Sector Trend Analysis – Fish and seafood trends in the United Kingdom

Canadian performance

Canada was the eleventh-largest overall supplier of fish and seafood to the United Kingdom (UK), with sales of US$141.3 million in 2017. Canada is also the sixth non-European Union (non-EU) supplier to the UK. This represents a decrease of total imports of approximately 40% from 2015. In turn, the top five commodities listed below resulted in a decrease of imports, at the exception of live/fresh/chilled lobsters and frozen fillets of cod which have experienced a slight growth over the last three years.

While Canadian fish and seafood is perceived favourably, the total volume of imports is falling within the United Kingdom due to the high prices it commands, relative to the competitors. Local competition from northern European suppliers continue to affect Canadian supply, but the implementation of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA), is expected to help fill key EU opportunities including frozen and packaged food. Most of the tariffs will be eliminated gradually within three, five, or seven years. See the chapter-by-chapter guide to the key provisions of the Agreement. The fish and seafood industry has been a key export for Canada to the UK.

Another key factor which seems to have had negative ramifications on the fish and seafood sector's import prices and tight supplies within the UK, has been due to the result of the "British exit" (Brexit) referendum. The decision made by the UK on June 23, 2016 to leave the EU led to a 20% devaluation of the Great Britain Pound (£GBP), thereby affecting the exchange rate and making imports more expensive. In addition, Canada's department of fisheries and oceans (DFO) announcement to introduce a quota for the 2017/18 fishing season of coldwater shrimp, one of the country's key exports to the UK, has also impacted the industry. The introduction of this total allowable catch (TAC) quota for northern shrimp fishing, is said to result in a dramatic fall in biomass by 25%, cutting the quota in area six by 62% year-on-year, to 10,400 metric tons. For more information read DFO Announces.

The United Kingdom was Canada's twenty-second most important market for fish and seafood, whereby in 2017 Canada imported approximately 0.5% of their fish and seafood imports from the UK. Canadian import suppliers are quite diversified, with fish and seafood products imported from 147 different countries. Canada's top suppliers in 2017 were the United States (33.7%), China (14.3%), Thailand (8.9%), Vietnam (7.1%), and India (5.0%). (Global Trade Tracker, 2017).

By the numbers

Market sizes

The United Kingdom is a major market for fish and seafood products. Fish and seafood in the United Kingdom is expected to post a 1% total volume compound annual growth rate (CAGR) over the forecasted period. Health trends are hoped to boost the demand in fish and seafood sales by prioritising on healthier proteins and moving away from consuming fatty meats.

The market share for all fresh seafood categories were still slowly on the rise throughout the five year historic growth rate, including crustaceans, fish and seafood, molluscs and cephalopods, along with chilled packaged seafood. However, during the period of 2018 to 2022, only fresh fish and seafood are forecasted to continue to increase positively at a CAGR of 1.2%. The packaged shelf stable seafood is forecasted over a period of five years to continue to decline the most by a negative CAGR of 2.0%. Finally, although the demand for packaged frozen processed seafood will remain within a negative CAGR, the growth rate will still improve from a historical rate of a negative CAGR of 2.7% to a negative CAGR of only 0.2% and will be considered a stable alternative option for consumption.

Consumption trends

British consumers are more informed about what they consume and eating well is important to them. Promoting fish as a quick, easy and healthy balanced meal is an essential trend focusing on fish species such as salmon and mackerel which are rich in omega-3 fatty acids and vitamin D, essential features of cognitive and cardio health. 'Health' and 'taste' are the key components of 'quality' in the mind of the shopper, both of which shoppers strongly associate with seafood. Yet when the economy is struggling, in the case of the post Brexit referendum, shoppers and consumers trade out seafood to turn to cheaper proteins. Before the vote, unprocessed naturally healthy food was high on the shoppers' list, prioritising quality at 22% over saving money at 19%. Post the vote, the shopper priorities within the United Kingdom shifted by focusing back on saving money rather than quality. It is too early to predict how the result of the referendum has impacted the UK economy and shopper preferences in the long term, but history has shown that seafood consumption is directly linked to the UK economy. To read more see the Seafish report (PDF).

