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 GENERAL SEAFOOD MARKET OVERVIEW
Farm Raised Seafood Market
The worldwide market for farmed marine species continues to grow. In British Columbia alone, farming production increased from US$44.56 million in 1988 to US$190.24 million in 1998. Although significant growth occurred in salmon farming and little or no growth occurred in shellfish (oyster) farming, recent problems within the salmon industry are causing some salmon farming interests to turn towards shellfish. Island Scallops can only benefit from this recent trend towards shellfish, as training farmers in correct husbandry would only add another revenue stream.
The majority of the world's current scallop production comes from three species of scallops: the Japanese scallop, the sea scallop and the king scallop. The Chinese scallop is also selling well, but FDA inspections of facilities in China found that the conditions and hygiene were issues as hatcheries were highly polluted. There has also been a fishery boom on the east coast of Canada and the U.S. with the Digby or sea scallop. Overall, Island Scallops produces a high quality product at a fair price that should compete very favorably on the worldwide market.
General U.S. Seafood Market Trends
In the United States, consumption of scallops exceeded 64 million pounds in 2002. This represented a per capita consumption of 0.22 pounds, with a dollar value of US$342 million. After shrimp, scallops represent one of the most popular shellfish products in the United States. In general, per capita consumption of seafood in the United States has remained steady over the last six years, ranging from 15.2 to 16.2 pounds per annum. Given consumers' growing preoccupation with healthier foods and the increasing availability of seafood (due to the recent successes in aqua farming and improved distribution channels), industry analysts expect per capita consumption to continue to increase.
Seafood Market Constraints
There are a limited number of regulations that restrict the fishing, distribution or purchase of scallops in Canada and the U.S. The whole and shucked scallops are frequently thought of as commodities. Therefore, the country of origin makes little difference as to the pricing or demand for scallops. The United States is the exception to the rule. The vast majority of U.S. brokers/distributors soak or dip their scallops in sodium tripolyphosphate (STPP), thereby enhancing the weight of the product by reducing the rate of fluid loss. Scallops treated this way are referred to as processed scallops. Over-soaked scallops can shrink as much as 30 percent when cooked, have little taste, and develop a rubbery texture.
However, there is a growing segment of the consumer market that demands unprocessed, natural scallops. These people address consumer concerns about chemical food additives and want to avoid the risk of purchasing an over-soaked product. ISL only sells natural scallops and will not permit its brokers/distributors to process scallops, which guarantees its customers a high quality product.
A further limitation to market supply is paralytic shellfish poisoning (PSP) or "red tide". PSP is a toxin generated by plankton (scallops' food) at particular times of the year, most noticeably during the early fall. The toxin is passed to the scallop when plankton is digested, but the toxin does not harm the shellfish. However, the shellfish containing the toxin can be harmful to humans who consume it. Even though only a limited number of human deaths caused by red-tide poisoning have been reported, a public announcement of red tide has a devastating effect on most shellfish sales. The exception is scallop meat, because the adductor muscle of the scallop does not concentrate the toxin; shucked scallops are safe to eat at any time of the year. Nevertheless, public perception could still influence demand over short periods of time. To control for PSP, the federal Fisheries Inspection Branch constantly monitors samples of shellfish production and wild shellfish populations.
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 SCALLOPS BLACKCOD GENERAL FISHERIES  MARKETING OVERVIEW |
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