Though U.S. consumption is well below other proteins today, seafood will likely be an increasingly important part of the American diet in the years to come. The country’s population is predicted to grow by 89 million between 2010 and 2050 to 401 million people. More people require more food—and land limitations mean the beef, pork, and poultry industries can only produce so much volume.
Increased domestic consumption will have a direct impact on restaurant operators who serve finfish and shellfish. On one hand, more Americans eating seafood means the potential for increased sales. On the other, it also means the potential for higher wholesale prices. And while space limitations largely don’t affect the seafood industry, it has its own challenges to contend with, especially in the U.S.
For starters, more than 90 percent of the seafood the U.S. consumes is imported from countries with their own growing demand for protein. China, the global seafood producer and processor leader, is experiencing a rise in its middle class. China used to be a net exporter of seafood, but now it’s a net importer. The same is true of other seafood-producing countries in Asia and South America.
“If I am a buyer of seafood,” says Sebastian Belle, executive director of the Maine Aquaculture Association (MAA), “global demand is going to make it harder for me to source.”
In addition, climate changes are forcing suppliers to reevaluate their sourcing practices and invest in new practices, like aquaculture. These challenges have all levels of seafood stakeholders looking at new ways to approach the present—and future—state of the seafood industry.
Today’s commercial seafood supply
A variety of factors and stakeholders—developers, fisheries, non-government and government organizations, and aquaculture—hold sway over the U.S. seafood supply. Coastal and marine commercial fishing contributes $70 billion each year to the U.S. economy.
Alaskan Pollock is the No. 1 fished seafood in the U.S. Two billion pounds of it are caught each year. But that might not be the case for very long. Alaskan Pollock comes from the Bering Sea, which has recently seen significant fluctuations in water temperature. The plankton Pollock rely on as their food source are sensitive to such changes; warmer water makes plankton a less efficient energy source for the fish, as they produce fewer fats and lipids.
A National Oceanic and Atmospheric Administration (NOAA) study of the warming in the early 2000s found that two years of consistently warm waters negatively affected stocks of Walleyed Pollock. Younger fish saw a 40 percent decline in biomass and catch numbers declined by 40 percent over a three- to four-year period. Pollock stocks recovered as water temperatures dropped, but modeling efforts suggest 40 years from now incidences like that will be more common.
“It doesn’t look like Pollock is going to do well in the future,” says Dr. Ed Farley, program manager for the Ecosystem Monitoring and Assessment (EMA) Program at the Alaska Fisheries Science Center. “But other fish will take its place.”
Long John Silver’s is already planning for that day, says Marie Zhang, chief food innovation officer and senior vice president of menu innovation, supply chain, food safety, and quality at the chain.
“Limited Alaskan Pollock might increase prices, which in turn might hurt our franchisee margins,” Zhang says. “We know we might have to seek alternative supplies … and look at other sustainable proteins.”
Climate change and seafood
Whether they consider it speculative or gospel, stakeholders in the U.S. seafood supply are paying attention to the research around climate changes and their impact on fish. At the center of the conversation is the 2014 “Climate Changes: Implications for the Fisheries and Aquaculture” briefing jointly published by the University of Cambridge and the Sustainable Fisheries Partnership (SFP). The report stated that the global seafood industry is under threat from climate change and ocean acidification.
Researchers outlined the following: Earth’s atmosphere and oceans are warming due to carbon dioxide emissions. Weather patterns and sea levels are rising as a result. Global average temperatures will climb 2.6–4.8 C and sea levels will rise 0.45–0.82 meters by the end of the century if warming continues at its current rate. The negative impact on seafood on a global scale includes displacement of stock and a decline in shellfish due to acidic water. Catches might decrease 40–60 percent. Other factors—overfishing, habitat loss, and pollution—will worsen the situation. Coral reefs are already at risk in some regions.
The potential financial hit to the seafood industry, the report goes on, is $17–$47 billion by 2050. East Asia and Pacific markets are especially vulnerable, but so are U.S. supplies. Acidity in the Gulf of Mexico, for example, is projected to increase at two times the global rate. Adapting to these changes will require the reduction of non-climate-related stressors, such as pollution and habitat destruction; an increase in aquaculture production; and the adoption of new management policies—adjustments that would cost an estimated $30 billion a year for the next 35 years.
Cambridge and SFP did find some silver linings to these climate changes, including faster growth rates and food-conversion efficiency, longer growing seasons, range expansion for some species, and new growing areas as ice cover decreases.
