Update for New Brunswick Oysters - John Sackton Seafood Datasearch Province of New Brunswick March 2021 - Government of New Brunswick
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Update for New Brunswick
Oysters
John Sackton
Seafood Datasearch
Province of New Brunswick
March 2021
1
•
Background
40+ Years in Seafood Industry
• Crab, shrimp, lobster and cod market
analyst since 1997
• Price and market outlooks for Atlantic
Canada, Alaska, and US West Coast
• 2005-2018 Price arbitrator for Alaska crab
• Expert on Mussel and Oyster Markets
• Co-Founder of NFI’s Global Seafood Market
Conference
• Annual Market Review for Fisheries Council
of Canada
• Founder of SeafoodNews and Seafood
Datasearch
2
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
200000
Ja
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F e ua r
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ay
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Prince Edward Island
A ly
Se ug
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m
J a be r
New Brunswick
PEI
nu
Fe a r
br y
ua
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ay
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Avg volume June-December
Oc ber
No tob
ve er
De mb
ce e r
m
J a be r
nu
Fe a r
br y
NB volume
ua
M ry
ar
ch
Ap
volume in 2020
ri l
M
ay
Ju
ne
Ju
A ly
PEI customs price
Se ug
pt us
em t
NB
Oc ber
No tob
ve er
De mb
ce e r
Oysters suffered big drop in
m
3
J a be r
nu
ar
y
NB customs Price
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
18.00
One Year into the Pandemic
What Have We Learned
• After a sharp drop in price and output in April and May,
most species recovered strongly in 2nd half of year.
• Major changes in food consumption patterns have
occurred in North America, China, and Europe.
• In the US the timing of relief checks plus the shutdowns
resulted in a surge in retail seafood
• This has led to higher overall seafood sales in 2020
than in 2019.
• Recovery in 2021 is predicted to be very strong
4
Oysters were hit harder by pandemic
than many other products
• Growth of farmed oysters came from
foodservice
• Because of need for shucking, could not
make transition to retail
• Little to no increase in retail customers
• So structural change in markets could not
be accomodated
5
Major Structural Changes in Trade
Patterns and Markets Will Persist
2019: Retail Seafood 50% 2020: 64%
US Seafood Sales 2019 vs 2020 2020
$9,000
$8,000
$7,000
$6,000
36%
$5,000
$4,000
$3,000
$2,000 64%
$1,000
$0
2019 2020
Retail Foodservice Retail Foodservice
6
US Seafood Sales Grew in 2020
7
Industry got pandemic reprieve
from retail seafood
IRI Weekly Retail Data: Seafood,
Meat, Deli Meat
100=no change YOY
180
170 Seafood
160
150
140
130 Meat
120
110 Deli Meat
100
20
20
20
0
0
0
0
0
0
0
0
0
/2
/2
/2
/2
/2
/2
/2
/2
/2
5/
2/
9/
14
21
28
12
19
26
16
23
30
7/
8/
8/
6/
6/
6/
7/
7/
7/
8/
8/
8/
deli Meat Meat Seafood
8
Frozen category very strong at retail
IRI Weekly Retail Data: Frozen,
General Food, Refrigerated
100=no change YOY
135
130
125
120
115
110
105
100
20
20
20
0
0
0
0
0
0
0
0
0
/2
/2
/2
/2
/2
/2
/2
/2
/2
5/
2/
9/
14
21
28
12
19
26
16
23
30
7/
8/
8/
6/
6/
6/
7/
7/
7/
8/
8/
8/
Frozen General Food Refrigerated
9
Frozen Seafood Had Better
Performance than Fresh
10Three trends helping seafood
consumption
• Big Increase in home
cooking
• Big increase in use of
frozen food
• Continued emphasis
on health during
pandemic
Data from informal survey of changes in seafood consumption
by SeafoodNews
11Pandemic has hit different
sectors unevenly
• 70% of US Seafood dollar sales
are at Foodservice
• Shut down of foodservice
sector has had huge impact
• But impact was initially
mitigated
• New round of shutdowns
means more closures will be
permanent
• Restaurant relief so far not a
government priority
12Oyster recovery will depend on
foodservice recovery
• Oyster consumption
driven by younger
people and oyster bars.
• They need to be in a
social setting again to
make oysters work.
