The Winding Glass

Melamine In Farmed Fish

We have just issued one of our few breaking news emails after a teleconference call with the USDA and FDA on contaminated fishmeal fed to farmed fish in the U.S. and Canada. The story is already going out on hundreds of media outlets.

There are two issues here: One is whether there is any health threat. The FDA says there is likely no threat, since the levels of melamine are going to be very low, and there is not yet any certainty whether fish fed this contaminated feed have entered the food supply.

But, we have all lived through food scares involving farmed fish that had huge market impacts-- i.e. the PCB scare in salmon a few years ago, that cut sales by 30% to 50% overnight.

We don't yet know the scope of this, since the FDA has not yet released, or may not release, the names of the fish farms where the contaminated feed was sold. But they are saying it went to a large number of fish farms in the U.S. and Canada.

The food scare is going to give aquaculture opponents another platform, and is something we all need to pay close attention to.

In a couple of hours, we should have a full transcript of the FDA/USDA conference call, and I will put up more information once we have it.

A J Fabre home, recovering

We have received word that AJ Fabre, the President of LSA who suffered a heart attack last week, is now home recovering, and his family is hopeful for a full recovery.

Here is a picture of AJ, taken by Frank Aymami for New Orleans City Business, back in 2001 before the tariff fight.

A lot of momentum to get FPI deal done

Despite the back and forth between Tom Rideout and Loyola Hearn, there is a lot of momentum to get the FPI deal done this week; it is doubful that the impasse between the federal government and the province will derail the deal.

There is too much riding on the success of the FPI sale for it to be compromised by government authorities-- which would devolve into a tremendous blame game as to who was at fault that could last for years with a lot of detriment to the current conservative party running Canada.

I got an email today from a person close to the situation who said that despite the theatrics, there was a lot of momentum to get the deal done.

Lobster prices falling, but warm water long term threat

Lobster prices are finally coming down with new supplies filling up the pipeline. Urner Barry quotes for live lobster dropped sharply at the end of last week, and the prospect is for a continuing weakening of prices back to more seasonally normal levels.

But the long term threat to lobsters may be warm water more than overfishing. Next Week the Atlantic States Marine Fisheries commission will try and deal with some lobster management issues. In Southern New England, the lobster landings and the number of traps and fishermen have declined precpitiously; and trap limits are now in place. At issue is the system to sell lobster trap permits, and the match between state and federal regulations.

But scientists are saying that warm water may be the biggest factor in catch declines-- when females molt in warm water they disorient, and sometimes cast off eggs before they are ripe. Also, divers report that in warm water, lobsters are lethargic, and don't try and enter traps.

The run up in prices this spring was a warning that this product is in a delicate supply situation-- there could be more shocks to come. We will try to address this in some future articles.

Louisiana about to tag Chinese Catfish

We have heard reports that Louisiana Commissioner of Agriculture and Forestry Bob Odom has been directing agents to halt sales on cases of Chinese catfish in Louisiana. We should expect an announcement from Louisiana soon joining the states of Mississippi, Alabama, Arkansas and Florida in testing and possibly taking actions against Chinese catfish.

A J Fabre, President of LSA Suffers Heart Attack

I would like to highlight a comment Karen Hopkins made this morning. She reports that "Mr. AJ Fabre, the President of LSA suffered a heart attack last night and is currently hospitalized in the critical care unit. He underwent an angiogram which opened up a stint to alleviate the blockage to his heart."

" The recent rigors of his advocacy for LSA and the conflicts with SSA have contributed to his illness.
Mr. Fabre has fought selflessly and tirelessly for many years to promote and protect our Louisiana shimping industry. He is one of the few people who actually "live and breathe" for his beliefs and to protect our culture and our way of life."

"We ask that everyone offer up prayers and support for Mr. Fabre and his family and friends during this difficult time."

"We here at LSA will continue to fight for what our organization believes in. Our members will unite and become even more active in our cause to aid and support Mr. Fabre's speedy recuperation."

I think all of us in the industry join the LSA in wishing AJ a speedy recovery. Many people in Louisiana have known each other for years, despite being on different sides of some issues. Yet, when a long-time advocate or leader in the seafood industry is stricken, all of us wish him well, and express our sympathies and concern to his family.

