships, or planes, and back to trucks for delivery. Its hub system—replacing single-load shipment straight from seller to buyer—is more efficient; a shipment by air from Norway, for example, to a Kotra hub in the EU before it goes to the buyer, ultimately reduces costs. Kotra’s goal is to be an “all service” logistics company, handling everything from loading truck trailers onto freight cars to filling out paperwork for intra-EU trade—its primary customer base.

With such experience in moving seafood from one European country to another, Kotra knows the ins and outs of seafood transportation. What the company didn’t know was how confused a British exporter of Norway lobster can get

M3B GmbH/Oliver Saul

over customs papers that Brexit suddenly requires to be filed for a shipment to France, a route that used to be barrier-free.

Lucky for all involved, Kotra has been filling out customs papers for years. But that’s not true of many (well, until 2020, most) seafood exporters in the UK and EU buyers of UK seafood. So there has been a long adjustment period, which isn’t good for highly perishable fish. A box of fresh Scottish shellfish that is being held up for 24 hours over paperwork at the English Channel has probably met its final destination. To help UK companies manage such trade with the EU, Kotra uses its long customs experience with Switzerland and elsewhere. “They have learned from us, and by helping them, we maintain the business. The goods are still the same, the transport lines are still the same, but you have other responsibilities, other requirements for the transportation.”

The pandemic has brought problems completely different from those of Brexit. A good example comes from Kristian Moeller, CEO of GLOBALG.A.P., with one of that organization’s challenges that it craftily overcame: how to inspect an aquaculture establishment for sustainability certification without violating pandemic quarantine rules? The problem isn’t the paperwork that is required in a certification application or renewal, that can be done electronically (“in fact, it’s easier” than in person). The problem is the physical inspection by auditors. To solve this, Global Gap has put considerable effort into developing a tool through which they can carry out remote audits. They developed regulations on how an auditor needs to perform a fish farm audit remotely via Zoom and other business communication platforms and learn how a business is being run. The innovation created cost savings, including auditor time and travel costs, and actually increased employment as individual consultations have become larger with the new technology. Instead of sending a few people to a location, more people are involved in the remote consultation. A lasting innovation, all because of the pandemic. In addition, since the restaurants were closed, the farmers switched to retail sector, and the demand for fresh fish increased— the requirement for certified fish even grew.

Gerjan de Hullu describes succinctly some of the gainers and losers from the pandemic, after observing changes in the purchasing segment of the seafood industry that the company serves. Their customers include companies that deliver to supermarkets, and their volume was stable or rising. While the HoReCa sector sales were down with closed outlet trade, sales in the supermarket sector were up in volume. “People were saying ‘If I cannot go to the restaurant, I would then buy the fish for myself and cook it in my own kitchen.’“ Mr. de Hullu also noted that the customers became more open-minded, and wanted to try doing something new, even if they had done the same thing for over ten years.

The pandemic caused problems in other areas too, explained Rolandas Mork nas, the director of Lithuanian producer organization, the National Association of Aquaculture and Fish Products Producers. The pandemic closed farmers’ markets and trade points, and consumers had fewer opportunities to buy fish directly from a farm, an important sales channel for the PO’s members. In addition, veterinary restrictions were tightened, and live fish sales banned, which caused producers to turn to primary processing and start offering gutted and cut fish (though not all the producers had processing units). All of this added costs which when possible were passed on in higher prices to consumers who, by EU standards, are not very wealthy and are very careful about the money. However, the new products were accepted by Lithuanian consumers, despite the concerns.

Energy prices and the invasion of Ukraine

Valdur Noormagi, chairman of the Estonian Association of Fisheries, thinks that the pandemic is minor compared to the war in Ukraine, as the country was one of the largest customers for Estonia’s sprats and Baltic herring. Supplies are still happening, but the volumes go down—Ukraine’s declining currency is making imports too expensive for an already financially weak population. “We hoped that the situation would improve after the pandemic,” says Mr. Noormagi, “but it has got even worse.”

The Estonian Association of Fisheries, which represents fishers, farmers, and processors, as well as wholesalers and retailers, sells freshwater fish—pikeperch, perch, and salmon products, as well as Baltic herring and anchovy, much of it canned. The operation of a cannery is energy-intensive, and electricity prices in Estonia have risen by up to 7-fold in the last few years. This pushes up costs for consumers, too, as the inflation rate year-on-year reached 25 in August. With an average salary for an Estonian of 1,800 euros a month, there is little left after housing, electricity, and other utilities. “However,” adds Mr. Noormagi, “Estonian companies are not pessimistic. The reality is that now these are difficult times, but we have to go through them.”

The war has also driven up the costs of diesel and grain-based fish feed, both essential for farmers of freshwater fish like the members the National Association of Aquaculture and Fish Products Producers in Lithuania. Carp, for example, take three years to grow to market size, and the process calls for stable energy and feed costs. Yet prices have spiked. The price of electricity, on which RAS producers are highly dependent, is up 4-5-fold, diesel, on which pond farmers depend, is up by 30-50, and wheat and sunflower for carp feed have doubled. “Fish feed producers pay for their raw material,” Mr. Mork nas says, “they also need money, and they cannot wait until we grow our fish and pay them back.”