The “Climate Changes” report states that reducing carbon dioxide emissions will save seafood. But those close to the domestic seafood supply are not so dire in their assessment of what needs to change.
“It’s important to understand we don’t have all the answers,” NOAA’s Farley says. “People need to understand that carbon dioxide is being absorbed into the ocean and will impact the food supply [of some] fish. It’s not doomsday. It’s a shift in the way we’re catching and eating. Forty to 50 years from now, restaurant operators might be serving something different.”
What sounds simple in theory can be a complex and costly undertaking for large seafood chains and time-intensive for smaller owner/operators with no direct ties to fresh or coastal waters. Those linked to the water have been adjusting to the ocean’s changes for generations.
“Climate change is real and is going to affect the seafood business,” says Luke Holden, president of Luke’s Lobster, a 13-unit fast-casual chain with locations in New York City and the Washington, D.C., metro area. Holden is the son of a Maine lobsterman and supplies his stores with wild-caught shrimp, crab, and lobster direct from Cape Seafood, his own seafood processing and distributing company based in Saco, Maine.
“There’s been a lot of climate variance the past five years,” Holden says. “There’s less predictability around when volume is going to be heavy, which makes it more difficult to manage the business. I don’t see climate change devastating any of the species populations we work with in the long-term, but it can impact our food costs.”
The business model behind Luke’s Lobster and Cape Seafood is set up to absorb such price fluctuations. Staying informed is a key part of that, Holden says.
But knowledge also has its costs, says James Walker, a 20-year foodservice veteran who sits on the board of seafood fast casual Boneheads. Walker says he’s relying more heavily than in years past on third-party information resources to forecast and keep food costs down.
“What’s going on with the ocean changes what we buy and how we buy,” Walker says. “We use a mix of proteins from different sources … [both] frozen and fresh. The goal is to put Boneheads in position to be prepared for any changes. The investment is thousands of dollars, something we wouldn’t have done years ago.”
The call for seafood sustainability
Part of what Walker and operators like Andrew Gruel of the fast casual Slapfish are paying for is the ability to trace and track how, where, and when their seafood left the water. Sustainable seafood is a popular term inside and out of the industry. NOAA defines it as “catching or farming seafood responsibly, with consideration for the long-term health of the environment and the livelihoods of the people that depend upon the environment.”
“I’ve never had anyone come up and ask me about the sustainability of my chicken,” Walker says. “But, especially in the past 10 years, guests are asking where did the seafood come from, where was it sourced.”
That guest is responding to concentrated marketing efforts by environmental groups to raise awareness about harmful environmental impacts associated with some types of commercial fishing. And that is a good thing, says Gruel, who is co-owner and chef at Slapfish. Sourcing sustainably is at the heart of Slapfish’s seven-unit operations. The fast-casual chain partnered with the Aquarium of the Pacific to develop and maintain a sustainable sourcing plan. Scientists and experts from the aquarium’s sustainable seafood program, “Seafood for the Future,” regularly review the Slapfish menu. Gruel also relies on a variety of seafood guides, eco-labels, and FishWatch, maintained by NOAA Fisheries to help him make environmentally sound decisions when purchasing.
“It’s our duty to become students,” Gruel says. “This goes beyond seafood. It’s up to us as operators to foresee the major environmental changes that might result from our sourcing decisions.”
Product quality is the first thing Long John’s Silver’s considers when sourcing seafood for its 1,100 restaurants. Second is sustainability. All wild-caught seafood served at the chain is sustainably certified. The South American shrimp it uses is raised according to Best Aquaculture Practices (BAP) standards that address environmental and social responsibility, animal welfare, food safety, and traceability and is processed in facilities certified by the international Aquaculture Certification Council Inc.
“We’ve found that sustainability is very important to the Long John Silver’s customers, especially the younger generation,” Zhang says. “And that demand for sustainable seafood is why we are involved in the process of increasing our domestic aquaculture industry.”
A domestically farmed seafood future?
Long John Silver’s support of domestic seafood aquaculture is part of its three-pronged approach to increase U.S. seafood consumption. The plan calls for the foodservice industry, processors, and the scientific community to come together to introduce seafood as a staple of the American diet as early as kindergarten; develop products that make it easier for American cooks to prepare and serve healthy seafood options; and expand domestic aquaculture.
