© Luonnonvarakeskus © Luonnonvarakeskus

Jari Setälä, Kaija Saarni and Jari Niukko

Natural Resources Institute Finland (Luke)

2018

Fish Market Review 2017

Funding

2

This Fish Market Review was partly funded

with assistance from the European Maritime and Fisheries Fund (EMFF).

The review provides information for evaluating and anticipating

the EMFF Operational Programme for Finland.

3

Contents

The global market (pp. 4–12) Fish consumption increases

Aquaculture is among the fastest growing food production sectors

Fishing industry being modernised in China

Growth of fish production and consumption slower than previously

Value of processed fish products expected to increase

Demand accelerates international fish trade

Trade war between China and the USA creates uncertainty

Tuna markets changing

Salmon market (pp. 13–17) Europe is the main market for salmon

Price of salmon is determined in the global market

High salmon price hinders competitiveness in Europe

Global shortage of rainbow trout continues

Fishmeal and fish oil market (pp. 18–20) El Niño weakened, and the price of fishmeal fluctuated

Fishmeal production in Europe

European market (pp. 21–24) Decrease in fish production in the EU expected to stop

Fish imports in the EU continue to increase

Growth of Norway’s exports to the EU stopped

Domestic market Imported fish (pp. 25–31) Signs of recovery in the Finnish fish market

Value of fish imports increased in 2017

Tuna imports increased

Imports of processed fish products from Poland continued to grow

Imports of frozen fillets remained unchanged

Feed raw materials from Nordic countries

Domestic fish (pp. 32–37) Value of farmed fish increased

Baltic herring comprised the majority of the marine catch

Exports of Baltic herring to Denmark halved

Catch volumes decreased in coastal areas and

increased in inland waters

Price of salmon continued to increase

Finnish food market (pp. 38–40) Prices of food products rising faster than inflation

Retail sales recovering

Views of enterprises (pp. 41–55) Current information from fishery companies

Fish market year 2017 in brief

Variation in salmon prices difficult to estimate

Reliability of estimated futures prices decreased

Turbulence in salmon market continued in 2018

Salmon to Europe via Finland

New salmon production opportunities under

development

Demand for salmon increasing faster than supply

Shortage of rainbow trout

Rainbow trout as expensive as salmon

Interest in wild-caught fish increasing

Finally, a breakthrough in cyprinids

Retail sales of fish developing

Fish trade structures changing

Sources (p. 56)

Further information (p. 57)

Click the arrow to navigate directly to the section under the heading ______________________________________________________________________________________________________________________________

The global market

4

Fish consumption increases

5

The global population growth continues, and the

world population is expected to reach 9.7 billion by

2050. The fastest growth is happening in

developing countries. Eating habits are also

changing. Currently, people eat twice as much

meat and fish than they did 50 years ago. Of all

food products, the consumption of fish and poultry

has increased the most rapidly.

Diversifying diets, urbanisation and improved

distribution channels are also contributing to the

rising demand for fish products. Appreciation of

healthy and sustainably produced food is also

growing. Demand for fish is increasing, as it meets

the demands of modern consumers, and it can be

produced effectively in terms of finances and the

environment.

The catch of wild fish can no longer be increased,

since most wild fish stocks are already being fully

exploited. Advances in aquaculture and feed

production technologies have already long enabled

increasing fish production volumes to meet global

needs.

______________________________________________________________________________________________________ Sources: FAO: The State of World Fisheries and Aquaculture 2018, Marine Harvest Salmon Farming Industry Handbook 2018

Global fish and meat consumption per capita

World production of fish 1950–2016

Beef

Pork

Poultry

Fish and shellfish

Other meat

Kg

per

yea

r

Million tonnes

Aquaculture

Fisheries

In 2017, the global production of fish, crustaceans and

molluscs totalled around 175 million tonnes. Of this, over

91 million tonnes (52%) was caught. A growing proportion

of the catch ends up for human consumption, and

production side streams must now be utilised more

efficiently. World aquaculture production amounted to

over 80 million tonnes. Fish, molluscs and crustaceans

are mainly used for human consumption. The increase in

aquaculture production will continue. The fastest increase

is taking place in Asia. China is the most significant

producer of fish.

______________________________________________________________________________ Sources: FAO: The State of World Fisheries and Aquaculture 2018, Food Outlook July 2018

Aquaculture is among the fastest growing food production

sectors

Utilisation of global fish production in 2017

World aquaculture production volume 1995–2016

Fish production by country in 2016

6

(algae and plants not included)

______________________________________________________________________________ Sources: FAO: The State of World Fisheries and Aquaculture 2018

Fishing industry being modernised in China

7

China is the world’s largest fishing country. China’s goal is to develop its fishing industry in

a more sustainable and market-driven direction. Using quotas, it aims to prevent overfishing

by limiting the fishing capacity and the number of fishermen. Another goal of the new fishing

policy is to modernise fishing vessels, fishing gear and the fishing infrastructure. In addition,

it aims to eliminate illegal, unreported and unregulated (IUU) fishing. China will recover

caught fish stocks with stocking and fishing area limits.

It will also modernise aquaculture. Another goal of the policy is to increase more sustainable

and healthier production. China aims to develop aquaculture in a more intense and energy-

efficient direction. As a result of the new policy, catch volumes in China will decrease

substantially and the increase in aquaculture production will slow.

China is actively expanding towards international

aquaculture markets. In December 2018, Chinese Legends

Holdings acquired a significant salmon farming company in

Chile. The Chinese salmon market is expected to increase

rapidly, and the goal of this transaction was to secure the

availability of raw material.