Euromonitor International reports that the British consumed a combined total of 11.5 kilograms (kg) of fish and seafood per capita in 2017. This represents a decline of approximately 0.9% from 2016 and it is forecasted that it will continue to decline by that percentage in 2018. However, in 2019 it is forecasted that the total consumption of fish and seafood per capita will then rise about 1.8% and remain stable at this amount for the next upcoming years. This increase will result mainly by an increase in the fresh fish and seafood categories. The consumption of frozen processed and packaged seafood is forecasted to remain as a stable and viable option with a total average volume CAGR of 140 tonnes from 2018 to 2022, while packaged shelf stable seafood will continue to decrease by a CAGR of −2.0% during the same timeframe.

Fish manufacturers can look for specific solutions to drive value sales of different fish and seafood types through innovation in packaged fish and seafood options. Consumers buy more frequently and are becoming slightly more loyal to frozen fish products. British consumers more often order fish and seafood meals prepared within restaurants or through other food service channels, as much as 35% or one third of the time. However, British consumers are slowly overcoming their fear of cooking fish and seafood with available step-by-step preparation guides and promotions which profile fish and seafood as both healthy and convenient. Additionally, with conveniently packaged alternatives and clever labels supporting the healthy home-cooked family meal option, a rise in packaged fish sales will see consumers develop a greater propensity to eat fish in general. This is important to boost the historically consistent decline in overall consumption of fish and seafood, within the United Kingdom.

Opportunities

The United Kingdom is one of the most digitally advanced markets in the world, where the most digitally savvy category in the United Kingdom by far is in retailing. Within retail, connected commerce provides the greatest opportunity particularly with grocery shopping. British consumers are interested in finding the newest, fastest and the most convenient methods of payment via mobile smartphones and contactless technology. Mobile orders with well-developed apps are the fastest growing m-commerce and are the top consumer trend sales channel with the highest growing future potential. Consumer foodservice via remote mobile purchases has seen a growth of 44% in 2017, to reach total value sales of 3.9 billion in US dollars. Digital consumer purchases have also increased significantly by 10% in terms of value sales in 2017 and are considered the most utilized purchasing method rather than an exception. This trend helps the consumers save money and make repeat purchases, while finding the most convenient, most efficient way possible to top up their shopping baskets (Euromonitor International, 2017).

The United Kingdom market is very important for Newfoundland and Labrador seafood, particularly for coldwater shrimp and cod, as indicated in the "By the numbers" section within this report as being amongst the top imported products of fish and seafood to the UK within 2017. One example of a major marketing initiative in the UK that was developed from the International Cold Water Prawn Forum and is a collaborative initiative from the Royal Greenland and the Association of Seafood Producers within Newfoundland, includes the Wild Atlantic Prawns interactive Chef Education programme. More recently the founding members have been joined by the Norwegian Seafood Council, Icelandic Export Centre Ltd and Holmadrangur ehf. It is designed to provide chefs, trainee chefs and those studying hospitality management subjects an introduction to Wild Atlantic Prawns. Additionally more recently, an Atlantic Canada event was held at the seafood school at Billingsgate, which promoted Canadian seafood to chefs, food writers, bloggers and food journalists.

Government appointed experts within the fish and seafood industry have formed a working group to aim at doubling fish and seafood consumption by 2040. All officials involved in the 2040 project have recognised that the seafood value chain is on the brink of enormous opportunity and are trying to quantify and know how to measure, just how big this opportunity could be. In essence, they are asking questions like is it possible to achieve Public Health England's advice for each of us to eat at least two portions of seafood a week and whether we can sustain such a demand if possible or what would be the positive impacts on our health and how can the supply chain evolve to meet this possible growing demand? Their vision is to describe what a thriving industry might look like while fuelling the economic growth within the sector, by doubling the consumption of fish and seafood per person, per week and in return be able to measure the substantial health gains and associated cost savings for the UK, accordingly. To read more see the Seafood 2040 report: A strategic framework for England (PDF).

Distribution channels

Although historically being the most popular means of consuming fish and seafood in the United Kingdom, eating out via high end restaurants or other foodservices is expected to decline into 2022; along with the demand of fish and seafood prepared within institutions. As the chart indicates below, digital retail purchases of fish and seafood are expected to experience the highest year over year (*YOY) point growth trend at 62% in 2017.

