A period of rationalisation lies ahead for the fish processing industry because of white fish shortages, a new independent report by the Sea Fish Industry Authority revealed today.

The 2000 Survey of the UK Sea Fish Processing Industry reported that the combination of a shortage of fish, increasing requirements for investment to meet EU legislation and traditional cash flow problems would mean the inevitable closure of some fish processing units, particularly smaller, white fish businesses. However, larger and specialist fish processing firms with direct access to supplies and imports are more likely to survive the current downturn in supplies.

The survey analysed data on employment and industry structure for all fish processors in the UK and collected more in-depth information on primary and mixed processors (those carrying out a mix of primary and secondary processes). These two sectors alone generated an estimated £1.48 billion in annual sales from fish and fish products in 1999.

Seafish Industry Analyst Hazel Curtis, who carried out the survey, said:

"Overall employment in the industry is up since 1995 but the primary processing sector has declined. Average operating profits are getting tighter and this will trigger further rationalisation in the industry. Once the current rationalisation of the industry slows down, the remaining firms will probably be bigger and are more likely to be geared up for obtaining supplies via direct routes and from overseas. "Despite the difficulties facing white fish processors in particular, the survey identified that many business managers have already acted to restructure their operations with good results."

The report highlighted the following key points:

  • There has been a 25% reduction in the number of UK fish processing units since 1995 but the average size of operating units has increased. Total employment in the industry is up by 15% to 22,255 (full time equivalent posts). Employment in firms carrying out only primary processing has declined by 42% since 1995.
  • Grampian and Humberside remain the main centres for the industry - with 43% of all processing employment in the UK - but the historical trend of employment moving away from traditional port areas has continued. There has been a 5% decline in employment in Grampian and a 19% decline in Humberside.
  • UK landings declined by 31% from 1994 to 1999 and although imports increased by 15%, the net effect was a drop of 11% in readily available fish. The decline in landings has had particular impact on primary processors - traditionally reliant on readily available fish from local markets - but mixed processors are increasingly turning to direct contracts and direct imports.

The survey covered the whole of the UK industry and analysed data on supply, customer base, business issues and financial health for primary processing units and units carrying out a mix of primary and secondary processing. The survey included telephone interviews (carried out in May 2000), a postal survey, face-to-face interviews and analysis of published financial data. Seafish carried out a similar survey in 1995.

Robert Milne, Secretary of the Scottish Fish Merchants Federation and Processing Survey Steering Group member, said:

"The survey confirmed that the industry's major concern is the massive decline in landings and, as we anticipated, many primary processors were at break even point in 1999. Recent reports and business closures in 2000 show the seriousness of the situation is growing - it is indeed an industry in crisis."

"Seafish expended much effort in producing this report and I hope that those who can play a role in the future wellbeing of our sector will take it very seriously."

Martyn Boyers, Chairman of the Federation of British Port Wholesale Fish Merchants' Association and Processing Survey Steering Group member, added:

"This comprehensive survey by Seafish highlights the problems being faced by the industry in the UK. There are 135,000 people employed in fishing, processing and other onshore related industry and I hope the report will help the many struggling businesses gain wider support during the inevitable period of change ahead."

"I'm very pleased, however, to see that in spite of increasing burdens, the survey revealed many processors are using innovation and clever business thinking to adapt to the changes with good returns."

The report, priced £150, is available from Seafish Librarian Graeme Buck on 0131 558 3331, g_buck@seafish.co.uk. Companies who have participated in the survey will receive a free copy of the report and a 50% discount is being offered to other industry members who wish to purchase the survey. Highlights can be viewed on the Seafish website, www.seafish.co.uk.

Notes to editors

  1. Primary processing includes: cutting, filleting, picking, peeling, washing, chilling, packing, heading and gutting.
    Secondary processing includes: brining, smoking, cooking, freezing, canning, deboning, breading, battering, vacuum & controlled packaging, production of ready meals.
  2. The full Processing Survey Steering Group membership is as follows: Robert Milne, Secretary of the Scottish Fish Merchants Federation; Martyn Boyers, Chairman of the Federation of British Port Wholesale Fish Merchants' Association; and Mike Dunn, Dean of Portsmouth University Business School.
  3. Full copies of the report are available to media by post and a four-page summary is available by e-mail. For interviews and comment, contact Seafish (Jane Ferguson or Hazel Curtis) on 0131 558 3331, Robert Milne on 01224 897744, or Martyn Boyers on 01472 350022.