Growth of fish production and consumption slower than

before

8

Catches will increase by 1%

Catches will decrease in China. This loss

will be compensated through more effective

fishing in other sea areas and through

successful regulation

Catches will be utilised more efficiently

• Stricter laws

• Increases in prices of fish for human

consumption and other uses

Fish farming will grow by 37%

Aquaculture will comprise 60% of total food

production by 2030

The annual growth rate of production will slow

to 2% (5.7% between 2003 and 2016)

• The increase in aquaculture production will

slow in China

• Aquaculture will grow fastest in Latin America

and Africa

______________________________________________________________________________ Sources: FAO: The State of World Fisheries and Aquaculture 2018

Outlooks from 2016 to 2030

Fishing and aquaculture production 1990–2030

Mill

ion

to

nn

es (

live

wei

ght)

Aquaculture for human consumption

Total fishing

Fishing for human consumption

Fish consumption will grow by 6%

• Growth will be fastest in Latin America

• In Africa, consumption is low, and it will

decrease further to 9.6 kg (9.8 kg per capita per

year in 2016)

• More than 70% of fish consumption in Asia

• The annual growth rate of consumption will slow

to 0.4% (1.7% between 2003 and 2016)

• Average consumption will be 21.5 kg per capita

per year in 2030

Value of processed fish products expected to increase

9

Outlooks from 2016 to 2030

Real fish prices to decrease slightly

Prices expected to remain high

Nominal prices of fish will go up1)

Population growth, increasing wealth and

more expensive production inputs in fish

farming keep prices high

The significance of farmed fish for prices in

the entire sector will increase

Internationalisation of trade will continue

Foreign trade in food fish will increase by 24%

The annual growth rate of the food fish trade will slow to 1.7% (2.7%

between 2003 and 2016)

• Slowdown in growth of fish production

• Increase in prices of fish products

• Increase in domestic demand for fish in fish exporting countries

______________________________________________________________________________ Sources: FAO: The State of World Fisheries and Aquaculture 2018, Photo: Norwegian Seafood Council 1) In nominal terms, the price for caught food fish will increase by 17%, for farmed fish by 19%, for fishmeal by 20% and for fish oil by 16%

Fishing Aquaculture

Total fish price index

Changes in FAO fish price index 2000–2018 (2002–2004 = 100)

Demand accelerates international fish trade

The value of the international fish trade is expected

to increase by more than 8% in 2018, driven by the

high demand for fish. Fish production is expected to

increase by roughly 2%. However, this is not

enough to meet demand. Prices are expected to

increase, since the positive economic development

will maintain demand, and the supply of many

species will be insufficient.

Higher prices will improve the financial results of

producers, but fish processors may suffer from

problems resulting from more expensive raw

material. High prices may also have an impact on

consumers’ purchasing decisions.

Regional crises, combined with the escalation of the

trade war between China and the USA, may slow

this development, as both of these countries are

key players in the international fish trade.

Global prices of many agricultural products

decreased during 2018. Prices of dairy products

and plant oils have decreased more quickly, and

meat prices have also moved down.

______________________________________________________________________________ Sources: FAO: Food Outlook July 2018 and The State of World Fisheries and Aquaculture 2018, Pro Fish Association: image bank.

10

World Fish Market

2016 2017 2018 (for.)

Change 2017-2018

Production (million tonnes) 170,9 175,1 178 2,0 %

Capture fishery 90,9 91,5 91,7 0,2 %

Aquaculture 80,8 83,6 87,0 4,0 %

Trade value (USD billion) 142,5 153,1 165,8 8,3 %

Trade volume (live weight) 59,5 60,5 60,8 0,7 %

Total utilization 170,9 175,1 178 2,0 %

Food 151,2 154,4 157,6 2,1%

Feed 14,6 15,6 15,8 1,0 %

Other uses 5,1 5,1 5,2 2,9 %

PER CAPITA CONSUMPTION (kg/year)

20,3 20,5 20,7 1,0 %

From capture fishery 9,5 9,4 9,3 -1,2 %

From aquaculture 10,7 11,1 11,4 2,9 %

FAO FISH PRICE INDEX (2002 - 2003 = 100)

2016 2017 2018 (I – III)

change I – III 2018

ja I – III 2017

146 154 163 8,3 %

Trade war between China and the USA creates

uncertainty

11

______________________________________________________________________________ Sources: Undercurrent 2018; Intrafish 2018

Trade relations between China and the USA have deteriorated, because the USA

believes that China fails to comply with international regulations. The USA has

imposed duties on products imported from China to force China into negotiations.

In addition, China has imposed duties on products imported from the USA. In the

worst case, this situation may escalate into a trade war.

The deterioration in trade relations has affected the steady development of the fish

trade. The duties of 10% imposed by the USA in the summer of 2018 on tilapia

imported from China had no significant impact on trade. However, the threat of

25% import duties increased import volumes and prices of tilapia imported from

China in late 2018. In the summer, China imposed duties of 25% on fish and

shellfish products imported from the USA. The USA reacted quickly to this decision

and imposed duties on fish products imported from China. To prevent these duties

from damaging the financial situation of US fishermen, they did not include

products that use fish caught by Alaskan fishermen as raw material.

The trade war saw a new plot twist in December 2018 when the two countries

announced their intention to start negotiations. At the same time, the USA

announced that it would postpone the entry into force of the duties of 25%.

Tuna markets changing

Tuna is a globally important fish in terms of trade. Tuna markets have been divided

into two product groups. Oily red tuna species, such as southern bluefin tuna, are

used in traditional Japanese sushi and sashimi products. White skipjack tuna and

yellowfin tuna are used as raw material in canned fish production.

Both these markets are facing changes. Eating habits in Japan are approaching

those of the western world, which has decreased consumption of southern bluefin

tuna. The development of canned tuna markets has also stopped in industrial

countries. Some canned fish producers have started to use less expensive tuna

species.

______________________________________________________________________________ Sources: FAO Food outlook July 2018; FAO Globefish: Tuna Market Reports. Photo: Jari Setälä

12

Concerns among environmental associations

over unethical tuna fishing methods and the

poor state of tuna stocks have increased

sustainable fishing. Interest in products with a

high processing value is increasing in industrial

and trade sectors, as raw material prices are

expected to go up.

Salmon market

13

Atlantic salmon is one of the most important fish products in developed industrialised countries and the most important fish in the Finnish market. More than two million tonnes of salmon were farmed in 2017. Salmon production continues to increase in Norway. The positive long-term financial results of fish farming enterprises has increased demand for new farming licences and raised prices. Norway is also investing in new production areas and technologies. However, supply will only increase in a few years.

