June, 2006 Edition

                                          What's Happening at the FCC

FCC Spring Board of Directors

Trade Negotiations – Japan

With the uncertainty of the WTO, Doha Round, trade negotiations, International Trade Minister Emerson requested comments on the merits of pursuing liberalized trade and investment negotiations with Japan.

While noting that Japan has liberalized its fish and seafood import regime over the years, the Fisheries Council of Canada pointed out that Japan still maintains high tariffs on some key Canadian exports (salted herring roe and herring roe on tangles from British Columbia, scallops, sea urchins) and some potential opportunities (herring fillets, salted & smoked products) as well as quantitative import quotas that from time to time prove troublesome for some of our exports (scallops).

In summary, the FCC reported that Japan is a good market for our industry. However, significant progress could be achieved with further import liberalization in certain product areas. Our industry is experiencing substantial cost/price pressures resulting from increased fuel costs, a strong currency, and consolidation in the buyer segment. Tariffs of 7%-15% in the Japanese schedule exasperate these pressures and in some instances render marketing initiatives futile.

Lobsters – Market/Product Development

Agriculture & Agri-Food Canada (AAFC) has a Value-Added Seafood Roundtable comprised of industry representatives and federal and provincial government officials. The FCC is a member of the Roundtable. One project the Roundtable recently completed is a Canada-US lobster benchmarking study.

Patrick McGuinness has been asked by AAFC to chair a working group to determine what, if any, follow up initiatives should be undertaken in response to the report. The lobster working group had a conference call recently. The group felt (i) the group should explore whether there was something that could done in the area of market/product development – noting the low-profit margin for processed products identified in the report; and (ii) the group needs additional industry representatives from PEI, New Brunswick, & Nova Scotia.

International Coalition of Fisheries Associations (ICFA)

ICFA had a policy session in New York in May. Work was initiated in order to develop policy proposals for review at the ICFA annual meeting in November. Policy areas to be reviewed are (i) Bio-prospecting/Fishing Activity; (ii) Regional Fisheries Management Organizations (RFMOs)/Multi-purpose MPAs; and (iii) Fishing entities (i.e. Taiwan) and RFMOs.

ICFA took advantage of the location to meet with officials from country Missions to the United Nations to discuss a number of fisheries issues being considered by the UN: (i) sensitive areas/bottom trawling; (ii) marine protected areas as fisheries management tools; and (ii) tuna long lining/sea turtle & sea bird by-catch.

The Missions stressed the need for them to have information from ICFA regarding the responsible fishing activities of the industry and ICFA’s responses and positions on the various issues being promoted by environmental NGOs. As well, they encouraged ICFA to have a targeted communications campaign with the Permanent Missions to the UN, seizing opportunities where ICFA and the Permanent Missions can meet conveniently in an informal and congenial atmosphere

Key Meetings – June

Fishing Impacts/Sensitive Areas – Montreal

DFO/Industry meeting regarding the development of a national policy concerning the impact of fishing on sensitive areas (corals, seamounts, etc.)

Magnuson- Stevens Fisheries Act (MSA) – Washington

A meeting of the FCC, Pacific Seafood Processors Association, the Japan Fisheries Association, the National Fisheries Institute (USA), the Canadian and Japanese Embassies to co-ordinate strategies to rebuff a possible attempt to place restrictions on the operations of Canadian & Japanese fish processing plants in Alaska in the reauthorized MSA.

NAFO – Halifax

Federal/provincial/industry consultation meeting to develop positions/strategies/etc. for the September NAFO meeting.

Market Reports

Seafood is Gaining in US Restaurants

In both 2003 and 2004, seafood consumption reached record levels. The average American now eats 16.6 pounds of fish and shellfish annually. Since 2001, per capital consumption has risen 12 percent or 650 million pounds, and almost everyone believes it will go higher. This trend has been rising hand-in-hand with consumer spending on away-from-home seafood. In 2001, U.S. consumers spent $38.2 billion on seafood in restaurants. According to U.S. government statistics, only three years later, spending had topped $42.8 billion.

Since 1970, per capita seafood consumption has climbed 40 percent, most of that gain coming in the last several years. Poultry consumption is up 133 percent to 72 pounds per person, while beef consumption fell 17 percent over that time.

Technomic, a Chicago-based restaurant research and consulting firm, track the menus of the nation’s top 250 chains by sales, 150 emerging chains and the top 100 independent restaurants, looking for trends and other business intelligence. Of the 250 chains represented, 77 percent of them offered seafood on their menus, while 99 percent of the independents included seafood on their menus. This research revealed that seafood additions to menus are increasing at a faster rate than any other protein.

Technomics compared the first half of 2005 with the second half of the year, and found that seafood additions on restaurant menus increased 7 percent. Chicken increased 5 percent and beef increased 4 percent. The increase in seafood items suggests fish and shellfish dishes are taking new spots, and leaving less available for other proteins such as chicken and beef.

Menu Favourites at U.S. Restaurants