aquaculture marketing analysis and opportunities in the...

Aquaculture White Paper No. 3NRAC Publication No. 03-003

Aquaculture Marketing Analysis and Opportunitiesin the Northeast Region

September 2003

NRAC White Paper No. 3 Marketing Analysis & Opportunities of 72 pages

Table of ContentsIntroduction 1The Global Aquaculture Industry 4The U.S. Aquaculture Industry 7U.S. Aquaculture Imports and Exports 9U.S. Consumer Characteristics 9Northeast Region 15Marketing Considerations �– 4 P�’s 18

Product 18Price 19Place (Distribution) 20Promotion 26

Aquaculture Product Trends 27Atlantic Salmon 27Artic Char 32Baitfish 32Biotechnology 32Catfish 34Hybrid Striped Bass 36Tilapia 38Trout 40Crawfish 41Hard Clams 41Mussels 43Oysters 44Remediation 48Seed sales 48Ornamental Fish and Plants 49

Market Trends 50Opportunities 53Questions to be Answered 53Areas of Concern from a Marketing Perspective 54Areas for Future Research 55Industry Feedback 55References 56Appendix 60


INTRODUCTION

Aquaculture has been labeled the Blue Revolution. It represents one of mankind�’s biggesthopes for generating affordable protein for an ever-increasing population. Much is knownabout how to grow fish and shellfish. In comparison, little is known about the economicsof production and marketing. It is the purpose of this White Paper to document where theindustry stands with regard to current marketing practices and to provide insight intowhat needs to be done, again from a marketing perspective, to increase thecompetitiveness of the industry and the profit levels of the farmers. With theglobalization of markets, the ability to remain competitive through a variety of strategiesincluding niche marketing, product identification, quality standards, and new productintroductions is critical to success and survival.

Our focus will be on the marketing practices and conditions faced by growers in theNortheast Region as defined by the U.S. Department of Agriculture. The region includesConnecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey,New York, Pennsylvania, Rhode Island, Vermont, Washington D.C., and West Virginia.According to the 1998 census of aquaculture in the U.S., the Northeast Region contains436 farms with total gross sales of approximately $122 million, which account for 11percent of all U.S. aquaculture firms and 13 percent of total U.S. aquaculture sales(NASS, 1998).


Characteristics of the Northeast region are somewhat unique and lend themselves tomariculture more so than freshwater aquaculture. Overall, seafood raised in marine andbrackish water accounted for 284 million pounds of U.S. aquaculture production in 1998(FAO, 2000b). The following table summarizes the contribution that aquaculture makesto each state within the region. Unfortunately, the Food and Agriculture Organizationprojects only a one percent growth in U.S. aquaculture production over the next twentyyears.

NRAC Aquaculture Production 1998 NASS CensusState # Farms $ Millions Avg/Farm Rank

Connecticut 23 17.6 765,217 2Delaware 6 n/a n/a n/a

Maine 65 66.6 1,024,615 1Maryland 52 14.8 284,615 3

Massachusetts 111 5.94 53,514 7New Hampshire 8 0.8 100,000 6

New Jersey 28 5.79 206,786 4New York 54 1.83 33,889 8

Pennsylvania 51 7.63 149,608 5Rhode Island 3 n/a n/a n/a

Vermont 8 0.16 20,000 10Washington, D.C. n/a n/a n/a n/a

West Virginia 27 0.69 25,556 9Total 436 121.84 279,450


The aquaculture industry in the Northeast is comprised of mostly small to medium-sizedcompanies usually operated as �“mom and pop�” operations. There are a few large salmonfarming operations and some dominant shellfish companies.

In an effort to quantify the scale of operations, the team looked at several differentclassification schemes. On a national basis, the United States Department of Agricultureuses the following annual gross farm-gate sales classes in assigning a size category toland-based agriculture: small-less than $19,000; part-time $20,000-$99,000; moderate$100,000-$199,999; large $200,000-$499,999; and very large $500,000 and over. It isinteresting to note that the categories are so broad, and that there is no distinctionbetween gross and net sales in the USDA categories.

Some Northeast producers felt that the following categories were appropriate: small-under $100,000; medium -$100,000-$300,000 and large-over $300,000. Depending uponspecies and culture system, it was felt that a minimum gross sales of $100,000 would benecessary for this to be a full-time occupation. In any case, in establishing anycategorization applicable to the Northeast, increased production costs includingregulation, utility, land and labor must be factored into the equation.

On a national basis, NRAC developed the following segmentation scheme: hobby-$1,000-$24,000; small-$25,000-$99,999; medium-$100-$999,999; and large $1,000,000or more. Under this scheme, very few operations would be considered large scale.

In the urbanized Northeast, we have estimated that a facility would have to gross at least$100,000 to be a full time employment. For this reason, we opted to follow the USDAcategories.

The average gross sales for each state reflect the products produced by that state.Massachusetts has the most aquaculture businesses in the region (n=111) while Mainehas the highest dollar volume of sales ($66.6 million). Maine�’s largest aquacultureproduct is salmon. Salmon farming produces the second most valuable ocean crop inMaine (Boch, 2003), the first being Maine lobsters (commercially harvested).

Connecticut is the leading producer of clams and oysters on the East Coast, growing from54,000 bushels in 1982 to 146,000 in 1992 to 290,000 in 2002 and is now a $10 millionindustry with most product going to New York City and Boston (Gustin, 2003). Andmany are betting that Connecticut�’s shellfish industry has ample room for expansion: TheMohegan Tribe has committed $7 million to a shellfish hatchery and aquaculture programin Connecticut (Johnson, 2003). Not all states are reporting positive growth: TheMaryland oyster harvest was 50,000 bushels in 2002, down from 1.5 million in the1980�’s (Meyer, 2003).

Growth is feasible for the region, however it may be limited by access to adequatemariculture environments and increased government regulation of aquaculture. In


Massachusetts, on average, six new businesses apply each year for aquaculture access instate waters (Daley, 2003). Because of population density and real/perceived user

conflicts, the Northeast aquaculture industry is one of the most regulated anywhere in theworld. The major marketing challenges faced by the industry include: 1) development ofcost-efficient production systems, 2) meeting foreign competition, 3) addressing negativeperceptions of farmed seafood and 4) public concerns about environmental degradation.