Atlantic salmon production and market areas in 2017

Europe is the main market for salmon

Total production of Atlantic salmon

______________________________________________________________________________ Sources: Marine Harvest Salmon Farming Industry Handbook 2018, LerØy 2018; FAO Food Outlook July 2018

Total production of the top four producers of Atlantic salmon in 2017

4 top players of farmed Atlantic salmon

Harvest (thousand tonnes GWE) %

Mowi (Marine Harvest) 370 18 %

Salmar 135 7 %

Lerøy Seafood 135 6 %

Mitsubishi 123 6 %

Harvest of top 4 763 37 %

Harvest of Atlantic salmon 2 074 100 %

Price of salmon is determined on the global market

15 ______________________________________________________________________________ Sources: Statistics Norway, FAO Food Outlook July 2018; Global Fish Production Data & Analysis, presented by R. Tveverås;

It is typical for the salmon market that changes in

supply have a considerable impact on prices. In recent

years, demand for salmon has grown faster than

supply, which has kept prices high.

In 2017, global market prices remained at a high level.

At the end of 2017, large volumes of salmon entered

the market, as a result of which prices dropped

temporarily. During the spring of 2018, prices returned

to a record high level. In the summer, prices were lower

than in the previous year, remaining at the same level

throughout the autumn.

Production volumes are expected to increase by 4–5%

in 2018. Production is expected to decrease in

Scotland, whereas the increase in production in

Norway and Chile will balance the situation.

In the medium term, the production of salmon will

increase, while supply will remain insufficient given the

increase in global demand. The expanding range of

salmon products will maintain the increase in demand.

If the financial situation remains positive in the main

market areas for salmon, prices are expected to remain

high.

NOK/kg

Total production of Atlantic salmon, and the producer country

Tonnes

Export prices for fresh Norwegian salmon 2015–2018

Week

High salmon price hinders competitiveness in Europe

The high price reduced the competitiveness of

salmon in European food markets, and the increase

in the consumption of salmon stopped. Europe

remains the main market area for Norwegian

salmon. The highest quantity of salmon was

exported to Poland; however, this showed a

decrease of 6% in 2017. Regardless of its high

price, the consumption of salmon has remained

stable in France. In contrast, the German fish

market responds quickly to changes in prices. In

Germany, the consumption of salmon has

decreased, while the use of less expensive options

has increased.

Exports from Norway to Russia came to a halt in

2014 due to an import ban. China was one of the

most promising export countries for Norway at the

beginning of the 2000s. In 2010, China closed the

border to Norwegian products to protest against the

Nobel Peace Prize being awarded to a Chinese

dissident. Trade relations are now picking up.

Norway is planning to increase its exports to China

and, by 2025, Norway will export 12% of its

production to China.

16 ______________________________________________________________________________

Sources: Statistics Norway, Marine Harvest Salmon Farming Industry Handbook 2018, Intrafish

Exports of Norwegian salmon to Europe

Exports of Norwegian salmon

Global shortage of rainbow trout continues

17

______________________________________________________________________________ Sources: FEAP: Production Report 2008–2016; Global Fish Production Data & Analysis, presented by R. Tveverås; Undercurrent News. Pro Fish Association: image bank.

Global production of large rainbow trout has gone

in the opposite direction to the production of other

salmon species. In the last ten years, the

production of Atlantic salmon and portion-sized

rainbow trout has increased by 70%, while the

production of large rainbow trout has decreased

by 5%.

Chile is the world’s largest producer of large

rainbow trout. Fish diseases and environmental

problems reduced production volumes to one

quarter in five years. In 2016, Chile only produced

70 million kilograms of rainbow trout. In 2017,

production in Chile started to increase, while

global production dropped due to the 25%

decrease in production in Norway. Production

decreased due to the decline in exports to Russia

and the drop in the number of rainbow trout

producers. Global market prices of rainbow trout

have increased rapidly. The price of rainbow trout

exported from Norway to the EU has increased by

more than 60% since 2015.

Norway is the largest producer in Europe. Other

major producers are Finland, France, Denmark

and Sweden; their combined output was around

50 million kilograms in 2016.

Production of rainbow trout, and producer country

E

Fish oil and fishmeal market

18

El Niño weakened and the price of fishmeal fluctuated

19 ______________________________________________________________________________ Sources: OECD-FAO Agricultural Outlook 2014- 2023, FAO Globefish, FAO Food Outlook July 2018, World Bank Commodity prices 1) Nominal prices, USD 1 = EUR 0.85 (28 August 2018)

In 2017, the production of fishmeal increased to 4.6 million tonnes. Approximately 20% of the global fish

catch is used to produce fishmeal and fish oil. Over a quarter of the raw material for fishmeal consists of side

streams from the industry. The coast of South America is the most important production area. In recent years,

catches in the area have varied considerably as a consequence of the El Niño phenomenon. In 2017, the

impact of El Niño on fishing decreased, and anchovy stocks increased in Peru. As a result of high catch

volumes, the prices of fishmeal and fish oil fell to a relatively low level. China exploited this market situation

and acquired more than one million tonnes of fishmeal in stock. At the end of 2017, catch volumes were lower

than expected, leading to an increase in prices. In 2018, catch volumes were high, and prices dropped.

Chinese imports are expected to pick up, as China’s production of fishmeal is decreasing due to stricter

environmental regulations.

Fishmeal producer countries 2017 Fishmeal prices 2011–2018 1

Fishmeal production in Europe

______________________________________________________________________________ Sources: Eumofa. Photo: Kasnäs fishmeal plant, Jari Setälä

20

In the EU, fishmeal production totals more than 500 million kilograms, accounting for 10% of the global

production volume. Denmark is the largest producer, accounting for nearly half of all production in the

EU. Other significant producers include Norway and Iceland. Production volumes depend on the

availability of raw material. In 2017, many fishing quotas were increased, e.g. sand lance by 460%

and blue whiting by 85%. As a result, fishmeal production increased in the Nordic countries in 2017.

Baltic herring and sprat caught in the Baltic

Sea are also used as raw material for

fishmeal. They are used as raw material at

fishmeal plants in Denmark. Finland’s first

fishmeal plant was opened in Kimitoön in

2016. It produces more than 40 million tonnes

of fishmeal and fish oil annually. A new

fishmeal plant has also been opened in

Estonia.

Fishmeal production in Europe

European market

21

______________________________________________________________________________ Sources: Eurostat: Fishery Statistics

22

Decrease in fish production in the EU expected to stop

In 2000, catch volumes in the EU still exceeded 6 million tonnes. Volumes then decreased until 2008, after which

they have slowly recovered. Variation in catch volumes was high between different countries from 2008 to 2016.