Eurofish Business Platform participants happy to be together, face-toface, arm-to-arm

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SHELLFISH FARMING SUSTAINABLE FISHING

Eurofish Business Platform brings companies from Eurofish member countries together

At fish international 2022, Eurofish International Organisation provided a Business Platform to companies from its member countries, where they could exhibit and promote their products and services, communicate with visitors and other exhibitors, arrange product samplings, and hold meetings with potential business partners.

This year, Eurofish was joined by six companies from five countries: Croatia, Estonia, Latvia, Lithuania, and Romania.

Association Pastravul tara Ta from Romania is well underway with the construction of a trout farm, with an initial production capacity of 500 tonnes. Buyers have expressed interest in lake trout and salmon trout—the latter because it is cheaper and less fatty than salmon, and consumer demand is expected to be high. These species are destined for local markets, while another planned farm will produce for export. Describing the potential of the German market, Bogdan Mihalache, sales manager, points out that “German consumers eat a lot of fish, but there are not many farms here. There are also a lot of Romanians living here. So, there is market for us, and we are planning to enter the middle to high price niche.”

Besides potential customers at fish international, Mr Mihalache also found just the machinery he had been looking for—slicers for their new factory. “Our current one is too small, and we must use an external facility to process our fish. But we want to build a bigger factory of our own.” Alrey OÜ is a fishing company from Estonia, which has recently added its own shop to its production site, to market the fillets and hot-smoked bream and pikeperch as well as salmon it sources from a partner. However, it seeks customers internationally, and Germany’s only trade show fish international is an obvious place. “The German market is attractive to us, as the consumers know the fish we catch.” Actually, their product may already be there, because they sell large volumes to Poland and we assume it is further sold to Germany. “Obviously, their logistics are better organised than ours,” says Andrey Ulukhaniyants, the owner, “logistics is our weak side. It is difficult to transport small volumes ourselves.” So they will have to find a transport company that can move smaller volumes internationally.

Latvian SIA Dagi, founded in 1992, started producing preserved fish bites in oil, tomato sauce, and mayonnaise. Later other varieties were added. Thirty years later, it offers preserves, hot and cold smoked fish, baked fish, and fish cakes from salmon, cod, perch in jelly, and for Christmas, hot smoked carp. Products are in MAP and vacuum packaged. They cooperate with the HoReCa sector or with small retail chains, producing for private label and for individual customers. For example, in Riga they work with Stockmann, producing Scandinavian style herring. At fish international, there was significant interest in the Scandinavian-style herring, so it might expand into Germany. The company made many promising contacts at fish international, and “if even a few work with us, we will consider this a success,” says Janis Skalbe, the company’s development manager. “This is our first experience as an exhibitor, and our expectations were fulfilled.” Croatian Riba Dražin came to the show with its best-known product „Pepefish”—sweet-sour, red peppers filled with rolled anchovy fillets, but also with others. The company’s value-added products included marinated anchovy fillets, saddled seabream fillets, salted anchovy fillets, fish pate made of peppers and salted anchovies, and deluxe products such as marinated tuna and octopus. “We are happy to be here,” says Zivko Dražin, the company’s owner, “as our products drew a lot of interest from potential buyers from Austria, Germany, and Switzerland. Moreover, our coexhibitor at the Business Platform, Pastravul tara Ta, is interested in using some of our products to diversify their own product range.”

G. Kanaševi ius I “DES ” from Lithuania was founded in 1994, is the country’s number one producer of processed herring. The range includes herring bites and fillets—salted, marinated, and fried, as well as fried cod in different marinades. Over 70 of the volumes are sold domestically, and the rest are exported. “The German market is interesting for us,” says Lina Pilkiene, sales manager, “as there are a lot of potential customers of Central and Eastern European ancestry, and the products we offer are traditional to them. Our herring products attracted a lot of attention during the show.”

Deltaica Seafood from Romania came to fish international for two important reasons: because it is trying to internationalise; and because it seeks new machines to increase its employees’ productivity. The major raw material is carp, which is well-known on the German market. The company’s expansion abroad is easier when it focuses on markets that know the raw material. They are also increasing their product line, adding smoked sturgeon products which the German market is also familiar with, and are planning some species which are known to the Romanian market, but not widely known in Germany yet—pike, Danube shad, and rapa whelk. Teodora Buhai, the marketing manager, adds “Deltaica also came to the trade show looking for suppliers of raw material, especially for pike roe, as one of our signature products is pike roe salad. In addition to finding the machinery for our productivity-boosting needs, at the Business Platform we met a fellow participant who can supply pike roe—right next to us!”

The show goes on!

Despite the world’s problems, exhibitors and attendees at fish international 2022 had nothing but praise for the event. The slightly less-than-expected visitor turnout, caused by the postponement of the show, was viewed positively because only serious people were there. “Quality is better than quantity,” as one exhibitor expressed it, describing how time was more usefully spent with current (and potential future) business partners than with “window shoppers” .

“The phone or Zoom can’t replace face-to-face contact,” another exhibitor stated. Customers, suppliers, even just old friends stop by to renew relationships made stale by pandemic isolation. A firsttime exhibitor, part of his country’s national pavilion, described how his initial uncertainty gave way to confidence in trade show participation. Even if a deal isn’t made on the spot, one feels good about the chances the deal will be made, he said. Seeing you in real life at a trade show is better than a phone call!

Aleksandra Petersen, Eurofish, aleksandra.petersen@eurofish.dk