Unfortunately, there is very little data available on the United States aquaculture industryand indeed on the entire seafood industry. Often, because of the small size of thereporting sector, data is protected by confidentiality. We have tried to compile data froma number of different sources to arrive at some projected trends especially in terms ofsupply and price.

To make price projections and analyze trends, the team relied on pricing and salesinformation available from Fulton Fish Market in New York, Urner Barry market reportsand United States Customs reports. The Fulton Fish Market information is based on avoluntary reporting system and is not as complete as might be hoped. However, it is oneof the best sources of information on movement into and out of the New Yorkmetropolitan market.

This White Paper is organized in a drill-down structure, progressing from the broaderglobal market for aquaculture products to the U.S. market and finally to the northeastmarket. U.S. consumption and consumer characteristics are contrasted with regionalconsumption and consumer characteristics. An examination of marketing factors (alsoknown as McCarthy�’s four P�’s which stand for product, price, promotion and place) forthe Northeast is offered. Opportunities for growth/expansion are identified. This includesexamining national trends in the production/consumption of finfish and shellfish to allowestimate future demand.

In addition to a brief analysis of the food fish market, the paper also provides backgroundon lesser-known opportunities such as production of baitfish, ornamentals and plants andanimals for remediation. Although there is little actual data about these sectors, they maywell represent the best opportunities for aquaculturists in the region.

The Global Aquaculture IndustryDwindling fish stocks have made aquaculture more important globally (Fabricant, 2003).Some estimate that more than 70 percent of commercial fish stocks are fully exploited,over-fished or collapsed (Broad and Revkin, 2003). The world commercial fish harvesthas reached a plateau of 100-120 million metric tons with about ¾�’s going to humanconsumption. This amount hasn�’t changed much over the past five years (Schmidt, 2002).


Top 20 World Finfish & Shellfish SpeciesThousand Metric Tons2001rank

Species 1994 1995 1996 1997 1998 1999 2000 2001

1 Pacific Cupped Oyster (Crassostreagigas)

2,536 2,925 2,925 2,972 3,433 3,603 3,912 4,109

2 Grass Carp (Ctenopharyngodonidellus)

1,821 2,104 2,440 2,727 3,023 3,313 3,427 3,636

3 Silver carp (Hypophthalmicthysmolitrix)

2,219 2,553 2,878 3,239 3,331 3,403 3,470 3,546

4 Common Carp (Cyprinus carpio) 1,536 1,816 2,036 2,208 2,401 2,616 2,703 2,8495 Japanese Carpet Shell (Ruditapes

philippinarum)1,169 1,148 1,156 1,315 1,474 1,870 1,694 2,091

6 Bighead Carp (Hypophthalmichthysnoblis)

1,076 1,257 1,418 1,555 1,587 1,611 1.639 1.663

7 Crucian Carp (Carassius carassius) 390 538 693 863 1,036 1,239 1,379 1,5278 Yesso Scallop (Patinopecten

yessoensis)1,026 1,145 1,265 1,257 856 929 1,133 1,196

9 Nile Tilapia (Oreochromis niloticus) 426 520 624 732 766 879 1,034 1,10910 Atlantic Salmon (Salmo salar) 375 465 552 647 688 804 891 1,02511 Rohu (Labeo rohita) 423 473 566 687 647 719 743 83412 Catla (Catla catla) 353 396 477 579 530 591 804 66913 Tiger Prawn (Panaeus monodon) 559 566 540 483 505 550 619 61514 Razor Clam (Sinonovacula

constricta)253 307 343 354 415 479 553 597

15 Mrigal (Cirrhinus mrigala) 346 390 463 516 468 520 527 58916 Beijing Bream (Parabramis

pekinensis)282 336 379 435 449 476 512 541

17 Rainbow Trout (Onchorhynchusmykiss)

335 365 385 427 438 415 448 510

18 Milkfish (Chanos chanos) 346 390 463 516 468 520 527 59019 Blue Mussel (Mytilus edulis) 329 358 408 401 502 498 461 42620 Ark Shell (Anadara granosa) 201 252 224 199 288 332 302 346Data Source FAO 2002*Table does not include kelp (Laminaria japonica) 4,170, 000 metric tons

It is interesting to note the discrepancies between the estimates of worldwide productionproduced by various sources, illustrative of just how difficult it is to develop accurateforecasts of supply and demand globally.

China produces 70 percent of the world�’s aquaculture products, mostly for use in China.Exports in 2001 totaled $550 million to the U.S., $600 million to Europe and $2 billion toJapan (Chao, 2003). She is by far the largest member of the aquaculture food chain andonly one of a handful of countries who farm/grow more seafood products than aregenerated by commercial fishing.

Many of the top species aquacultured worldwide are not even available in the UnitedStates market.


Top Twenty Species of Finfish and Shellfish Globally By Value 2001(1,000 USD)

Common Name Scientific Name Value 2001Tiger Prawn Panaeus monodon $4,722Pacific Cup Oyster Crassostrea gigas $3,376Silver Carp Hypophthalmichthys

molitrix$3,176

Grass Carp Ctenopharyngodon idellus $3,054Common carp Cyprinus carpio $3,000Atlantic Salmon Salmo salar $2,788Japanese Carpet Shell Ruditapes philippinarum $2,477Pink Spotted Shrimp Panaeus chinensis $1,850Rohu Labeo Rohita $1,570Yesso Scallop Platinopecten yessoensis $1,555Rainbow Trout Oncorhynchus mykiss $1,472Big Head Carp Hypophthalmichthys noblis $1,453Nile Tilapia Oreochromis niloticus $1,439Chinese Mitten Crab Eriocheir sinensis $1,432Yellowtail Seriola quinqueradiata $1,302White Shrimp Panaeus vannamei $1,133Milkfish Chanos chanos $1,126Crucian Carp Carassius carassius $1,075Eel Anguilla rostrata $ 889Beijing Carp Parabramis pekinensis $ 662Data Source: FAO, 2003

The rapid growth of global population and the need to provide people with affordablesources of protein place stress on food stocks. Fish currently makes up about sevenpercent of the world�’s food supply (USA Today, Nov. 4 2002). Given these conditions(dwindling fish stocks and increased population), it is no surprise that aquaculture hasgrown from 3.9 percent of total world production in 1970 to 27.3 percent in 2000 (FAO,2002). In 2000, the industry produced 36 million tons of fish and shellfish and since 1990has been growing at an average compound rate of 10 percent per year. Aquaculture ismost likely the world�’s fastest growing form of food production (Economist, 2003: p.19).

