Netherlands Seafood Annual Report 1995
AGR Number: NL5290

From: AgTheHague
To: USDA/FAS Washington D.C.
Country: NL
Year: 1995
Report Code: 54 Post Report Sequence Number: 003
Report Title: Seafood
Report Type: A - Annual Report
Report Subject: Seafood Annual Report 1995
Approved By: Steven D. Yoder
Drafted By: Tatiana Collaris
Security Classification: UNCLASSIFIED, NOT OFFICIAL USDA DATA
Date Due (MM/DD/YY): 09/18/95

Report Code: NL9554A
AGR Number: NL5290
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Seafood

Executive Summary

The total market for imported fish products for the year 1994 was revised and increased, from $ 730 million to $789 million, the U.S. export share of this was 5 percent in value. The most important categories were canned salmon and shrimp. With adequate and targeted marketing strategies, U.S. shipments of fish and fish products to the Netherlands are likely to expand in the coming years. The Netherlands serves a good conduit to neighboring countries for this product line. Our main competition in this market is from Norway in fresh, whole salmon and salmon products. The Netherlands is also an important exporter of fish and fish products.

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Seafood

General Summary

The Netherlands is one of the major fish suppliers in Europe. With imports of 789 million U.S. dollars and exports totaling 1,312 million U.S. dollars in 1994, the Netherlands ranks as a key European fish industry.

Dutch seafood production is primarily the result of wild harvest and can be divided into four main categories: cutter fishing, offshore fishing, shell fish fishing and fresh water fishing. Fish farming is still a small element in the fish industry but this sector has increased in recent years. The Dutch fishing fleet consists of 474 cutters, 12 freezer-trawlers and 150 dredgers. This is one of the smallest fishing fleets within the E.U. However, Dutch vessels are among the largest in Europe and are among the most advanced in the world.

The fact that the Dutch fleet has excess capacity, leads to serious problems between fishermen and government. Because landings increased dramatically in the early 80's, auction prices declined which resulted in a lower turnover figures in the fishing industry. To solve this problem, the Dutch government took the following decisions: 

• - subsidies for modernizing the fleet, which would decrease the number of old vessels;
• - limiting the days spent at sea;
• - quota set by the European Union.

However, Dutch fishermen failed to comply with these rules in the past, which resulted in fraud and manipulated production/trade figures. Today however, fishermen are organized in groups (so called "Biesheuvelgroeppen) which makes fraud more difficult. This grouping system, where there is a naturel social control, serves as an example for the European Commission.

The Dutch consume about 14.5 kilos of fish per capita (population: 15.4 million) per year, most of which is fresh. Most processing is done by retailers. 1994 was considered a good year for domestic sales; consumption is increasing compared to the consumption of meat. Traditionally the Dutch are consumers of cheap fish although the market for upscale fish products is increasing. U.S. exporters may also find a good market for value-added and ready-to-cook fish products.

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Seafood

General Summary

A further increase in consumption is expected as long as the price is reasonable in comparison with pork and poultry meat, which is still very popular in the Netherlands. Over the past years fish has been increasingly considered to be a healthier alternative to meat. Also, economic recovery in the Netherlands is expected to stimulate the sales of the higher priced species, such as salmon and lobster.

The Dutch consumer prefers white fish fillets if the price is reasonable . He prefers to buy this product at a regular supermarket. For consumption, a significant portion of the fish is coated with bread crumbs at point of sale or after purchase at home.

The best marketing strategies applied in the Netherlands are probably price incentives.

Since there is a large amount of intra E.U. trade, where border controls do not exist anymore, it is very difficult to obtain precise statistics on Dutch imports versus exports of fish and fishery products. A significant quantity of higher priced species enter Dutch borders but are re-exported which is not reported. Therefore, statistics do not present a clear picture and analysis must be based upon estimates and information collected from producers and traders.

Outlook

Over the next few years, fish consumption is expected to increase by about 3 percent annually, especially frozen and canned fish. Further market segmentation with the introduction of higher value-added products and the expansion of processed fish will be the driving forces.

As a result of reduced domestic landings, more frozen fish is expected to be imported. The Dutch trade also expects a further increase of Asian imports as long as they offer good quality and competitive prices.

American firms who wish to compete in the European-wide market for fish products should consider the benefits of entering this market through the Netherlands. More than half of the European Union's consumers live within a 100 mile radius of the world's largest port of Rotterdam, and the Dutch have a very efficient and highly developed distribution system.

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Seafood

PRODUCTION

- General

The Netherlands has always been a seafaring nation and this is reflected in the large size of the Dutch fishing fleet. Most important is flatfish (sole and plaice) which is a typical Dutch "niche". Due to over-fishing the Dutch fishermen worry about the future, because fish stocks have become more and more depleted over the last 5 years. Also important is fish processing. An estimated 400 companies process of flatfish and of molluscs. A lot of processing is still done by hand which gives this industry a "crafty" image: this can be used as a marketing feature.