“The rest of the world has done a great job with agriculture seafood,” Zhang says. “We source sustainable agriculture seafood from farms in India, China, Indonesia, Peru, and Ecuador. But as the demand for protein increases on a global scale, the only solution is seafood, more specifically agriculture seafood.”
Half of the seafood the world consumes is bred, reared, and harvested as part of an aquaculture operation. The industry is valued at $120 billion on a global level. Asia produces 88 percent of all production. Only 10 percent of the global industry is made up of large-scale commercial operations. The majority are small family farms.
In the U.S., the $1.3 billion seafood agriculture industry accounts for less than 1 percent of global aquaculture, according to the most recent statistics from the Food and Agriculture Organization of the United Nations. Its growth is slowest among producing nations. The U.S. is the No. 3 global seafood market, but domestic aquaculture operations produce less than 2.5 percent of the seafood consumed in the U.S.; domestic supplies of wild-caught fish account for just 5 percent. As of 2011, the nation’s annual seafood trade deficit is $11.2 billion, though the U.S. exports technology, feed, and equipment to other markets.
“If China keeps growing its seafood demand, we’re going to either need to get serious about growing domestic aquaculture or we’re not going to eat seafood here,” says Steven Hart, executive director of the Soy Aquaculture Alliance, one of the Coalition of U.S. Seafood Producers (CUSP) founding organizations.
U.S. seafood agriculture growth presents a host of challenges: operational capacity of existing operations; higher operational costs than foreign competitors; investor unfamiliarity and wariness; and the lack of a comprehensive national plan for growth.
To address the latter, CUSP is pushing for the adoption of the NOAA Fisheries Gulf Aquaculture Plan, which would allow up to 20 offshore aquaculture operations to be permitted in federal waters of the Gulf over a 10-year period. The belief is once the plan for environmentally sound and economically sustainable aquaculture in the Gulf of Mexico is implanted and proven sound, investors will come.
“Right now, domestic aquaculture is not an attractive business investment,” Hart says. “Investors consider it risky because it’s not well understood.”
Yet the industry has been around since the mid-1950s and has grown to produce 2 million tons of seafood each year. U.S. freshwater agriculture grows catfish, trout, tilapia, and bass. Marine operations grow bivalves, salmon, cod, moi, and yellow tail, among other fish. Neither segment is growing enough to satisfy the predicted increase in U.S. seafood demand, but there are success stories.
Take Maine as an example. Seafood is the state’s No. 2 crop thanks to the strength of its aquaculture industry. Maine was one of the first states to develop a licensing program for aquaculture. In 1994, its seafood farmers became the first in the world to adopt best management practices and a certification process.
“We recognized aquaculture as a way to diversify and make use of coastal waterfronts,” says Belle of the Maine Aquaculture Association, the oldest state aquaculture trade association in the country. “Our members are the sons and daughters of commercial fishermen who wanted to continue living on the water and their families’ maritime heritage.”
Maine’s aquaculture industry has seen 8–10 percent growth in sales and revenue each year for the past 10 years. Its 180 seafood farms grow shellfish, finfish, and sea vegetables and employ more than 650 people. Growth in new farms is at 5–8 percent each year.
“The domestic market is very strong and will take everything we produce,” Belle says. “The demand outweighs the volume.”
Maine seafood is considered premium. Wholesale prices for seafood farmed there are up to 20 percent higher than other fish. The price reflects product quality, Belle says.
“Our seafood can reach 150 million American consumers within a 20-hour truck drive. Our fish has a longer shelf life due to the shipping time and the cold temperature of our water. An operator can save 10–15 percent in food costs with spoilage savings.”
Domestic aquaculture advocates say more success stories like Maine’s are needed to change U.S. consumer and investor perception of seafood agriculture.
“The industry must do a better job educating consumers on what aquaculture is all about,” says Steven Hedlund, communications manager at the Global Aquaculture Alliance. “People don’t understand how environmentally friendly aquaculture can be. There is this perception that wild-caught product offers better product quality and freshness. That’s just not true.”
In fact, what regulation there is around U.S. aquaculture is among the strictest in the world, second only to the European Union. U.S. rules and regulation require quality assurance, sustainability, and food safety reporting.
“As a farmer you become an environmentalist because you see the impact on your production,” Belle says. “It’s in our national interest to develop a healthy, productive aquaculture industry.”
True federal support is needed to make that happen, advocates say. Insurance programs. Grants. Subsidized marketing programs.
All that is coming, Long John Silver’s Zhang says. “People speed things up when they don’t have a choice.”