According to a recent article in The Economist (2003), aquaculture�’s promise is thatwithin three decades it could produce most of the world�’s marine products (p. 9). Thesame article classifies aquaculture into good forms and bad forms: good forms includetilapia, scallops, mussels and oysters. The good forms feed lower on the food chainconsuming plant material. Tilapia may become the next �“chicken of the sea.�” According


to the article, salmon and sea bass are bad forms: they feed on fish protein, the productionof which further depletes oceanic stocks and generate pollution (Economist, 2003: p.9).

These environmental considerations are becoming increasingly more important whenpositioning aquacultured products in the marketplace.

This subjective classification is based upon the perceived impact that farming a species ina mariculture or aquaculture environment has upon the general environment. Finfishspecies that feed on other fish are perceived having the most negative impact on thesurrounding environment. Great strides in open-water mariculture, in general, and salmonfarming in particular have lead to record levels of salmon being sold worldwide.

The U.S. Aquaculture Industry

Over 76 percent of all seafood consumed in the U.S. is imported according to theNational Marine Fisheries Service (NMFS) totaling nearly $10 billion in 2001. OnlyJapan imports more fish (Fabricant, 2003). Almost fifty percent of the fresh and frozenseafood consumed by Americans is farmed (Economist, 2003: p. 19). The USDA figureis around 45 percent (Harvey, 2002) of which shrimp, Atlantic salmon and Tilapiaimports were valued at $2.7 billion. The U.S. ranks third in national consumption andfourth in total fisheries catch in the world (NMFS, 2000).

U.S. Fish and Seafood Trade Value 1993-November 2002(Million US Dollars)

1993 1994 1995 1996 1997 1998 1999 2000 2001 Nov. 2002

Imports $5,849 $6,645 $6,792 $6,730 $7,754 $8,173 $9,014 $10,054 $9,864 $7,036Exports $3,077 $3,126 $3,126 $3,262 $2,713 $2,260 $2,849 $2,965 $3,195 $2,663

Data Source: NMFS

Commercial landings in the US for 2001 were 9.5 billion pounds valued at 3.2 billiondollars, 87 percent of which were finfish (NMFS, 2002). Edible fish and shellfishlandings totaled $7.3 billion in 2001 (NMFS, 2002). U.S. demand for edible fish andshellfish was down six percent from 2000 levels.

Recent estimates put the seafood trade deficit at nearly $10 billion (Jamir, 2002), makingit one of the largest areas of trade imbalance faced by the U.S.

The aquaculture industry in the U.S., dominated by freshwater catfish, generates about $1billion annually (Goldburg et al., 2001). The bulk of U.S. production in freshwater


aquaculture is located in the southeast region. Despite the extent of coastal access in theUnited States, growth of marine aquaculture has been slow (Goldburg et al., 2001).


Data Source: NMFS

Production of marine finfish may become a significant growth area in the future. The topten aquaculture producing states in terms of value of products sold are Mississippi,Arkansas, Florida, Maine, Alabama, Washington, Louisiana, California, Idaho andVirginia. All except Arkansas and Idaho have ocean coastlines.

0

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Country

United States Seafood Import Trade PartnersJanuary 2000 - November, 2002

2000 1,915 1,816 585 532 499 3022001 1,976 1,228 674 494 499 4782002* 1,910 1,608 768 332 473 553

Canada Thailand China Mexico Chile Vietnam


U.S. Aquaculture Imports and Exports

The United States domestic aquaculture industry is expected to face strong competitionfrom imports throughout 2002 and into 2003. The domestic industry is faced with recordproduction levels and lower prices, putting a squeeze on profits (Harvey, 2002). Asproduction increases, prices decrease and the market becomes supply rather than demanddriven. This shift requires additional promotion and marketing which further depressesprofits.

Tilapia is the fastest growing imported finfish in the United States. Imports of tilapiagrew by 22 percent over 2001 levels. In the period from 1995 to 2001, imports increasedby 367 percent (Harvey, 2002). Salmon imports continued to increase driving the marketprice downwards in a trend similar to the one experienced by shrimp. Shrimp importsduring 2001 increased by 15 percent volume, sending prices down by six percent(Harvey, 2002).

U.S. exports of oysters, mussels and clams were down in 2001 compared to 2000 but thediminished level of exports may be attributed to the strength of the U.S. dollar versusforeign currencies in that time period. Oysters and clams offer good export opportunitiesfor northeastern aquaculture growers whereas mussels tend to be imported more thanexported (Harvey, 2002).

U.S. Consumer Characteristics

EXPENDITURES

U.S. consumption of fish and seafood products has slowed and is at 14.8 pounds of ediblemeat per capita in 2001 (NMFS, 2002). As illustrated by the graph below, U.S. fish andshellfish consumption has remained stagnant over the past decade: 14.8 pounds per capitain 1992 to 14.8 pounds per capita in 2001, with a high of 15.4 pounds per capita in 1999.


Data Source: NMFS

Historically, fish and shellfish consumption has lagged behind other protein consumption.Seafood�’s share of market hasn�’t changed significantly over the past decade. Consumerswhen faced with protein selection tend to follow the economic principle of rationalhuman: they shop in a manner to maximize their utility (amount of protein) within adefined budget. It is often said that seafood�’s main competition isn�’t other seafood �— it�’schicken! As illustrated by the graph below, chicken is the top per capita protein source inthe U.S. On the positive side, this represents a major opportunity for increased marketpenetration. The basic strategies to increase sales are: 1) attract new customers, 2) attractyour competitors�’ customers and 3) convince your current customers to purchase more.

Beef, poultry and chicken all benefit from organized commodity promotion programs.Although numerous efforts have been undertaken to develop such a program for seafood,there has never been enough industry support. Additionally, especially for the poultryindustry, there has been a major focus on the promotion of branded products. Seafoodpromotion has been sporadic and most state and regional programs no longer have thefunding to support generic promotion.