There are also many companies that only process fish and other seafood. For example, they import their shrimps from Denmark, peel them and export them to Belgium.

- Aquaculture Harvest/ Wild Catch Production

Factors

The Dutch fleet operates in coastal and distant waters. Distant water fisheries takes place in the North Sea and the Atlantic Ocean. The cutter fleet is a modern fleet mainly consisting of large vessels.

Fishing and mussel fleet: number of vessels, engine power and employment:

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Seafood

PRODUCTION

- Aquaculture Harvest/ Wild Catch Production

The capacity of the Dutch fleet is bigger than necessary to catch the allotted quota of fish. Sole and plaice are important products for the big cutters. The medium size cutters fish for cod, sole, plaice and herring and the smaller ones for shrimp and in many cases often alternately for species already mentioned. In 1994 the total catch amounted to an estimated 465 million U.S. dollars. On the basis of the good results, the fishing fleet was substantially expanded in the 70's and early 80's. However, as a result of the restrictive measures and the reorganization policy of the E.U. with respect to fisheries, the fishing fleet has been reduced in the past few years (712 vessels in 1986 to 560 vessels in 1993).

The quantity of landing is influenced by Total Allowable Catches (TAC) set by the E.U. (see resource management policies). TAC's are set on a European level, while quota's are set on a national level. Political factors influencing the quota in the Netherlands are, according to the Minister of Agriculture and Fisheries, Mr. J. van Aartsen, "...find an a balance between economical and ecological factors. Whereby fishermen have a stable income and with respect to fishery stocks."

Not only quota, but also a limited period of fishing (so called "sea days"), and a maximum capacity of 2000 hp engine power should contribute to a more profitable climate in the fishing sector.

Research (Federal Institute of Fishery Research - RIVO) over the last years showed remarkable results:"In 1990 researchers showed that a cleaner water environment had a negative influence on the fish population. The E.U. set rules to improve the quality of waters in Europe to ensure that spawning stocks would not fall below a biological sustainable level, the so-called safe biological level. However,  research proved that phosphates had a positive influence onfish populations. A dramatic decrease of landings of pelagic fish has been registered since 1985."

Source: Ministry of Agriculture, Nature Management and Fisheries.

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Seafood

PRODUCTION

- Aquaculture Harvest/ Wild Catch Production

Aquaculture in 1993 (based on latest estimates by the Min. of Agriculture)

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Seafood

PRODUCTION

- Production Mix

- Production Technology

One of the cornerstones of the Dutch fishing industry is the flatfish processing which has grown strongly over the past twenty years. The processing companies have very modern equipment. However, the fact that the filleting itself is done by hand is remarkable and has given the Dutch filleting industry world-wide fame. The capacity of this industry is very large and can process more than ten tons daily.

The production process of canned fish is characterized by a certain degree of automation and large-scale competitive production. Firms operating in the high quality range produce fish in tins and glass containers (for the Netherlands "Kennemerland b.v." is the largest processing company). The introduction of easy-open aluminum tins is a recent innovation.

The deep-freezing process has been transformed by the innovation of cooling techniques.

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Seafood

PRODUCTION

- Production Quality

Dutch seafood has a very good reputation for quality. Freshness, taste, origin, season, health aspects etc. determine the quality of fish and fishery products. Laws and regulations applicable when handling, processing and trading fish and shellfish control quality standards. As of December 15 1995, E.C. directive 93/43/EEG, concerning Food Hygiene will come into effect, which will require aquality control system (HACCP, Hazard Analysis Critical Control Points) for all processing companies. On the national level, the Dutch Food Inspection Service is responsible for quality inspections.

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Seafood

PRODUCTION

- Cross Commodity Developments

Following the increased North American canned salmon prices resulting from the extremely low pink harvest, Dutch importers turned to Asian producers. The Dutch consumer is very price conscious. Therefore consumers are influenced more by lower prices than higher quality.

In addition to competition from alternative suppliers, canned salmon also faces competition from canned tuna.

- Cumulative Production Issues/Sub-Aggregate

Production Issues

Besides canned salmon, smoked salmon is another important product in the Netherlands. With peaks around Christmas and New Year, the Dutch imported 99 MT in 1994. Smoked salmon is mainly imported from the U.K., Norway and Denmark as little smoked salmon production occurs in the Netherlands.

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Seafood

CONSUMPTION

General Overview

Over the next few years, fish consumption is expected to increase by about 3 percent annually, especially frozen and canned fish. Further market segmentation with the introduction of higher value added products and the expansion of processed fish will be the driving forces.