Catch volumes have increased in Poland (70%), Croatia (47%) and Finland (36%). Correspondingly, they have

decreased in Lithuania (-33%), Latvia (-27%) and Estonia (-26%). The largest fishing countries in the EU are

Spain, the UK, Denmark and France, accounting for 55% of the total catch volume in the EU.

In 2016, the total catch volume in the EU was 5 million tonnes. The value of the landed catch increased by more

than 7% to EUR 7.5 billion in 2016. More than a quarter of this value came from Spanish ports where valuable

fish species are processed. In 2016, Denmark was the most significant receiving country in the EU. More than a

fifth of the total catch volume in the EU was received at Danish ports. However, the value of processed fish was

only 7% of the total value in the EU, since Denmark receives high volumes of feed raw material.

Aquaculture production has remained at roughly

1.3 million tonnes. Blue mussels comprise nearly

a quarter of this production. Spain, the UK and

France are the largest producers, accounting for

more than half the total production volume in the

EU.

The value of production is more than EUR 4

billion. Of this, the value of farmed salmon is more

than EUR 900 million. More than 90% of salmon in

the EU is produced in the UK.

Fish production in the EU

1000 tonnes

Aquaculture

Capture fishing

______________________________________________________________________________ Sources: Eurostat, EUMOFA Monthly highlights 5/2018; EUMOFA The EU Fish Market 2017

EU’s trade deficit increases

Fish imports in the EU continue to increase

23

Demand for fish in the EU is strong. In recent years, the

improved economic situation has increased demand for

fish products. In 2017, the value of fish imports to EU

countries increased by 5% to EUR 24.6 billion. This

resulted from the continuing increase in import prices. At

the same time, import volumes increased by 0.5%.

In this decade, consumer prices of fish have increased

twice as fast as prices of other food products. In the EU,

consumer prices of meat and fish increased in step until

2013. After this, the price of fish continued to increase,

while the increase in the price of meat and other food

products stopped.

Import value increasing Development of consumer prices 2010=100

Food

Meat Fish and shellfish

The EU remains the most important export area for

Norwegian fish. In 2017, Norway exported 1.6 million

tonnes of fish products to the EU. The proportion of the

EU in the value of Norwegian exports has decreased

slightly. In 2017, it was 65%. The euro-denominated

value of exports decreased, while the export volume

increased by roughly 2%. Exports to Asia continue to

grow. The export volume increased by 12% to 500,000

tonnes.

The processing rate of exported fish products is low.

Nearly 70% of all fish is exported from Norway without

any processing. The processing rate of exported salmon

was only 17%. Nearly all salmon is exported gutted,

either as fresh fish or frozen products.

In 2017, Norway’s total fish production remained at 3.7

million tonnes. Norway exported 2.6 million tonnes of

fish products at a value of nearly EUR 12.9 billion. The

export volume of aquaculture products, i.e. mainly

farmed salmon, remained at one million tonnes, and

their value remained at EUR 9 billion. Denominated in

Norwegian krones, the value increased by 3.5%.

The high price of salmon reduced its demand in its

main market area in Europe. This was reflected in the

price of salmon at the end of 2017.

Growth of Norway’s exports to the EU stopped

24 _______________________________________________________________________________________________________ Sources: Statistics Norway, Norwegian seafood Council

Total value of Norwegian fish production 2007–2017 Value of Euro to Norwegian krone

Domestic market Imported fish

25

_______________________________________________________________________________________________________________________ Sources: Luke statistics on commercial marine and inland fishery, aquaculture production, fish processing and foreign trade

Signs of recovery in the Finnish fish market

26

Demand for fish in the domestic food

market has doubled since the early

1980s. Domestic fish has been

replaced by imported fish. In the early

1980s, half of fish was domestic, while

in 2017, imported fish accounted for

82% of the total supply. Farmed

salmonids account for half the market,

of which most consists of imported

fish.

For a long time, demand for salmonids

increased in Finland at the same pace

as the global production of Atlantic

salmon. In particular, salmonids have

replaced Baltic herring, which was the

most important commercial fish in the

early 1980s. Today, it is Norwegian

salmon. In recent years, the increase

in demand for salmonids has stopped

due to the high price of salmon. In

addition, the import volume of rainbow

trout farmed in Sweden has

decreased, as new farming licences

have been difficult to obtain. The

decrease in demand for Baltic herring

has stopped.

Finnish fish market 1981–2017

In 2017, some 27 million kilograms of fresh salmon imported from Norway

remained in Finnish markets. Some 9 million kilograms of rainbow trout were

imported from Sweden. More than 28 million kilograms of other imported fish

were consumed. Slightly less than 11 million kilograms of domestically farmed

rainbow trout were sold in Finnish markets. The same figure for Baltic herring

was roughly 4 million kilograms, and approximately 6 million kilograms for other

wild-caught fish.

Food fish

As fillet weight Million kilos As fillet weight

Imported fish other than salmonids

Capture fishery other species

Imported fish, other than salmonids

Imported salmonids

Other fish, farmed in Finland

Large rainbow trout, farmed in Finland

_______________________________________________________________________________________________________ Sources: Luke statistics 1) Fresh salmon sold exported to Europe via Finland excluded from imports; its value was EUR 96 million

Value of fish imports increased in 2017

27

In 2017, the value of fish product imports to Finland

totalled EUR 510 million. Of this, products intended

for human consumption accounted for EUR

390 million.1 Of this, fresh whole salmon imported

from Norway, further exported to the rest of Europe,

comprised EUR 95 million. In 2017, more than 15

million kilograms of salmon passed through Finland,

whereas the corresponding figure in 2016 was one

million kilograms. Excluding this, the value of fish

imported to Finland for human consumption

increased.

In 2017, the value of fish product imports increased

by 5% from the previous year. In turn, the value of

imported crustaceans, molluscs and fish roe dropped

further by 19%. Approximately 61% of fish imported

for human consumption consisted of fresh fish. Fresh

fish is mainly imported from Norway and Sweden,

and over the last three years, increasingly from

Estonia.