United States Annual Fish and Seafood Consumption(per Capita)

14.414.514.614.714.814.915.015.115.215.315.415.5

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

Year

Con

sum

ptio

n (lb

s.)


U.S. Bureau of Labor Statistics

Data Source: USDA

In the United States, expenditures for away from home food purchases currently accountfor approximately 47% of total food expenditures. The National Restaurant Associationprojected away from home food expenditures will exceed home food expenditure by2010. Research shows that shrinking household size is accelerating this trend. Accordingto data published by the United States Department of Agriculture (USDA) EconomicResearch Service, Americans spent $440 billion in grocery stores in 2001 and about $365billion in restaurants. The highest level of overall expenditure for home consumption is inthe Northeast but this is most likely explained by higher retail prices in the region.

In general when comparing annual expenditures for fish and seafood consumed at homewith income level, fish and shellfish comprises a much greater percentage of income atthe lower end of the income range. This fits with general economic indicators that placeseveral prominent ethnic groups that regularly enjoy fish and seafood at the lower end ofthe economic spectrum.

United States Annual Fish and Seafood Consumptionvs. Selected Alternative Choices

(per Capita)

0.0

20.0

40.0

60.0

80.0

100.0

Year

Con

sum

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n (lb

s.)

Beef 66.6 66.3 64.9 66.9 67.3 68.1 66.7 67.9 66.4 62.5Chicken 63.1 66.9 69.5 70.5 69.8 70.8 71.8 72.4 77.5 81.7Pork 50.0 52.7 52.0 52.7 52.2 48.9 48.5 52.3 52.3 50.6Fish & Seafood 14.9 14.8 15.0 15.2 15.0 14.8 14.6 14.9 15.4 15.6

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000


An AC Nielsen Consumer Survey in June 2002, found that 37% of African Americanshave eaten healthier diets in the past six months compared to White and Asian groups.African Americans are at a more elevated risk for high blood pressure than any othergroup and this might explain the trend toward healthier meals. This community isdefinitely a target market where fish and seafood products can be promoted

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0-9.

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4.9

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920

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-39.

940

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9.9

50.0

-59.

960

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9.9

70.0

-89.

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Consumer Income Level USD ($000)

Annual Expenditures for Fish and Seafood Consumed at Homeby Consumer Income Level

2000 - 2001 (per Capita)


0

200

400

600

800

1000

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Year

Annual Expenditures for Seafood Consumed at HomeExpresses as per cent of Total Protein Consumption

(per Capita)

Fish & Seafood 87 89 97 88 89 98 106 110 114Other Protein 734 732 752 737 743 723 749 795 828% of Total Protein 11.9 12.2 12.9 11.9 12.0 13.6 14.2 13.8 13.8

1993 1994 1995 1996 1997 1998 1999 2000 2001

Data Source: U.S. Bureau of Labor Statistics

SEAFOOD CHOICES


Consumption of fish and seafood products in the United States has failed to grow despitethe increased availability and array of products in the marketplace and the fact thatconsumers are aware of increased health benefits of including more fish and seafoodchoices in their diets. Seafood choice is generally limited to ten species that compriseapproximately 80% of all consumption. Aquacultured products are now among the topten most likely as a result of greater availability and decreasing price.

United States Annual Per Capita Consumption by Species in Pounds

2001 2000 1999 1998 1997Shrimp 3.40 Tuna 3.50 Tuna 3.50 Tuna 3.40 Tuna 3.10Tuna 2.90 Shrimp 3.20 Shrimp 3.00 Shrimp 2.80 Shrimp 2.70Salmon 2.02 Pollock 1.59 Salmon 1.70 Pollock 1.65 Pollock 1.64Pollock 1.21 Salmon 1.58 Pollock 1.57 Salmon 1.38 Salmon 1.30Catfish 1.15 Catfish 1.08 Catfish 1.16 Catfish 1.06 Cod 1.06Cod 0.56 Cod 0.75 Cod 0.77 Cod 0.97 Catfish 1.02Clams 0.47 Clams 0.47 Crabs 0.54 Crabs 0.57 Clams 0.46Crabs 0.44 Crabs 0.38 Clams 0.46 Flatfish 0.94 Crabs 0.42Flatfish 0.39 Flatfish 0.42 Flatfish 0.39 Clams 0.39 Flatfish 0.33Tilapia 0.35 Scallops 0.27 Scallops 0.20 Oysters 0.23 Halibut 0.29Data Source: NMFS

HEALTH TRENDS

It is believed that as the U.S. population ages, an increase in fish and shellfishconsumption can be anticipated as the health benefits of consumption are increasinglyevident. However, these projections of possible increased consumption must be temperedwith the real and perceived high cost of fish and shellfish compared with other proteinsources.

Despite recent changes in the U.S. diet that reflect a conscious trend toward more healthychoices, consumption patterns in fish and seafood remain stagnant and in decline. TheAmerican Heart Association recommends a meal of oily ocean fish (tuna, salmon, herringor mackerel) at least once a week, but less than ten percent of Americans comply(Krause, 2003).

In a recent survey conducted by the U.S. Department of Agriculture, consumers wereasked how they planned to improve their diet. Only 4% of those surveyed indicated thatthey plan to eat more fish and seafood.

ORGANIC PRODUCTS


Organics (certified organically produced products) are steadily increasing in market-share. Health food stores, food co-ops, many supermarkets and websites devote varyingamounts of shelf space to this growing product category. Recent consumer panels showthat approximately seventy percent (70%) of U.S. consumers have purchased organicproducts. Of the thirty percent (30%) who did not purchase, almost fifty percent (50%)indicated that the products were too expensive. Others felt that there was not a goodselection and they were unfamiliar with the products. A growing number of markets aredevoted exclusively to health-conscious consumers.

0% 10% 20% 30% 40% 50%

Too Expensive

Lack of Familiarity

Not a Good Selection

Not Available

Quality Concerns

Barriers to Purchase of Organic Foods

There are major obstacles to be addressed in gaining organic certification foraquacultured products especially in terms of feed. This is an area that needs furtherresearch.

ETHNIC MARKETS

The primary ethnic markets for seafood products are Asian consumers. These marketscan be segmented into a variety of different cultures including Chinese, Japanese,Vietnamese, Thai and Cambodian. Each has its own food preferences. Because theydemand high quality and, often, live products, they are particularly good targets for smallto medium-sized growers.