Due to changes in lifestyle, the Dutch consumer is increasing the consumption of already prepared meals. This is true for the seafood as well as for the red meats and poultry product groups. The majority of prepared meals are frozen or preserved, given the perishability of fish and meat in general.

- Utilization Patterns

The annual per capita fish consumption is about 14.5 kilos, with raw herring accounting for 30 percent of the total fish consumption. Also fried fish is very popular. In the last few years, the Dutch consumer has shown some reluctance to buy fish due to various fish scandals and pollution of the North Sea. 1994 however, was a good year for the Dutch fish industry, as sales rose by 8 percent over levels in 1993.

The consumption of fresh fish can be divided in four major categories:

During the period 1988-1994 consumption of fish rose by 20 percent. (Source: EIM Voedselconsumptiepeiling)

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Seafood

CONSUMPTION

- Utilization Patterns
Due to the improvement of distribution systems and packaging, processed fish still presents strong competition for fresh fish. The demand for frozen fish is increasing in almost every EU country thanks to the development of "convenience" preparations and packaging which increase a product's storage period. The evolution of production technologies and a less than proportional increase in fresh fish services also has a significant effect on demand.

About two-third of total fish turnover comes from fish products that need no further preparation.

The consumption of canned fish has been increasing in recent years. This increase in sales is due mainly to marketing efforts by the leading firms, which adopted product differentiation policies through the introduction of both high quality products and new products such as mixed fish salads. Important for the increase of fish sales, in general, is the wider range of imported and cultivated fish and fishery products now available to the consumer.

Salmon and lobster are highly seasonal products, with consumer demand peaking at Christmas and Easter. The market for canned salmon in the Netherlands is extremely price elastic with consumers purchasing greater quantities at lower price points and with little regard to quality or country of origin. In addition, Dutch consumers do not perceive canned salmon to be a status-symbol product and appear to purchase it in an unplanned fashion and in response to in-store stimuli such as price discounts.

Consumer profiles of Dutch canned salmon consumers include housewives aged 45+ and especially within the 55-64 years range. Canned salmon is regarded as a product suitable for uses in traditional ways and is used in salads, sandwiches and as a snack. Canned product is seldom used as a main course dish, as it competes with the abundance of Norwegian, Scottish and Irish farmed salmon and other fresh seafood.

Consumers of fresh and frozen salmon differ from consumers of canned salmon. They tend to be younger, more discerning and fall within a higher social class. Both fresh and frozen salmon are likely to be eaten in meals outside home, especially within restaurants and catering venues.

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Seafood

CONSUMPTION

- Utilization Patterns
Fresh lobster is mainly consumed in restaurants and is still seen as a very exclusive product due to the high price (ranging from U.S.$ 12 to 24 per pound, depending on season and availability)

The table below gives an impression of the Dutch per capita consumption of fish and meat, compared with the American consumption in 1990-1993

About 30 percent of the total consumption of fish takes place at a hotel or restaurant. The importance of caterers is increasing over the years. Consumers take their lunch more often at a company restaurant. The consumption of the typical Dutch "Maatjesharing" (salted herring) is most of the times consumed at the point of sale. Consumptive expenditures on fresh fish are estimated at $ 54,4 million in 1994.

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Seafood

CONSUMPTION

- Substitution Patterns
Increased recognition of fish as a healthier alternative to meat has attracted more consumers over the last years. 

Consumption of beef and veal in the Netherlands shows a decreasing trend. Frequent press reports on the illegal use of hormones have had a negative impact on the quality image of beef and therefore on the consumption of beef. Generally, prices of both pork and poultry are more attractive to the consumer than beef prices.

Pork continues to be the most popular type of meat consumed in the Netherlands. However, the relative share of pork in total meat consumption decreased because of competition of lower beef prices.

Following the increased North American canned salmon prices resulting from low pink harvest, Dutch importers turned to Asian producers.

Such products will undoubtly find favor with Dutch retailers who sell primarily on the basis of low prices. In addition to competition from alternative suppliers, canned salmon also faces competition from canned tuna. Canned tuna is perceived as a versatile and modern product that lends itself to a wide variety of uses that can also be used like salmon, in salads, for sandwiches and as a snack. If prices of canned salmon increase, importers will turn to canned tuna.

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Seafood

CONSUMPTION

- Substitution Patterns
Also over-fishing of certain species lead to increasing prices and substitution by other, cheaper, species. Most important is cod, which is often substituted by Alaska Pollack, especially when fried.

The most important fish for the Netherlands is the flatfish like sole and plaice. The "niche" the Dutch have in this market is also under pressure due to a decreasing stock (catchment declined from 84 MT in '89 to 49 MT in 1993).