Value of fish imported for human consumption by main product group 2017

Value of imports by fresh products and other fish products in 2017

Total value 394 million euro

_______________________________________________________________________________________________________ Sources: Luke statistics

Tuna imports increased

27

In addition to salmonids, considerable amounts of

other fish and fish products are imported into

Finland. The value of imports of these products

increased until 2013, after which the import volume

of tuna decreased. In 2017, however, the import

volume of tuna increased by nearly 10%, and its

value by 15% from the previous year. Imports of

tuna from the Seychelles and Mauritius have

increased in the 2010s as a result of the EU’s duty

reliefs. Thailand is the world’s largest producer of

canned tuna. Finland has traditionally imported

tuna from Thailand. However, the import volume

has decreased in recent years. In 2017, imports

from Thailand increased.

Value of non-salmonid imports 2003–2017

Value of imports of fish products 2003–2017 Imports of canned tuna by country

_______________________________________________________________________________________________________ Sources: Luke statistics

Imports of processed fish products from Poland continued

to grow

29

Value of fish imported from Estonia and Poland 2002–2017 Estonia and Poland accounted for 6% of the total value

of all fish product imports in 2017. The value of imports

from Estonia totalled EUR 19 million and from Poland

EUR 11 million. Imports from Poland increased

significantly in 2017, whereas imports from Estonia

remained roughly at the previous year’s level.

Fresh cod fillets were imported from Estonia at a value

of EUR 3 million, and salmon products at a value of

EUR 4 million. Imports of smoked and frozen salmon

fillets from Poland continued to increase, and their value

was nearly EUR 6 million. The volume of frozen saithe

imported from Poland was higher than previously.

Value of processed fish products imported from Estonia 2002–2017

Value of processed fish products imported from Poland 2002–2017

____________________________________________________________________ Sources: Luke statistics. Pro Fish Association: image bank.

Imports of frozen fillets remained unchanged

30

Imports of frozen fillets remained stable for a

long time, but in 2015, imports declined by a

fifth, and the same level was maintained in

2017. Imports of frozen salmon and rainbow

trout fillets decreased slightly from the

previous year.

In the early 2000s, two-thirds of frozen fillets

imported into Finland were saithe. Since then,

nearly half of saithe imports have been

replaced by the less expensive Alaska pollock.

China’s share of frozen fillet imports has

decreased in recent years, while the

importance of Poland has grown.

Frozen fillet imports 2002–2017

Saithe and Alaska pollock import countries 2002–2017

__________________________________________________________________________________ Sources: Luke statistics

Imports of fishmeal have declined as fishmeal used in

fish feeds has been replaced by plant-based raw

materials and domestic fishmeal. Fish fat and fish oil

import volumes have remained more stable. In 2017,

fish waste and most fish oil were imported from

Norway. Fishmeal was imported from Denmark and

Iceland. Fish waste is used in feed for fur animals.

The demand for fish waste grew in the early 2010s

and was at its height in the fur industry’s peak year of

2013. Since then, demand for fur, and consequently

for fish waste, has declined. In 2017, imports of fish

waste increased slightly.

Prices for fish fat, fish oil, fishmeal and fish waste 2002–2017 Value of imported fish fat, fish oil, fishmeal and

fish waste 2002–2017

Imports of fish fats and fish oil, fishmeal and fish waste 2002–2017

Feed raw materials from Nordic countries

31

Fish waste

Fishmeal

Fish fat and fish oil

Fish waste

Fishmeal

Fish fat and Fish oil

Fish waste

Fishmeal

Fish fat and Fish oil

Domestic market Domestic fish

32

__________________________________________________________________________________________________________________________________ Sources: Luke statistics

Value of farmed fish increased

33

15.1 million kg

Volume and value of food fish production by main products in 2017

Food fish production 1980–2017

Finland’s food fish production increased

rapidly in the 1980s and was at its highest at

the turn of the 1990s, standing at more than

19 million kilograms. Since then, production

has declined due to tightening international

competition and environmental restrictions. In

recent years, fish farming conditions have

been favourable, and there has been a slight

increase in aquaculture production. Some new

production licences have also been granted.

Rainbow trout accounts for the majority of

production and its value. European whitefish

is the next most important species. In 2017,

production was more than 14 million

kilograms, at the same level as the previous

year. The value of aquaculture increased,

driven by the growing prices of rainbow trout

and European whitefish. In 2017, the value of

production grew by 25% to nearly EUR 70

million. Attempts have been made to diversify

production, but the share of other species of

the total volume has remained modest.

86,6 million euro

Sea

Inland

Value Val

ue

Vo

lum

e

__________________________________________________________________________________________________________________________________ Sources: Luke statistics. It was expected that the Baltic herring landed in Sweden would be used as raw material for fishmeal. Pro Fish Association: image bank.

In 2017, the commercial fish catch in Finland’s sea

area totalled approximately 155 million kilograms, with

a value of about EUR 36 million. Baltic herring and

sprat accounted for 97% of the total volume and 78%

of its value. In 2017, Baltic herring and sprat were

mostly used as feed for fur animals. Baltic herring and

sprat were exported to Denmark as raw material for

fishmeal and fur animal feed. Exports to Denmark

have decreased, as the Danish industrial fish quota

increased significantly in 2017. Domestic fishmeal

comprised a quarter of Baltic herring and sprat use.

Baltic herring and sprat were exported to Eastern

Europe as food products. The domestic consumption

of Baltic herring as a food product was roughly 3%.

Commercial marine catch 2000–2017

Use of Baltic herring and European sprat in 2017

Baltic herring comprised the majority of marine catch

34

150 million kg EUR 150 million

Exports of Baltic herring to Denmark halved

35

In 2017, the value of fresh and frozen Baltic herring exports

amounted to EUR 7.7 million. The volume of fresh Baltic herring

exported to Denmark halved from 2016. Denmark remains the most

important export country. In addition, the value of Baltic herring

exported to Sweden and Estonia was more than EUR 1 million. The

export price remained at the previous year’s level.

Export volumes of frozen Baltic herring continued their recovery.

Exports to Estonia have recovered. In 2017, nearly 60% of all

frozen Baltic herring was exported to Estonia. Although more than

20% was exported to Denmark, the export volume decreased by

nearly a quarter from the previous year. Exports to Eastern Europe

remained at the previous year’s level. Exports of frozen Baltic

herring to Russia is still banned by Russia.

Fish-based raw materials were exported to Denmark at a value of

more than EUR 8 million, and fishmeal at a value of EUR 1.6 million

in 2017.

.