The Orthodox Jewish market often demands live kosher fish so that they can bebutchered using appropriate utensils. This is also an opportunity for species such as carpthat are often not produced by local aquaculture operations. Broader Eastern European


groups are also potential outlets for traditional freshwater fish especially at the holidayswhen consumers are willing to pay a higher price.

Although several groups have looked at Hispanic markets, product demand remains lowand is often focused on traditional species. According to a study conducted by theFlorida Department of Agriculture, seafood is more likely to be the primary or secondarymeat of Hispanics in Boston (36%), Los Angeles (36%) and Miami (35%) markets thanin other markets.

Northeastern Region Northeastern Market Structure Survey

To gain a more complete understanding of the market dynamics operating in theNortheast aquaculture industry, the White Paper Team contacted knowledgeableindividuals throughout the region. This technique provided insights into the marketviewed from three different perspectives-growers, government advisors and buyers.Through a process of triangulation, the team attempted to gain insights and assess currenttrends. This information was supported by a number of data sets available fromgovernment and private entities.

There is general agreement that the available data often relies on anecdotal informationand can only provide a shallow understanding of the industry. Many states do not conductregular surveys of growers and it is difficult to gather actual production data.

Northeastern Market Climate

Growers in the Northeast face a number of challenges caused by attributes of the product,the market and regulatory structure of densely populated states. Although these problemsare difficult to address, the White Paper Team attempted to identify market opportunities,sales barriers, viable market outlets and areas that require further investigation.

Because this is such a strong market, competitors from other states and foreign nationsroutinely target the region. Competition from developing countries that have a pressingneed to secure hard currency often sell product into the region at below market price. Ithas been difficult to seek relief from anti-dumping regulations. It is becomingincreasingly difficult to compete in saturated markets such as salmon and catfish withouta marketing advantage.

In terms of competition, several states indicated that there was significant competitivepressure from other states in addition to foreign imports. A major question that needs tobe answered is the brand utility of local production. What is the end user willing to payfor local production?

In some states, the regulatory climate is stricter than in other areas. This was in terms ofsales restrictions, i.e. clam sizes, high costs of permitting and licensing, technical cost of


operating in a highly regulated environment and limitations on species selection. Someways to overcome these costs include development of appropriate production systems,including polyculture, and species selection.

Several states in the Northeast have limited production to one or two species althoughthere have been efforts to support expansion.

Most aquaculturists in the region sold their product to wholesalers. Small and medium-sized growers should consider shortening the distribution chain especially in terms ofreaching the end-user, either restaurateur or consumer, where the highest mark-ups can beachieved.

Most sales were limited to the Northeast. Many shellfish sales were within 100 miles ofthe production site. If production increases, there is a need to identify locally-farmedproduct as being of superior quality than the competition or to identify viable marketsoutside of the immediate region.

Government advisors indicated that expanded production would allow aquaculturists tomaintain and expand market share. This may or may not hold true since this might createa supply driven market that is further exacerbated by inexpensive imports. Historically,increases in production have driven prices lower and required greater marketing inputs toabsorb increased production. Consistent production was also cited as a problem inincreasing sales. This was a problem identified by both major retailers and restaurateurs.Two restaurateurs indicated that they had purchase arctic char and were very satisfiedwith the product, but then could not source it on a regular basis. Small independentretailers, a sector with an average mark-up of 60 percent, indicated that they were notwilling to invest in promoting new products to their customers unless they could beassured of a consistent supply of product.

In the case of some of the more lucrative products including aquarium fish, ornamentalfish and ornamental plants, very little actual data was available was available. Mostinformation was developed through personal communication with growers.

Studies of seafood consumption habits for those living in the northeast have beenconducted over the past decade yielding similar results. Gall and O�’Dierno (1993)surveyed consumers, retail stores and food service establishments in New York and NewJersey as part of an aquaculture marketing study. Most consumers were not aware that theseafood they were eating was farm-raised. Wessells et al. (1994) studied consumerpreferences for northeastern aquaculture products and found that as many as 60 percentof their respondents were unfamiliar with aquaculture. More recently, Barnes et al.(2003) studied consumer preferences for shellfish and compared their results to Wessellset al. (1994). They surveyed consumers in New York, New Jersey, Massachusetts,Connecticut, New Hampshire and Vermont. Of those surveyed, 55 percent eat clams, 65percent of those eat clams in restaurants, 46 percent are familiar with aquacultured clams(up from 25 percent in the Wessells study) and that 73 percent are willing to pay more foraquacultured clams. After a decade of promotional efforts, consumers, restaurateurs,


supermarket buyers and retailers still are not that familiar with aquaculture productionand the benefits it provides.

While the authors of these studies should be commended for undertaking a difficult andimportant task, each study has its weaknesses. The biggest weakness is the gap betweenself-reported consumer perceptions, intent and actual sales. These surveys rely upon averbal response rather than an action. The question remains, can consumer perceptions betranslated into actual purchase?

Another factor to consider is that most of these studies were conducted by non-professional marketers. Thus, despite the good intent of the researchers, themethodologies used and questions asked were less than rigorous. What is known aboutconsumers in the northeast region is that they spend more per capita on seafoodpurchases, especially for seafood purchased for home consumption. It is believed that thistrend reflects the historic tie that the northeast states have to the sea, using fish andshellfish as major sources of protein. Although consumer expenditures on fish andshellfish tend to be higher in the Northeast, this may be a factor of higher prices in theregion rather than higher levels of consumption. To this date, New Bedford remains thenumber one fishing port in the U.S. in terms of dollar value landed.

Marketing Considerations - The 4 P�’s of Marketing

70

90

110

130

150

170

USD

($)

Year

Annual Expenditures for Seafood Consumed at HomeConsumer Located in the Northeast vs. Average U.S. Consumer

(per Capita)

Northeast Consumer 119 123 129 113 108 113 133 149 154Average U.S. Consumer 87 89 97 88 89 98 106 110 114

1993 1994 1995 1996 1997 1998 1999 2000 2001


Product

Products produced in the northeast region include finfish, shellfish and ornamentals(plants and animals). Most growers/aquaculturalists select what to grow based upon theirability to successfully do so rather than based upon unfulfilled demand in themarketplace. This production-orientation strategy will work as long as the regional ordomestic marketplace can absorb increased production, or as long as the commercialharvest of these products continues to decline.