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Seafood

TRADE

- Trade Trends
Imports of fresh and frozen salmon into the Netherlands in 1994 totaled 4,799 MT of which 621 MT was frozen product. Norway continues to be the Netherlands' largest supplier within both the fresh and frozen sectors. While a very small volume of frozen Alaska salmon is used for steaks, fillets, and whole fish destined for the consumer, the majority of frozen Alaska salmon imported into the Netherlands is smoked within the reprocessing industry. The decline in the use of frozen Alaska salmon in the steak/fillet industry is due to the very large quantities of salmon currently available from alternative suppliers.

The substantial increase in the volume of Alaska canned and fresh/frozen salmon exports to the Netherlands is not reflected in  the market share percentages. In 1994, for canned salmon, the U.S. had a market share of 29.5 percent. Canadian exports increased substantially from 1,364 MT in 1993 to 2,224 MT in 1994 and gained herewith a market share of 43 percent. According to Alaska Salmon Marketing Institute however, considerable amounts of Canadian salmon exports originate in the United States, which could explain their high export figure. Exports from Asian countries are still expanding and Malaysia, Korea, Singapore, and Thailand captured an estimated 13 percent of the Dutch market share.

Seventy-five percent of the imported Homarus (Live) comes from Canada (678 MT in 1994) as they are traditionally seen as the "lobster-country". Estimated is that 65 percent is re-exported to Belgium.

American firms who wish to compete in the European-wide market for fish products should consider the benefits of entering this market through the Netherlands. More than half of the European Union's consumers live within a 100 mile radius of the world's largest port of Rotterdam, and the Dutch have a very advanced and developed distribution system. For example, the Dutch handle approximately 30 percent of all trucking and control nearly 60 percent of all inland water transportation. Amsterdam's Schiphol Airport, through which most of the fish is shipped, is the third largest cargo terminal in Europe and will double its cargo capacity through the year 2000.

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AGR Number: NL5290
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Seafood

TRADE

- Trade Trends
Outlook
The open European borders and the changing eating habits are, among other factors a good change for the Dutch fishing trade. Due to hormone scandals in the meat industry, more and more, European consumers turn to fish. Therefore a sales increase is expected for the next five years, especially within the prepackaged and prepared seafood market. 

- Factors Affecting U.S. Trade 
Third country competition is one of the major factors affecting U.S. trade to the Netherlands. Asia has the advantage of low labor costs in the processing industry, which affects the import prices of canned salmon and tuna. Currently almost 50% of canned salmon comes from the U.S. and Canada. However, since canned seafood is a price sensitive product in the Dutch market, and the quality is of lesser importance because it will be used in dishes, consumers are buying more and more Asian brands.

Norway has the advantage of being close to the EU markets. The low transportation costs and retail prices, due to overproduction of Norwegian salmon makes it very difficult for U.S. exporters to sell their fresh salmon to Dutch importers. U.S. frozen salmon, however, has a price advantage compared to Norwegian salmon and is therefore very popular in the Netherlands, with imports of 298 MT in 1994.

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Seafood

TRADE

- Trade Matrix
The Netherlands holds the leading position as the largest importer and exporter of seafood in Europe. American fish product suppliers who wish to compete in the European fish market should recognize that exporting through the Netherlands is one of the most efficient and productive means of accessing the European market of 729 Million consumers ( E.U. plus Non-E.U. countries).

The combination of outstanding transportation and distribution systems, as well as the fact that the Dutch have the largest fresh and deep frozen fish supply harbor in Europe at Rotterdam port, makes the Netherlands the headquarters for the European fish market. Fish shipments leave nearby Schiphol Airport in Amsterdam, the major European transshipment location, on a daily basis for destinations throughout Europe.

In 1994, the Netherlands imported an estimated $ 789 million in fish products, 80 percent of which came from other European Countries, mainly Norway, Germany, Denmark, the U.K. and Belgium. About 5 percent was imported from the United States. The Dutch exported also about $ 1,312 million in fish products in 1994, an increase over 1993, when it exported $1,260 million of fish (+ 4 percent). Seafood accounts for about 4 percent of the total agricultural exports.

The trade matrices below will give an impression on how the Dutch trade relations are with Europe and the United States for the different seafood groupings. Largest Dutch imports from the U.S. are "Preparations of Fish". Dutch exports to the U.S. however are to be disregarded.

NOTE: due to the elimination of EU intra-border controls, intra-EU trade statistics are no longer registered through customs declarations. The Dutch Central Bureau of Statistics (CBS) now depends on direct reports from importers and exporters on intra-EU movement of goods. Companies with a relative small trade volume are exempt from this trade reporting requirement. However the response of importers and exporters has been such, that intra-EU trade statistics are incomplete. The reporting system of trade with non-EU countries has not changed and continues to be reliable.
Source: CBS / LEI

Report Code: NL9554A
AGR Number: NL5290
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Seafood

TRADE

- Trade Matrix