As described in a Seafish report (PDF), once again, the economy within the UK has demonstrated strong negative ramifications due to the Brexit referendum. In 2015, as the UK slowly continued to move out of austerity, total foodservice led the recovery with return in total-servings growth in the third quarter (Q3) of 2015. Seafood continued to grow in foodservice into the first half of 2016 (pre Brexit referendum), indicative of the growing economy and high shopper confidence. Fish and chips also performed strongly across nearly all channels, which had been in gradual decline as a meal since 2010. Then after the referendum result, UK consumer confidence as measured by the European Commission, plummeted 8 points. It has since begun to recover, but is still a long way behind pre referendum levels.

Product launch analysis

According to Mintel International 2018, there were 52 new processed fish products launched in the United Kingdom market between March 2017 and March 2018. As shown in the table below, branded options represented about 46% of the total launches, chilled options (versus shelf-stable or frozen) were the preferred storage type, and ethical-oriented environmentally friendly and ease of use product claims featured very prominently among the new releases.

Examples of new products

According to Mintel International 2018, the following are some examples of the new products launched in the United Kingdom market from March 2017 to March 2018, including the top 3 ethical- environmentally friendly and easy to use claims.

Beer Battered Cod Fillets

Company	Tesco
Brand	Tesco Finest
Label	Private label
Import Status	Not imported
Price in US dollars	6.21
Launch Type	New packaging
Date published	March 2018
Packaging	Tray, Plastic PET
Storage Type	Chilled

Product Description: Tesco Finest Beer Battered Cod Fillets have been repackaged with a newly designed 385 gram (g) recyclable pack, containing two units and featuring the Marine Stewardship Counci (MSC) certified sustainable seafood, and the Black Sheep brewery logos. The skinless and freezable fillets comprise of a crisp coated batter made with Black Sheep Ale beer, which was said to be selected for its distinctively smooth and bittersweet taste.

Seafood Selection

Company	Asda
Label	Private label
Price in US dollars	6.35
Launch Type	New variety/range extension
Date published	February 2018
Packaging	Flexible stand-up pouch
Storage Type	Frozen

Product Description: Asda Seafood Selection comprises a mix of cooked succulent mussel meat, cooked squid rings and cooked and peeled prawns in a protective ice glaze. The sustainably sourced product has been freshly frozen for locked-in freshness, is ready cooked and can simply be defrosted and eaten or heated and added to a dish.

Sugo Benessere Leggerezza Seafood Medley

Company	Iceland Foods
Brand	Iceland
Label	Private label
Price in US dollars	4.85
Launch Type	New variety/range extension
Date published	January 2018
Packaging	Tray, carton, vacuum sealed plastic
Storage Type	Frozen

Product Description: Comprised of squid, clams, shrimp, cherry tomatoes and courgettes in a turmeric and saffron sauce. The product is low in saturated fat, can be heated and served with pasta, and contains 57 calories per half a pack. It also can be stir-fried in seven minutes.

For more information

International Trade Commissioners can provide Canadian industry with on-the-ground expertise regarding market potential, current conditions and local business contacts, and are an excellent point of contact for export advice.

• Overview of Trade Commissioner Services in the United Kingdom
• Find a Trade Commissioner

For additional intelligence on this and other markets, the complete library of Global Analysis reports can be found on the International agri-food market intelligence page, arranged by region.

For additional information on the Seafood Expo Global (SEG) 2018, please contact:

Ben Berry, Deputy Director
Trade Show Strategy and Delivery
Agriculture and Agri-Food Canada
ben.berry@canada.ca

Resources

• Euromonitor International, March 2018. Fish and Seafood in the United Kingdom- Analysis and Datagraphics: Country Report
• Euromonitor International, 11 April 2018. Digital Consumer in the United Kingdom: Country Report.
• International Trade and Investment Agreements (Global Affairs Canada), 2018. European Union- Chapter Summaries.
• Mintel International Global New Products Database, March 2017-2018.
• Richard Watson, October 2016. Seafood Information Fact Sheet: Seafood Consumption (2016 Update).
• Seafood 2040, 7 December 2017. A strategic framework for England.
• Undercurrentnews, 31 March 2017. Ramsden, Neil. Canada's DFO announces 62% cut to area six shrimp quota.

Sector Trend Analysis – Fish and seafood trends in the United Kingdom
Global Analysis Report

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