Farmed products can be sold in a variety of forms: fresh, frozen, canned, smoked, orotherwise processed. Demand for products in each category exists and prudentaquaculturalists offer more than one form of output to the distribution channel. Forinstance, a salmon grower may offer fresh whole salmon to a processor, salmon fillets toa restaurant and sell smoked salmon via the Internet.

It is clear that growers need to shift from a production-oriented philosophy (if you buildit, they will come) to a marketing-oriented philosophy (what do consumers want/need?)to succeed in the long-run. The applicability of this marketing-oriented approach (versusthe production-oriented approach) to aquaculture development is documented by Rhodes(2002). A Chilean aquaculture venture took the time to ask its target market what productit wanted, at what quality and with what characteristics. After conducting extensivemarketing research, they settled on a particular species of scallop to grow that met and/orexceeded the expectations of their clients.

Another opportunity for aquaculturalists is to grow multiple, yet compatible, products.Tilapia growers have had success combining either herb or waterplant farming withtilapia growing. The water (including waste) from the tilapia is filtered through the growbeds above the tilapia tanks to feed the herbs or aquatic plants. This phenomenon is oftenreferred to as polyculture.

For continued growth, aquaculturalists need to identify unique opportunities todifferentiate their products and services from those of their competitors, includingimported products. �“Made in�” and �“homegrown�” labeling has been used to remindcustomers of the importance of purchasing locally harvested seafood and to buildconsumer preference for locally grown products. Finally, co-branding opportunities existfor finished products such as crawfish meat stuffing included fish fillets.

Cultural branding refers to strategies that make an emotional connection between theproduct and the consumer. It taps into the consumer value system and provides acompelling reason for the purchase. Successful cultural branding depends upon socialcontext, experience, community, products and services and infrastructure sensibility.Companies that have successfully exploited this strategy are generally focused on naturalproducts and an established connection with the environment. This can be used as abranding strategy for farmed seafood and as a counter to the environmental assaultssuffered by the industry.


PRICE

Price is a major concern of aquaculturalists. No one wants to produce and marketproducts at a loss. Break-even points and profit margins are determined by consumerdemand the availability of products to satisfy this demand. Scarce, or difficult to find,products command higher prices in the marketplace. Conversely, over-production andimporting of products, or cheaper priced substitute products, drive down price. Thisprice-volume relationship is well documented by agricultural economists.

What is clear is that growers in the U.S. in general and the northeast region in particularcannot compete on price, especially vis-à-vis imported aquaculture products. Theincreased volume of imports is driving prices and profits down. Recent examples includecrawfish, clams, mussels and salmon.

In 2001, a shipment of Asian grown tapas clams entered the New York market at a verylow price compared to local production. The Asian product was marketed to restaurantsas a substitute for raw little neck clams. Use of the product in that format resulted in anoutbreak of foodborne illness. When restaurateurs were asked why they bought theproduct and used it as a raw product when they were aware that this was a violation ofFDA food policy, the answer was �“the price was so low, we couldn�’t pass it up.�”Currently, Canada, Chile, South Korea and New Zealand have MOUs with FDA thatallow importation of live shellfish.

The glut in salmon raised in the lower 48 states, Canada, Chile, Norway and Scotland hasdriven the price Alaskan commercial fishermen receive per pound down to 40 centsbankrupting many of them (Wilkinson, 2003). Regional aquaculturalists thus are forcedto follow the prices established by the glut of imports coming into the U.S. or riskbecoming non-competitive. And given the production cost advantages (competitiveadvantage) of foreign growers, it becomes a losing proposition to compete on price.Therefore, as stated in the product analysis above, growers will need to differentiate theirproducts with regards to the competition on variables that are salient to consumers.Segmenting, targeting and positioning (STP) are methods marketers use to commandhigher, profitable, prices for their products. Growers will need to identify marketsegments for which price is not the deciding variable in the purchase/do not purchasedecision. An example of this is to target high-end white tablecloth restaurants rather thanfishmongers, unless the fishmongers can move your products for profitable margins.This is the strategy used in many of the Canadian provinces when they target U.S.seafood markets.

For the price sensitive segment, economies of scale and scope (volume growing) offer anopportunity to remain profitable. For instance, some species of finfish have beengenetically modified to grow faster and bigger than their wild brethren, thus speeding upthe time from fingerling to harvest. This shortening of the grow cycle allows moreproduction to occur in the same space �– allowing farmers to become more efficient.Recent research indicates that although consumers have concerns regarding geneticallymodified products, if genetically modified fish results in a cheaper price, consumers are


16% more likely to consume it. Likelihood of consumption increases to 21 percent ifgenetically fish result in better taste (Bennett and D�’Souza, 2003).

PLACE (DISTRIBUTION)

In general, the seafood industry has become less structured and distinctions amongprocessors, importers, traders, brokers and distributors have become blurred with onecompany serving a number of functions depending upon its organizational objectives andthe needs of the buyer. U.S. Bureau of the Census 1998 data report that 197 (NMFS)firms in the northeastern region produce, prepare and package fish and seafood as theirprimary activity. This list includes supermarkets and retailers. Processing activitiesinclude filleting, shucking, baking, blending, chemical treating, cooking or other heattreatment, curing, dehydrating, grinding, mixing, packaging, roasting, vacuum packaging,salting, pickling, and/or preserving seafood products.

Wholesalers and distributors purchase large volumes of product often from manysuppliers. This product is then repackaged into quantities suitable for retail or foodserviceestablishments. Brokers are agents who never actually take possession of the product.They simply assemble deals. The distribution chain for seafood products can be veryconvoluted including a number of middlemen each of whom needs to take a percentage.This adds significantly to the price spread between farmer and end-user.

Sales Destinations of Seafood Sold by Other N.Y. Seafood Wholesalers

Consumers2%

Restaurants / Foodservice

60%

Business Outside N.Y.