Export volumes and prices of fresh Baltic herring

Export volumes and prices of frozen Baltic herring

_______________________________________________________________________________________________________ Sources: Luke statistics

Feed raw materials exported to Denmark

Fishmeal

Frozen Baltic herring

Fresh baltic herring

Fish waste

_______________________________________________________________________________________________________ Note: The coastal commercial catch only includes the species shown in the image caption. In addition, some of the salmon was caught in the southern reaches of the Baltic Sea. Sources: Luke statistics

Most of the coastal and inland water commercial

catch is consumed in Finland. In 2017, coastal

catches of perch, pikeperch, salmon and

European whitefish decreased significantly. The

catch of roach was also much lower than

previously. However, the coastal and inland water

catch of smelt was high.

In inland waters, the vendace catch was more

than 3 million kilograms. The pikeperch catch

was higher than in previous years. In addition,

catches of smelt and cyprinids have remained

high.

Commercial coastal catch (excl. Baltic herring, sprat and cod) 2000–2017

Inland fishery catches (excl. vendace) 1998–2017 Inland fishery catches 1998–2017

Catch volumes decreased in coastal areas and increased in

inland waters

36

_______________________________________________________________________________________________________ Sources: Luke statistics, Pro Fish Association: image bank

Baltic herring producer prices 2000–2017

Producer prices for other fish 2000-2017

Price of wild salmon continued to increase

37

The price paid by the processing and feed

industries for Baltic herring remained at the

previous year’s level. The price paid for exported

Baltic herring was a little lower than in the

previous year.

Prices of other wild fish, apart from perch,

increased slightly. The price of wild salmon

increased most.

Finnish food market

38

Prices of food products rising faster than inflation

39 _______________________________________________________________________________________________________ Sources: Statistics Finland, Finnish Grocery Trade Association

The four-year decrease in food prices stopped in

2017. In 2017, consumer prices of food increased

more slowly in Finland than in the rest of the EU.

In 2018, however, food prices have increased at

the same rate in Finland and in the EU. Average

food prices have grown more quickly than other

consumer prices. As demand for food increases,

the increase in production costs has shifted to

consumer prices.

Positive economic development is expected to

strengthen meat prices. The consumption of meat

is also expected to increase. Poultry meat, in

particular, is consumed more than previously, as it

is used as a substitute for pork and beef.

Fish prices diverged from other food prices at the

end of 2015 when the price of fresh salmonids

sharply increased. Since then, the price of fresh

fish has shown significant fluctuation in the retail

trade. These fluctuations have also been reflected

in the price of smoked and cured fish. The price of

other fish and shellfish products has followed the

general development of food prices.

Comparison of general price index with food prices

Comparison of fish product groups with the food price index

(2010 = 100)

(2010 = 100)

Retail sales recovering

40

In 2017, the value of retail sales totalled EUR 17.6

billion, showing an increase of 1% from the year

before. Particular growth was seen in large shops,

i.e. supermarkets and hypermarkets. These

accounted for two-thirds of total retail sales.

S Group was the largest trade group, and its market

share increased to 46%. It was boosted by the

Prisma chain, whose sales increased by 4.3%. K

Group increased its market share as a result of the

acquisition of Suomen Lähikauppa Oy in 2016.

Currently, K Group has the broadest network of

shops in Finland. K Group’s Citymarket stores

increased their sales by 4.5%.

Lidl increased its sales by 5.5%, i.e. significantly

more quickly than the general market development.

The chain opened a number of new outlets, and its

market share increased to 9.3%.

_______________________________________________________________________________________________________ Sources: Finnish Grocery Trade Association, Nielsen Finland

Market shares of retail trade groups 2017

Changes in the value of retail sales

Views of enterprises

41

• Ab Salmonfarm Oy

• Arvo Kokkonen Oy

• Chipsters Oy

• Escamar Seafood Oy

• Finn Export Group Oy

• Finnish Freshfish Oy

Kalamesta

• Heimon Kala Oy

• Hätälä Oy

• Kalaliike Eriksson Oy

• Kesko Corporation

• Kalaneuvos Oy

• Kalaset Oy

• Kolvaan Kala Oy

• LerØy Finland Oy

• Länsirannikon Kala Oy

• Martin Kala Oy

• Raisio Oyj

• Suomen Sillikonttori Oy

Current information from fishery companies

42

PANEL

__________________________________________________________________________________________________________________________________

Fish market year 2017 in brief

43

• The price of salmon was at a record high at the beginning of the year. By March, the

price had dropped to the previous year’s level. It then increase again and remained high

until the autumn. The price of salmon was too high for campaigns.

• There was a significant shortage of rainbow trout in the spring.

• The availability of Baltic herring was reasonable, coastal fishery catches were poor,

pikeperch and vendace were caught from inland waters, and demand for roach

increased.

• The price of salmon started to decrease in the autumn. Prices dropped until almost the

end of the year, contrary to normal circumstances.

• Fish processors purchased low-priced salmon in stock, and salmon campaigns picked

up.

• The year was good for rainbow trout farming. Exports boomed, and prices were high.

• The structural change in the fish trade continued throughout the year. • Kala-Apu Oy, a company specialising in forwarding and processing, ceased its operations in

March.

• In the summer, Apetit Kala Oy sold its fish operations to Insula AS, a Norwegian holding

company. Escamar Seafood Oy was established.

• Triotrading Oy, a company specialising in salmon sales and fillets, was sold to Estonian

Saaremere Kala AS in the autumn.

PANEL

__________________________________________________________________________________________________________________________________ Sources: Ultika, nominal prices

Variation in salmon prices difficult to estimate

44

• It is more difficult than previously to estimate salmon prices.

• Trading is more price-sensitive, and price changes are high. • Fish farmers expect prices to go up and make use of ideal farming conditions before selling.

• Fish processors make use of price fluctuations by freezing fish when prices are low.

• When prices are high, fish processors only purchase small amounts of fish and wait for the

prices to drop. Fish processors prefer to buy low-priced small salmon.

• Farming quotas or fish lice may force farmers to butcher their fish prematurely,

in which case cheap fish enters the market.

• If the price drops below EUR 6, demand goes up, as retail groups increase their

campaigning significantly.