I for one want AJ's voice back on the phone, and in the thick of things. I hope he has a successful operation and a quick recovery.

What's the Greatest Threat to the Seafood Industry

Maybe reporters are always on the lookout for disasters. But a few of the things we have been consistently writing about have made me pose the question: What is the greatest threat to our industry?

Recently, things have been good. Demand is growing. Prices are strong. Many sellers have been having a profitable year. But two things have been nagging at me. One is the salmon situation in Chile. The continuing growth of the farmed salmon supply has seemed automatic: demand and supply both increase year after year, eventually making salmon as much a part of the Western diet as poultry. But then Chile, the real engine of salmon expansion, began having problems. Suddenly, forecasts were being cut back. Mortality was rising. Growth of fish was slowing. The slowdown has exposed some significant vulnerabilities to continued salmon growth. Fishmeal is scarce, expensive, and not likley to be able to meet continually rising demand. Substitutes lead to slower growth. Environmental problems are increasing: today we run an article on sea lice becoming more drug resistant. In BC, a new report will call for a move to closed containment systems. These systems work for boutique products - Barramundi for example is raised in closed systems. But whether they are economical for volume products is in doubt. If the movement to force closed containment is successful, salmon growth will have peaked.

The second doom and gloom scenario has to do with the Bering Sea. I will just point to a couple of past articles-- one today on starving grey whales, one a few weeks ago about growing acidity in the oceans, and the loss of much of the Bering Sea's productive plankton layer. We could be witnessing a change in the overall productivity of fisheries, which could have a huge impact on species such as pollock, cod, crab etc. This is a long enough post so I will return to the issue of the health of the Bering Sea later. But in the meantime-- what are your thoughts on the greatest threats facing our industry.

Melamine Contamination Scare may be more important than BSE

The new stories that will come out this week about the extent to which melamine contaminated feed made it into animals that are in the public food supply is going to have a lasting impact. I think this may be more of a big deal for consumers than BSE. Of course BSE is a real danger, where Melamine is not. But BSE has led to a very small number of deaths and it is a very long term and hard to trace disease. Further there are a lot of attempts to monitor and keep BSE out of the food supply.

But the melamine contamination has led to the deaths of thousands of pets. The FDA has catalogued over 8000 deaths, according to a news story we ran today. When consumers see their pets dying due to food contamination, and then read that the same contaminent made it into their own food supply-- it is scary, andit raises a major concern. I expect that this will lead to a decrease in consumption of any foods associated with the melamine contamination, despite the fact that no actual health risk exists. It will make people more reluctant to buy poultry, will focus more consumer concern on feed issues, and may have a bigger negative impact overall in the U.S. than the BSE issues, which have been extremely well handled.

High Seafood Prices Here to Stay

Looking at the number of seafood items that are priced higher than they were for the past few years, I am beginning to think we may be seeing a fundamental shift in the relative value of seafood. In other words-- these high prices are going to stick around.

Look at lobster, salmon, halibut, whitefish, crab, tuna, and pangasius sp. -- all are priced above where they were a couple of years ago, or are at the higher end of their 4-5 year price history. The only two exceptions (and they are important) are tilapia and white shrimp.

I have often argued that the general trend for lower aquaculture costs was the dominant factor in long term seafood pricing, and as a result, overall prices would tend lower. Seems to be true for tilapia and shrimp-- but not salmon at the moment.

Also, it certainly does not seem to have led to competitive price weakness in many other species. So what is going on?

In my view, we are seeing a major shift in perception of the value of seafood, especially wild seafood. This is likely based on health benefits, and the cachet that wild seafood has -- partly because the MSC and other ecolabels have begun to change the perception of wild fish from being overexploited to being sustainable.

This may mean that we are looking at a group of seafood commodities that have taken a leap upward in value-- and this may persist for a long time.

Seafood Import Workshop

Dick Gutting, former Exec. VP of National Fisheries Institute, and Mary Snyder, former head of FDA seafood labeling compliance, are giving a day long workshop for importers on U.S. regulatory requirements, at the Newark airport on May 9th. Last day to register is Monday, May 7th. For more info: visit this page.