8%

Retailers & Supermarkets

30%

Regardless of the distribution channel used, growers should remember that a majority (60percent) of all seafood sold in the northeast is consumed in restaurants and/or foodservice


locations. This is consistent with the results obtained by Barnes et al. (2003) whosurveyed seafood consumers in the northeast and reported that 65 percent consume theirseafood in restaurants.

Restaurant Preferences for Seafood Sales by Price

>$25 $20-$25 $15-$20 $10-$15 <$10Salmon Salmon Salmon Salmon SalmonMussels Oysters Scallops* Tilapia ClamsScallops* Clams Mussels Oysters MusselsClams Scallops* Clams Catfish CatfishOysters Mussels Catfish Scallops* Tilapia

In total, consumers purchased $38.2 billion in seafood from food service businesses and$16.8 billion in retail sales for home consumption in 2001 (NMFS, 2002).

Seafood processors and wholesalers are increasingly turning to imports to meet customerdemand and to make higher profits. Utilization of processors varies by species produced.

0% 10% 20% 30% 40% 50%

Imports

Other U.S. Sources

Processors

Fulton Market

N.Y. Fishermen

Sources of Seafood Purchased by Other N.Y. Seafood Wholesalers

As expected, the distribution channels utilized by northeast aquaculture farms differ byproduct or species marketed. According to the recent NASS (1999) census of aquaculture


(see table in appendix), 20.4 percent of all finfish farmed in the northeast region is sold toprocessors, 12.1 percent to retail operations, 1.7 percent direct to consumer, 32.1 percentto live haulers (probably to auction), 3.1 percent for use in recreational fishing facilities,16.7 percent to other producers, .1 percent to government agencies, and 13.8 percent to�“other.�” Depending upon the state of origin, baitfish is sold mostly to retailestablishments (Maine), direct to consumers (Massachusetts), and fee-fishing orrecreational use (Pennsylvania). Ornamental fish are sold direct to retailers or direct toconsumers. Sport or game fish are sold mostly to fee-fishing or recreational fishingestablishments. Crustaceans are sold direct to retailers, and mollusks are sold toprocessors, retailers and �“other.�”

During the Team�’s survey of government advisors, many felt that the majority of theaquacultured product was sold within 100 miles of the production site. Expandingoutside of this radius may be lucrative.

Three things can be inferred from this information: 1) What you grow impact how it is distributed, 2) Where you grow it impacts how it is distributed, and 3) seafood processorsand auctions tend to be more important for commercial fishermen than foraquaculturalists. The third item is the area of concern for aquaculturalists. Given thedecline of commercial landings, processors are turning to imports rather than farmed-product to meet demand.

What can be done? There are lots of opportunities for aquaculturalists in terms ofdistribution channels. Vertical integration presents an excellent opportunity foraquaculture producers to increase profits. This is how the U.S. catfish growers increasedtheir profits long ago. By 1970, a few catfish cooperatives formed and built their ownprocessing plants (Ziegenhorn, 2000). By controlling the processing, the catfishproducers enjoyed the profits usually made by the processors as well as the profits fromselling their fish to the cooperative�’s processing plants. This �“cooperative�” strategy is notnew to agriculture. For years, cranberry growers in southeastern Massachusetts havebenefited from their participation in the Ocean Spray cooperative, which was successfuluntil the recent glut of cranberries caused by expanded growing in Minnesota, Wisconsinand Canada. In Groton, a group of small shellfish-growers from Connecticut and NewYork have combined into what they say is the first cooperative shellfish hatchery in theworld (Johnson 2003), Wellfleet notwithstanding.


Processor Retail Direct to

ConsumerLiveHauler

Fee Fishing&Recreational

OtherProducers

Govt.Agencies

Other

Food Fish 20.4 12.1 1.1 32.1 3.1 16.7 0.1 13.0Maine 25.4 13.9 40.5 12.1 8.1

Maryland 9.7 0.5 2.1 3.5 2.9 92.1New Jersey 5.7 1.3 6.8 69.0 17.2New York 0.6 32.4 19.5 10.9 34.6 2.8 0.2

Pennsylvania 3.0 1.3 30.2 3.6 38.1 11.7 1.6 10.5Vermont 3.2 4.5 0.1 4.6 87.6

West Virginia 41.9 9.9 0.2 1.1 46.0 0.4

BaitfishMaine 32.6 29.1 32.3

Massachusetts 27.1 72.3New York 0.3 29.7 25.6 37.9 6.1 0.5

OrnamentalFish

29.1 5.2 0.4 0.6 0.1 65.6

Maine 100.0New York 52.7 35.1 12.4

Game Fish 4.0 11.2 10.0 19.8 51.4 1.4 0.3 1.1Connecticut 62.7 0.5 36.0Maryland 13,1 9.3 7.9 69.9 0.5 0.3New York 15.9 7.5 67.6 6.5 1.2 1.1 0.3

Pennsylvania 39.3 13.2 47.5Crustaceans 29.0 1.5 1.6 0.17.8

New York 59.7 5.0 29.0 2.1 5.0 0.2Mollusks 6.1 7.2 3.0 62.5 4.5 0.2 36.5Connecticut 0.1 0.9 0.1 91.9 0.8 6.3

Maine 12.3 39.4 1.2 13.4 7.3 0.3 26.1Maryland 17.2 10.2 72.6

Massachusetts 5.4 19.7 6.5 12.7 5.0 50.7New Jersey 38.9 1.9 15.5 1.3 21.4 21.0


Controlling processing from using the cooperative model is not the only method ofvertical integration. Aquaculturalists would be wise to consider purchasing retailestablishments, such as fish market or purchasing interest, owing and/or operating arestaurant, clamshack, etc. By vertically integrating in this manner, they are assured thatthere will always be a market for their products and they make the profits enjoyed by theretail operation in addition to their farming profits. Again, this strategy is not new toagriculturalists. Small and medium-sized farms throughout the U.S. operate their ownfarm stands to increase profits.

The key is to not get locked into or become reliant on one distribution channel. Multiplechannels of distribution allow aquaculturalists to make higher profits. One shellfish farmin Massachusetts sells its product to local restaurants and direct to consumer throughthree distribution channels (raw bar, catering (clam bakes) and operating a weekendresort restaurant on their property). By expanding distribution, the grower has becomeless reliant on any single method of distribution.