PANEL

Salmon imports from Norway 2012–2017 Price

__________________________________________________________________________________________________________________________________ Sources: Fish Pool ASA

Reliability of estimated futures prices decreased

45

• The high price of salmon (already in 2016) reduced demand for salmon in Europe, with

a small delay. • Large buyers in Europe did not renew their purchase agreements with the previous terms and

conditions. Instead, Norwegian producers were forced to sell at a lower price at the end of

2017. This was necessary, as stock levels were high in the autumn.

• Trading on futures via Fish Pool was less active than previously. • The reliability of futures prices was low, as they were based on a small purchase volume.

• When prices go up, major salmon producers avoid large sales agreements.

PANEL

Realised salmon prices at Fish Pool (price index) and futures prices October 2017 – September 2018

EUR

Futures price

Fish Pool Price index

______________________ Sources: Fish Pool ASA

Turbulence in salmon market continued in 2018

46

• The low price at the end of 2017 was reflected in demand. At the end of the year, fish

processors filled their frozen stocks, and salmon campaigns became more frequent. At the

beginning of 2018, salmon prices remained low, and the consumption of salmon was higher

than during the corresponding period last year, both in Finland and in the rest of Europe.

• At the end of February, prices increased sharply, as the available fish volume was lower than

expected due to poor growing conditions in cold waters.

• In the spring, prices were unusually high as a result of public holidays at the beginning of May.

This caused interruptions in salmon butchering, causing a shortage of fish in the markets. In

addition, fish farmers delayed fish sales to better use the warm growing season in the late

spring.

• As a result, the fish volume was high at the end of May, prices started to drop, being lower

than in the previous year throughout the summer, and salmon campaigns increased once

again.

• In the autumn, prices remained low, as they did in 2017.

PANEL

Fish Pool Index/Salmon price 2017 and 2018

2017

2018

EUR per kg

__________________________________________________________________________________________________________________________________ Sources: Luke statistics, Ultika database of Finnish Customs

Salmon to Europe via Finland

47

• Since the end of 2016, more salmon than ever before has been

imported into Finland.

• This salmon is probably exported by Norwegian companies, declared

in and transported through Finland, and exported to Eastern and

Central Europe.

• Norwegian export statistics support this assumption. Norwegian

exports to Finland are at the same level as the volume of gutted

salmon remaining in Finland.

• The amount of salmon exported via Finland was approximately 15

million kilograms, and its value was EUR 96 million.

Imports of fresh salmon per month

__________________________________________________________________________________________________________________________________

New salmon production opportunities under development

48

• Salmon production in Norway is expected to increase by 6% in 2018.

• Farming quotas limit the increase in production in sea areas.

• The coast of Norway has been divided into production areas where production can be

lowered or increased according to the fish lice situation. • During warm years, fish lice present a major problem, particularly in Southern and Central

Norway.

• Norwegian fish farming companies have actively established new recirculating systems

inland to produce new fish. • Smolts are allowed to grow larger than previously to increase the salmon turnover, make fish

processing more efficient and keep the fish lice problem under better control.

• These new methods reduce the farming cycle by 6–12 months. This means much more fish can

be produced in current sea areas governed by fishing quotas.

• The plan is to allow fish to grow larger on offshore fish farms, where fish lice do not present a

problem.

• The Norwegian government may grant new development licences, with a view to

motivating investments in new marine farming technologies • The high price of salmon has enabled fish farmers to make investments.

• Motorised fish farms could make use of larger water areas as necessary.

• On large gutting and processing ships, fish can be transported from farms as fresh or

processed fish directly to markets in Central Europe.

PANEL

__________________________________________________________________________________________________________________________________ 49

• Demand for salmon is expected in increase by 9% in 2018. • Demand for salmon is increasing in China, where salmon is exported through its

neighbouring countries. However, direct imports from Norway may also become possible.

• Chinese operators prefer to acquire European fish enterprises and are studying fish production technologies, sales and markets.

• China may cause a shortage of raw materials and change the salmon trade radically, and the role of trade policies may increase.

• As a result of high demand, salmon may become a luxury product. • However, political risks are particularly high in China.

• Demand in Russia depends on oil prices. • If the price of oil goes up, demand for salmon and rainbow trout will increase in Russia.

Demand for salmon increasing faster than supply

PANEL

__________________________________________________________________________________________________________________________________ Sources: Luke statistics, Ultika database of Finnish Customs

Shortage of rainbow trout

50

• The availability of rainbow trout is insufficient in Finland, and the shortage of raw material is

expected to continue. The volume of fresh rainbow trout used in the Finnish processing

industry was lower than in previous years.

• Global supply of rainbow trout has decreased significantly, and production has become

centralised.

• Fish processors producing their own raw material are able to keep their marketing and

production chains under better control. Other fish processors faced problems with the

availability of raw material. The volume of rainbow trout imported from Sweden decreased.

This was compensated by imports from Denmark.

• Fish processing based on rainbow trout is

vulnerable if the production of rainbow trout

continues to decrease.

• The situation will become critical in Finland if

new farming licences are not granted in the

near future.

• The Swedish licence policy has become

stricter. Finnish operators are looking for

opportunities in the open sea and Estonia.

• Fish processors do not believe that recirculating

systems can significantly increase the supply of

rainbow trout.

Fresh rainbow trout remaining in Finnish markets

PANEL

__________________________________________________________________________________________________________________________________ Sources: Luke statistics

Rainbow trout as expensive as salmon

51

Exports of fresh rainbow trout 2011–2017

Domestic producer price of large rainbow trout and price of salmon imported from Norway

PANEL

Domestic producer price of large rainbow trout Price of salmon Imported from Norway

• The integration of processing and farming and the concentration of production

enabled an increase in rainbow trout exports.

• The volume of fresh rainbow trout exports was nearly 3.5 million kilograms. This

means that exports remained at nearly the same level as in 2016.

• The value of exports increased to nearly EUR 20 million.

• Rainbow trout was mainly exported to Estonia, Belarus and Poland. Exports to

Poland increased significantly in 2017. Japan is also showing high demand.

• Growing demand has increased the price of rainbow trout. In the autumn of

2017, the average price of rainbow trout was nearly identical to the price of

imported salmon.

