1. Scottish Seafood Partnership “Challenges & opportunities facing the seafood sector” Libby Woodhatch, CEO, Seafood Scotland 3 May 2012

2. Agenda  Introduction  Challenges & opportunities in the seafood processing sector  Exploiting opportunities 2

3. 3 Pelagic £184M Shellfish £164M Whitefish £152M

4. Seafood businesses Fisheries management - Days at sea - Quotas -Discards - Technical measures -RTCs - Poor science Politics - CFP reform - Iceland/ Faeroes - NGOs Business - Rising utilities -Lack of skilled labour -Lack of new entrants -Legislation -SMEs -Limited collaboration Lack of investment Economy - Euro zone crisis - Global recession - Reduced margins Global competition - Imports -IUU -Cheaper proteins Environment - Weather - Climate change - Fisheries biology Lack of continuity of supply CHALLENGES

5. 5 Mixed messages…………….

6. Whitefish – key issues Fisheries management regime –Adverse impacts from Cod recovery measures Cost of leasing quota Lack of foresight on landings New control regulation on weighing Haddock – size profile limiting Fragmented industry –Limited collaboration –SMEs Transport surcharges Competition from Norway 6

7. Nephrops – key issues Cod recovery measures –RTC –Introduction of selective gear Poor fishing Euro-zone volatility –Lack of available credit to customers 7

8. Scallops – key issues Markets currently buoyant –South America year class issues –Japan significant producer pre-tsunami & Fukushima Lack of alignment between some vessels & processors –Price Forgotten sector? –SG Scallop Working Group only met once (2008) –Western waters management group addressing this now for Area VII? –Lack of control measures –UK fishery, nomadic fleets –Over capacity? 8

9. Crab & lobster – key issues Lack of enforcement Lack of effort control or restrictive licensing Lack of robust scientific data Variable quality Higher waste disposal costs reducing competitiveness Forgotten sector? –Crab & lobster Working Group abruptly ended despite time and investment 9

10. Pelagics – key issues Iceland & Faroese situation –Continuing loss of market share –Suspension of MSC accreditation –Future loss of quota? Limited supplies, short seasons Norwegian competition –Scottish vessels landing in to Norway –Market perception –IPR support for UK companies limited 10

11. Seafood processor Industry Collaboration -NE supply forum -Advanced Landings System -Cost sharing Industry Collaboration -NE supply forum -Advanced Landings System -Cost sharing External collaboration -SE/SDI -SF&D, QMS - eNGOs External collaboration -SE/SDI -SF&D, QMS - eNGOs Traditional export -Provenance - Green credentials -New market segments -Quality & taste Traditional export -Provenance - Green credentials -New market segments -Quality & taste Diversity of species Emerging markets -Growing middle class -Younger populations -- Desire for imported goods Domestic market - Provenance -Healthy -Fresh & local -Green credentials -Low food miles OPPORTUNITIES

12. Advanced landing information 12

13. Advanced landing information 13 System reliant on vessels & agents inputting data Key foresight information missing: –No. of vessels at sea –No. of vessels at sea but not fishing (oil jobs etc) Available via electronic log books –Provision of data agreed in principle with Marine Scotland –Charge of £4800 + VAT! –Would still require approval from skippers by SFS

14. The UK Food Service Sector The value of the UK Foodservice sector FOOD sales is estimated at just under £42bn, with sales to operators/outlets equating to £13bn. These 259,054 outlets serve 8.1 billion eating occasions a year = Opportunities for Scottish seafood from fish & chip shops to fine dining 14

15. UK Food Service Project Working collaboratively with SAOS, SF&D & industry to maximise opportunities for Scottish seafood The Foodservice channel is highly fragmented compared to Retail. 5 Retailer Groups account for 90% of the Retail channel compared with 2800 Foodservice groups accounting for only 48% share of sales ! 15

16. UK Food Service Project 1.Food service sector mapping 2.Development of networks with all seafood buyers 3.A support programme to match Scottish suppliers with new opportunities 4.Educational programme for buyers and consumers to raise awareness of Scottish provenance. Awaiting formal confirmation of funding from EFF PAC 16

17. 17

18. Developing emerging markets for Scottish seafood 2012 - 2014 EFF-funded project working in collaboration with SDI, SSPO, SF&D & industry Targeting “high-end” food service sector in SE Asia Raising awareness of Scotland and Scottish seafood Will benefit Scottish companies already in the market & help further companies access opportunities 18

19. Launched at ESE 2012…… 19

20. Domestic market Regional sourcing opportunities –Morrisons – 1 May 2012 New processing facility in Humberside Committed to Scottish sourcing Requested support to increase supplies, develop marketing messages, handbooks for fish counter staff Keen this message is relayed to Scottish Government! 20

21. 21 Services Available Business development & marketing Value added programme Environmental advice & support Quality & technical advice Promotions & marketing Signposting Enquiry Service Seafood Scotland How can we help? Visit www.seafoodscotland.org or contact us onwww.seafoodscotland.org 01321 557 9344 for further information or specific enquiries.