What’s my fish worth?

I remember a conversation I had with my Uncle Eddie back in the late 80’s when I was a relative greenhorn in the business.  I’d had 3 or 4 years of buying experience under my belt and thought that I had a pretty good idea what this business was about.  Ecuador was king when it came to Shrimp, and shell-on was the only way to go.  The import cost of 50/60 count shrimp had just plummeted from 3.20/lb down to the unheard of price of 2.80/lb!  I tried to make the argument with Ed to take whatever capital we had and buy as many 50/60’s as we could lay our hands on because the item had gotten so cheap that it was selling below the base intrinsic value for the Shrimp.  Ed was very quick to point out to me that there is NO intrinsic value in Seafood.  Your fish is only worth what your customer is willing to pay you for it.

20 years later Ed’s words hold up better than ever.  Those 50/60’s that I would have felt safe selling at 2.95/lb are now worth 2.60/lb or less, and that size is one of the least affected by the deflation in the value of Shrimp.  Most sizes of Black Tiger Shrimp are at prices in the low end of the 10 year trading range.  Domestic Shrimp has taken a bigger hit, as it is now considered to be less valuable in the market than tigers, a total reversal in attitude!  Domestic Shrimp are selling at prices lower than they were in 1985, and that’s not taking into account the erosion in the value of a dollar.  In real terms the shrimp is selling for less than half what it did back then!

Let’s not limit our discussion to the value of Shrimp.  You can find similar examples with other species including Snow Crab, Warm and Cold water Lobster tails and meat, fresh Swordfish, and dozens of other products, all of which are trading at or below the prices that they’ve sold at any time during the last 20 years.  At the same point we have other items where prices are zooming.  Farmed Salmon fillets were worth 4.10/lb on average in September 2007.  They’re selling for 5.50-5.75/lb now.  Scallops are selling at or slightly ahead of the prices that they were at last year.  Frozen Swordfish prices have jumped about 20% in the last 2-3 months.  The general trend at the moment is deflationary, but there are items that are bucking the trend.

What’s the answer to the question up top?  Your fish is worth what your customer will pay for it AT THE MOMENT WHEN IT IS NEEDED.  If you’re a speculator in stocks or precious metals you may want to speculate in seafood as well.  This is perfectly fine as long as you follow basic rules.  Don’t invest before you research the market.  Be careful buying commodities that are not openly traded, where it is more difficult to establish a current market price.  Be realistic about whether you can sell your purchase when it comes time to liquidate- don’t buy more than you can move in a reasonable timeframe.  Don’t gamble what you can’t afford to lose. Finally, don’t forget- fish is not gold or even wine- it doesn’t get better with age!

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Welcome!

 This is your place to learn about a wide variety of fresh and frozen seafood.  Posts will cover a variety of topics.  Expect to see focus features on individual species of fish such as Cod or Pollock.  You’ll also see articles comparing different species of Shrimp, Crab, or Lobster.  Some posts will have pictures of fish and will teach you how to handle and prepare them.  Other posts will focus on the seafood commodity markets, helping you to anticipate rises and falls.  We’ll explain the different species of wild Salmon, the different countries of origin for farmed Salmon, and how to choose which to use.  Additionally we will have a recipe section with our favorite seafood recipes and a glossary of fish terms that may stump you.  The seafood experts who will be contributing to this website have an average of 20 years of experience.  In general, our focus is on posting and publishing articles, as such we will be moderated and are not likely to post many responses.  We will review your responses however, and will do our best to reply to you off-line.  Feel free to email us with suggestions for future posts as well.  Again, this website is for you.  Thank you for your attention, and welcome to seafoodexperts.net!

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Looking For Value

The food landscape - always a fluid environment, has seen some dramatic shifts over the past 12 months. With consumers reducing their dining out dollars and increasing the number of meals consumed in the home, competition has become most intense in the past few months to provide value to retail consumers trying to stretch their purchasing power. This is great news from a retailer’s perspective as it drives more consumers into the store and many retailers are seeing comp sales increases as high as 5% over last year. But what are they going to buy? Convenience-as the economy has slid into recession, people are working harder. Taking on more responsibility and working more hours as they are asked to do more with less. They have little or no time to plan much less execute on a meal. So they are looking for products that they know how to cook or products that they feel they cook quickly and successfully. Quality-for those consumers that are trading in their frequent diner card for a frequent shopper card, they are coming into the store looking for products that will replace that restaurant experience. That means that they are looking for quality products in terms of freshness, taste and appearance. Value- Consumers are watching their expenditures. Savings rates have increased for the first time in decades and everyone is trying to do more with less. Does this mean that they are looking for the cheapest product on the shelf? Not necessarily. What they are looking for is a solid value. Products that are aggressively priced and meet their need for quality and convenience at the same time.

Unfortunately, seafood has not fared as well as we all would like in this competition. In the last three quarters of 08′, seafood was the only perishables department that did not see an increase in sales and tonnage. As customers have defined their purchasing decisions they have found that other proteins, in particular poultry, which saw a 6.7% increase in sales in 2008, have met their needs more effectively. It does not have to be this way. There are a large number of products that can be offered at a great value.  Products like Capensis, Swai and Ponga, to name a few, all offer wholesale price points in the mid $2.00 range which would allow a retailer to market these products for as little as $3.99 per pound on sale. Although it may take some innovative marketing to introduce consumers to these species, given the competitive environment I think it will be well worth the effort.

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