__________________________________________________________________________________________________________________________________

Interest in wild-caught fish increasing

52

• The high price of salmon and the shortage of rainbow trout have raised interest in the processing

of wild-caught fish. • Processors and wholesalers are concerned about the decrease in the number of coastal

fishermen; something should be done about seals and cormorants. • Many large wholesalers have invested in the collection of wild-caught fish and are now

purchasing fish directly from individual fishermen. • As coastal fishery catches decrease, the focus is shifting to inland fishery catches. • Of wild-caught fish, the availability of Baltic herring and vendace is sufficient, as is that of

European whitefish, perch and pikeperch periodically. • The supply of perch is supplemented by fish imported from Estonia. The price of fish imported

from Estonia is approaching that of domestic fish. Some pikeperch farmed in recirculating systems is imported from Denmark.

• Pikeperch fishing in the Archipelago Sea will stop if the lowest permitted length is increased.

• The decrease in demand for Baltic herring has stopped. • Operator-specific Baltic herring quotas cause concern, as food fish quotas were too low in

practice. These quotas should be increased. • Buyers of Baltic herring often need to rely on small herring imported from Sweden. Its

quality is not sufficiently high. • New operators are entering the Baltic herring processing market.

• Investments are being made in wild-caught minced fish and related products.

PANEL

_________________ Source: Preliminary data from the Uusivu project

Finally a breakthrough in terms of cyprinids

53

• The volume of cyprinids has increased in coastal and inland water areas. • Several projects have been carried out over recent decades to increase the use of cyprinids in

the food industry. There have been especially many projects in recent years. • Many enterprises have also invested in the processing of cyprinids. • In 2018, at least 12 enterprises produced minced or canned fish using cyprinids. • Roughly 800 tonnes of cyprinids were caught from the sea and lakes and used in food

production. • The most common inland water species used in fish processing was roach. Other

significant species included common bream and blue bream. Of marine fish species, common bream is nearly exclusively used in fish processing.

• More than two-thirds of raw material were caught from lakes. The majority of fish caught from the sea is also processed onshore.

• Nearly 90% of processed cyprinids were minced, mainly for use in fish steaks. • The sustainable use of cyprinids can be increased further.

Estimate of domestic cyprinids used in food products

Retail sales of fish developing

54

• Salmonids have traditionally been significant loss leaders in retail sales. When the

price is high, fewer salmon campaigns are carried out and consumption decreases.

The price level used in campaigns has increased.

• Previously, retail chains supported price campaigns and sold fish at prices lower than

wholesale. Campaigns covered fresh fish, while the prices of processed fish products

were kept stable, offering a high profit margin.

• Any changes in raw material prices are now reflected more clearly in the prices of all

end products.

• Lidl deviated from conventional practice and opened new paths for the fish trade. • Strict procurement requirements and quality control systems

• Improved corporate image through fish product brands (Isokari) and quality

• Campaigns expanded to processed fish products

• Lidl is expanding this concept to other European countries, which will open export markets

for Finnish fish processors

• Expensive salmon was kept on the menu at restaurants. At lunch restaurants,

however, the serving size of salmon decreased and fresh salmon was replaced by

frozen salmon, less expensive fish, chicken or meat.

• Retailers aim to get a profit from salmon and are investing more in fish and fish

products.

PANEL

__________________________________________________________________________________________________________________________________

Fish trade structures changing

55

• Corporate arrangements continued • In October 2015, the Hukkanen family acquired Taimen Oy and expanded operations from fish

processing and wholesale to fish farming. V. Hukkanen Oy changed its name to Kalaneuvos Oy.

Taimen Oy and Ålands Fiskförädling Ab, parts of the same group of companies, started operating

under the name of Nordic Trout Oy. Nordic Trout Oy farms fish in Mainland Finland, the Åland

Islands and Sweden.

• In October 2016, Swedish Martin&Servera acquired Ab Chipsters Oy, based in Åland. As a result,

Ab Chipsters Oy expanded from being a provider of fish products into a full-service HoReCa

company.

• Kala-Apu Oy, a company specialising in forwarding and processing, ceased its operations on 31

March 2017.

• On 29 June 2017, Apetit Kala Oy sold its fish operations to Insula AS, a Norwegian holding

company. The transaction was confirmed on 1 November 2017. Insula AS owns several fish

processing and farming companies in the Nordic countries. Escamar Seafood Oy was established

for fish processing operations.

• On 28 August 2017, Triotrading Oy, a company specialising in salmon sales and filleting, was sold

to Saaremere Kala AS. Following the transaction, the company is part of Estonian AS PRFoods, a

group to which Heimon Kala Oy also belongs.

• On 15 May 2018, Orkla Foods Finland Oy closed its herring plant in Turku.

• On 9 June 2018, Kalatukku E. Eriksson, a company specialising in restaurant clients, was sold to

Kespro. Kespro is Finland’s largest HoReCa wholesaler and part of Kesko.

• Hätälä Oy and Kalaneuvos Oy are planning significant investments in fish processing. These would

enable increased, diversified and more effective fish processing and an advance in exports of new

products and processed fish.

• The fish trade and processing will integrate with primary production and become more

concentrated, professional and international.

Sources

56

FAO: www.fao.org/state-of-fisheries-aquaculture

reliefweb.int/report/world/food-outlook-biannual-report-global-food-markets-july-2018

www.fao.org/in-action/globefish/market-reports/tuna/en/

www.undercurrentnews.com/

Fishmeal www.worldbank.org/en/research/commodity-markets

www.fao.org/3/a-i3818e.pdf

www.fao.org/in-action/globefish/market-reports/fish-oil-and-fishmeal/en/

Europe, EU www.feap.info

www.eumofa.eu

https://ec.europa.eu/eurostat/web/fisheries/data

Salmon market http://marineharvest.com/globalassets/investors/handbook/2018-salmon-industry-handbook.pdf

www.ssb.no/

www.seafood.no/

www.intrafish.com

blancchamp.be/wp-content/uploads/2018/05/production-report-2017_web.pdf

fishpool.eu/price-information/spot-prices/

Finnish statistical databases statdb.luke.fi/PXWeb/pxweb/fi/LUKE/

uljas.tulli.fi

www.stat.fi/

Finnish food market www.ptt.fi/

www.pty.fi/

www.nielsen.com/fi/fi.html

Further information

57

For further information on the fishery market, please contact:

Jari Setälä, researcher, jari.setala@luke.fi, tel. +358 29 532 7682

Kaija Saarni, researcher, kaija.saarni@luke.fi, tel. +358 29 532 7682