• Pace of restaurant
recovery will be critical
to oyster farmers
13Casual Dining and Fine Dining
Restaurants Hit Harder
Source: Datassential Covid Tracker February 2021
14Take-out is not making up for
lost revenue
15Operators Expect Some Recovery
80% Seeing lower revenue, but 54% expect higher sales in six months
16Restaurant traffic has not yet recovered
Daily Change in Seated Restaurant Diners by Country
100
Jan-Feb 2021 Feb 2020 to dec 2020
50
0
1-Jan 1-Feb 1-Mar 1-Apr 1-May 1-Jun 1-Jul 1-Aug 1-Sep 1-Oct 1-Nov 1-Dec
-50
-100
-150
Canada US Germany UK Open table data
17March shows some recovery,
more in US than in Canada
US Diners Canadian Diners
-30%
-60%
Source: open table database
18Restaurant industry recovery
will be slow
• March data remains 40%
down in US, 60% in
Canada
• Changes don’t affect all
seafood equally
• Worst for oysters and
items that didn’t have
huge retail uptake
• Will add to overall
demand rather than shift
retail demand
19Economic factors are key
risk for first half of this Outlook for strong Canadian
year seafood export performance has
• US Gov’t and Economists and
Federal Reserve all agree on large improved
scale stimulus boosting debt to
WWII levels
• After the 2008-2009 financial
crash it consumers traded down to Ramped up vaccine distribution
lower value seafood. Prices took
years to recover. in the US may lead to strong
• Under current fiscal conditions, economic recovery visible by
stage is set for demand for
seafood to outstrip current summer
supplies
• Upward price pressure is likely
• This rosy forecast could be
upended by new virus variant
Increased seafood buying helped
outbreaks by maintenance of income levels.
Stimulus package may provide
income continuity
20Seafood met the moment in
2020
• 33% of US adults
bought seafood up
from 25% in 2019
• 44% bought seafood
online, up from 19%
in 2019
• Consumers want
more education + 30% cooking at home
about seafood
FMI power of seafood
21Oysters
• Oyster growers hit harder than other
sectors
• Unlike lobster and snow crab, oyster
price/volumes have not recovered after
plunging this spring.
• Export price levels maintained by drastic
cuts in volume
• US producers have seen a 50% price drop
22Oyster pricing is not changed,
but volume has collapsed
• YTD farmed oyster 700,000 $5.00
volume to the US is 600,000
$4.50
down 45% 500,000
$4.00
400,000
$3.50
300,000
$3.00
200,000
$2.50
100,000
0 $2.00
r
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Se gus
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to
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Ja
pt
2018 2019 2020 $/lb $/lb $/lb
230
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1/1/18
2/1/18
3/1/18
4/1/18
5/1/18
6/1/18
7/1/18
8/1/18
9/1/18
10/1/18
11/1/18
12/1/18
1/1/19
2/1/19
3/1/19
4/1/19
5/1/19
Canada
6/1/19
7/1/19
Mexico
8/1/19
9/1/19
10/1/19
11/1/19
Monthly Farmed Oyster Imports
12/1/19
1/1/20
2/1/20
3/1/20
4/1/20
5/1/20
6/1/20
to US, Mexico up 27%
7/1/20
8/1/20
9/1/20
10/1/20
11/1/20
24
12/1/20
Canadian shipments down 37%
1/1/21US Oyster Growers having
difficult time
• Massachusetts oyster farm sales down 50% from 2019; 43% from five year
average.
• Many oysters are being dumped because too large to sell
25Oyster support program pays
farmers to put oysters on reefs
• $2 million in funding from Pew and US
gov’t
• buy at least 5 million oysters to populate
27 acres of reefs
• more than 100 shellfish companies will
sell to the program,
• supports 200 jobs in New England, the
Mid-Atlantic, and Washington state.
26East coast industry is suffering
• Some farmers say business
down 75%
• Lack of restaurants is key
reason
• Also, can’t sell oysters
without license directly to
consumers due to health
issues
• Normal pricing is around $.60
per oyster
• Reef program is buying at
$.45
• Current market value is $.30
27Pandemic relief is supporting
farmers
• 76 growers
participated in • PPP program
forgivable loans
shucking project in
• USDA Crop Failure
Mass. Payments
• CARES Act, NOAA
fisheries relief
• Reef building
payments
28After rapid growth, East coast
farmed oyster supply stabilized
29Restaurant recovery could lead to
expanded sales fairly quickly
• Diners still have appetite for oysters
• Part of missed experiences
• Pricing is favorable, has not increased
• Oyster consumers in the demographic
most likely to resume restaurant and
social activities
30Outlook
• Larger companies are better at managing crisis
• Farmed production is more stable than wild
harvest
• A certain level of restaurant buying is
continuing, and NB producers are taking
advantage of that.
• Revitalizing restaurant sales of oysters will be
critical to recovery
31Time for Questions
• Please put questions
in chat and they will
be presented.
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