Spain: Where's the Seafood?

U.S. exporters planning to enter this traditional European marketplace for seafood need to be aware of two primary market forces: Spain is curtailing its domestic catch and the value of the dollar profoundly affects exporters' competitive edge.

Seafood is a dietary mainstay for a populace with a long seafaring tradition. Spanish cooks prepare 1.7 million tons of seafood a year, ensuring Spain's top seafood consumer status in the European Union, following only Japan worldwide. Per capita consumption in Spain weighs in at an impressive 42.6 kilograms, compared to 6.7 in the United States in 1996.

Frozen products currently make up just over half of this consumption; the preferred but pricier fresh fish follows with a 32-percent share, and mollusks and crustaceans with 30 percent.

Spain's total catch has been declining since 1987 because of lower fish stocks that led to limits on catches in international waters. Agreements with Morocco and Mauritania and Spain's full integration into the European Union (EU) Common Fisheries Policy will continue to curtail raw fish and seafood availability.

Temporary, immediate effects of this lower output have been a marginal drop in total consumption and slightly higher prices. However, an upturn in imports is expected to fill in the domestic shortfall and, as a bonus for exporters, create a market for new processed seafood products. Overall consumption of seafood is likely to increase through 1998.

Despite a strengthening dollar (150 pesetas ' $1 in October 1997), Spain continues to be a good market for U.S. seafood products, particularly squid, fresh hake, salmon and live lobster. Surimi, a newcomer, has become one of the fastest growing U.S. seafood successes in Spain.

Sales of two U.S. products are particularly affected by the strength of the dollar--U.S. frozen salmon, which faces stiff competition from Norway's fresh salmon, and fresh lobster.

But U.S. exporters should focus on more than price; think trade servicing, consistency and reliability.

Two relatively easy promotional undertakings--with surprisingly broad impacts--are available to exporters in Spain: an informational booth at MercaMadrid, Madrid's main seafood distribution center, and trade delegation visits to importers of frozen seafood in Vigo, Galicia.

Though only about 5 percent of total imports are handled through MercaMadrid, most distributors and retailers source their product from the market. A U.S. presence provides an excellent opportunity to supply information, meet customers and introduce products to Spain's major buyers.

For those interested in an immediate promotional opportunity to expand or establish sales, the Foreign Agricultural Service will sponsor a special U.S. Seafood Pavilion at the Alimentaria >98 trade show held in Barcelona March 2-6, 1998.

Spain's principal catch consists of blue fish, hake, whiting, codfish, tuna and those tentacled denizens of the deep known as cephalopods (such as squid and octopus). With regards to fish, Spanish vessels caught 1.4 million metric tons in 1996, down slightly from 1995. Further declines are expected in the next few years.

However, mussels are another story. In 1996, mussel farmers increased production about 4 percent over 1995, to just over 230,000 tons. This best-selling seafood item is expected to continue its increase due to its nonrestricted availability and good pricing.

Canned fish production was up 1.8 percent from 1995, almost at 230,000 tons, with tuna capturing half of the canning industry output, followed by sardines, squid, mussels and mackerel. Smoked fish production grew 8 percent in 1996, surpassing 10,000 tons.

To meet domestic demand in the face of declining supply, Spain increased its 1996 seafood imports by 4 percent, up to 977 tons. About a third of this amount came from other EU countries. Argentina, Namibia and Morocco were other major suppliers.

Sardines, hake, salmon, megrim (flatfish or white sole) and anchovies made up most of the fresh imports. Frozen imported species include hake, tuna, sole, mackerel and sardines.

Meanwhile, a strengthening dollar hampered U.S. seafood exports to Spain in 1996, contributing to a 20-percent decline, down to 16,000 tons.

The dollar disadvantage aside, with Spain's catch decreasing and dependence on imports increasing, U.S. exporters need to make plans now for market entry.

Before gaining market entry, U.S. seafood suppliers must make the EU-approved list of seafood exporters. Information about certification requirements is available from the Food and Drug Administration, phone (202) 418-3160.

Expect the Spanish canning industry to demand more frozen tuna and mackerel. Spanish canners are producing more products with fish as the main component, such as tuna with vegetable oil and cod in tomato sauce.

Admittedly, the Spanish currently prefer the less expensive (because it's subsidized) farm-raised fresh Norwegian salmon to frozen U.S. product. However, introductory promotions, which effectively convey the quality of wild, natural U.S. salmon, could lure new customers.

As elsewhere in the world, changing lifestyles and a more diverse work force will inevitably bring about increased demands for processed ready-to-eat products. The value-added or prepared fish sector offers the newest potential--with U.S. quality and technology capable of tipping the balance towards U.S. products.

Other products with excellent potential include smoked King salmon and frozen and fresh squid. Lobster demand is strong during the Christmas season.

In an effort to circumvent their restricted catch allowances, Spain's fish companies have jumped headlong into interesting joint ventures. The Spanish partner provides the boat, the expertise and up to half of the crew. The other partner provides the license to catch in international waters and the rest of the crew. The home office of the joint venture company is located in the partner's country. Catches are unloaded in Spain and appear in the Spanish statistics as imports. Companies that participate in these ventures are concentrated in the United Kingdom, Argentina and Chile.

In addition, the EU Commission signed fishing agreements with 34 countries to maintain the EU fleet in their national waters. The EU compensated these countries about $320 million in 1996.

MercaMadrid, where the lion's share of Madrid's fish is distributed, marketed over 170,000 tons of seafood products in 1996. Most distributors and retailers source their product from this market. Here's what sells at the market:

Frozen Fish	Shellfish	Fresh Fish
Anchovies Hake Whiting Sardine Megrim Salmon Trout Codfish Sole Bream	Squid Hake Shrimp Prawn Whiting Octopus Sole Short-fin squid Codfish Bream	Mussel Littleneck clams Shrimp Crab Clam Swimming crab Periwinkle Oyster Snails Edible crab

People tend to love 'em or hate 'em, but if you are a calamari (squid) aficionado, you can understand why the multiple-armed cephalopods are causing a stir in California waters.

With a catch exceeding 80,000 tons in 1996 (according to California Seafood Council statistics), fishermen off southern and central California are making waves felt on the other side of the world by seafood consumers.

California market squid, or Loligo opalescens, is one of the fastest growing sectors of the U.S. seafood export market. Available canned, in its own ink or tomato sauce, and fresh or frozen, the eight-armed California delicacy is showing up on dinner plates from Baja to Barcelona.

The author is an agricultural specialist with FAS' Office of Agricultural Affairs in Madrid. Tel. (011-34-1) 435-0133; Fax: (011-34-1) 576-8063; E-mail: agmadrid@bitmailer.net