The Fulton Market in New York City follows this diversified strategy. The bulk of theirsales go to seafood markets for resale, restaurants and wholesale distributors. Processorsand consumers make up a small share of their distribution channel.

0% 10% 20% 30% 40% 50%

Seafood Markets

Restaurants / Food Service

Wholesale Distributors

Business Outside N.Y.

Processors

Consumers

Sales Destinations of Seafood Sold from Fulton Market


The distribution chain for seafood products can be very convoluted including a number ofmiddlemen each of whom needs to take a percentage. This adds significantly to the pricespread between farmer and end-user. An effective strategy for the small and medium-sized grower is to shorten the distribution chain and target those segments that providethe greatest return�—the consumer or the restaurant user.

The final concern in distribution is packaging. Given the perishability of the product(generally a fresh shelf-life of seven days or less), the problem becomes one of how toextending this limit safely. Additional concerns exits regarding the best options forpackaging given Hazard Analysis Critical Control Point (HACCP) standards and the needto live-haul many of the region�’s aquaculture products. Current packaging practices arenot as effective as past packaging practices in keeping the product fresh. Research isneeded in this area and export opportunities are limited until the packaging dilemma isresolved.

PROMOTION

Promotion from a marketing perspective consists of four interrelated activities: Salespromotion (coupons, specials, etc.), advertising, personal selling and publicity/publicrelations. Most people equate marketing with sales or advertising, two of the sub-areas ofpromotion when in fact, marketing strategy�’s focus is on managing the relationshipbetween product, price, place (distribution) and promotion to meet consumer needs.

Regardless of whether growers are focusing on promotion, you can be assured thatsomeone in the marketing channel is. Promotion is how we inform potential consumers ofthe benefits of selecting our products, the quality (or perceived quality) of our products,how we match up against the competition (positioning), how to identify and request ourproducts (branding), and how to purchase our products

An example of how important promotion is to aquaculturalists can be found in thebranding efforts of oysters. Four oyster species (eastern oyster, western oyster, Europeanor belon oyster and Kumamoto oyster) are widely available on the half-shell in the U.S.,but there are many attempts at branding including: Blue Point, Wellfleet, Fisher�’s Island,Moonstone, Malpeque, Pemaquid, Peconic Bay, Shinnecock, Bay Shore, RaspberryPoint, Buzzard�’s Bay, Spinney Creek, Atlantic Cape, Saltaire, Montauk, Beausoleil,Brewsters Cup, Bristol Harbor, Newport Cup, Cape Blue, Chedabucto, Chincoteague,Cuttyhunk, Duck Island, Fox Island, Glidden Point, Island Creek, Matinecook,Narragansett, Tatamagouche, Watch Hill, Westkeag, Canadian Cove, Cape Ann,Falmouth, Bras d�’Or, Aquindeck, Chilmark, Cotuit, Damariscotta and Pickle Point. TheBlue Point name is protected by New York State law �– to be called blue points, the oystermust spend at least three months in the Great South Bay on the southern coast of LongIsland. (Moskin, 2002). Even with this attempt at differentiation through branding, thereare often negative perceptions that need to be overcome with East Coast oysters.Generally consumers perceive that if product comes from someplace else, it must besafer. What is needed, obviously, is some promotional effort to position the northeast


produced products in the minds of consumers as their �“preferred�” products based uponattributes that are salient to the consumers (in this case, perceived safety).

Large producers are fighting for this recognition as a means of repositioning themselvesvis-à-vis imported aquacultural products. Last year the Catfish Farmers of America ranan advertisement that read: �”Never trust a catfish with a foreign accent. They�’ve grownup flapping around in Third World rivers and dining on whatever they can get their finson�” (Chapman, 2002). And exporters and commercial fishing associations have joinedthe fray. Norwegian salmon farming industry launched a major public relations campaignto create a more positive image for its products. Likewise, Alaskan fishermen havelaunched a major public relations campaign to get consumers to �“go wild�” (Wilkinson,2003).

As with distribution, vertical integration (in this case, cooperation) is one of the keys tolong-term success. Producers should continue to scan the horizon looking for the next bigtrend (i.e., �“orange roughy�” in the past or possibly Atlantic Char in the future) anddevelop campaigns to introduce the product into the marketplace with the assistance ofmembers of the distribution channel. Some academic research already exists in this area.Leek et al. (1998) wrote an article detailing how to concept test unfamiliar fish anddocumented their experience doing so in the U.K.

Promotional cooperation is also essential with restaurants. In a recent article in FoodManagement details six ways to net more seafood sales: 1. Focus on fresh, 2. Offer aseafood bar, 3. Ride the sushi wave, 4. Make use of old standby, 5. Handle with care, and6) Use global inspiration (Sheehan, 2003). By remaining innovative and identifyingglobal trends not yet enjoyed in the local market, aquaculturalists can broaden theirproduction, thus diversifying their risks by remaining less reliant on one species orproduct.

One of the fallacies of promotion, however, is the relationship between advertising andsales. Aquaculturalists need to be cautioned that no direct linear relationship existsbetween advertising dollars spent and sales. In fact, for a particular grower, therelationship between advertising and sales may not become apparent for many years.What is known is that it is better to use promotion than to not use promotion. Forinstance, successful branding initiatives require a consistent commitment (long-term) toadvertising. Slow and steady should be the rule for those considering promotion.

Popular promotion vehicles for the industry include tradeshows and chef events, bothfocused on increasing sales by developing relationships with distribution channelmembers.


Aquaculture Product Trends

Atlantic Salmon

Farm-raised salmon has gained increased popularity for both home consumption and foodservice use. Consumer acceptance was accelerated by declining prices as a result of overproduction and decreasing production costs within the aquaculture sector. Readyavailability of bone out fillets also fired increased sales. It is interesting to note thatalthough prices have decreased and this is clearly visible at retail, many restaurants havecontinued to charge a premium price for a salmon entrée. For a small grower, the localrestaurant market may provide the most lucrative returns.

To distinguish themselves from the competition and grow their businesses, someproducers have established vertically integrated operations in which they not only processthe fish but also produce a range of value-added products. A product that is gainingincreasing popularity at retail is the portion controlled salmon fillet. In some stores, theproduct is sold by the piece, usually a six-ounce fillet, for $1.99. This strategy gives theconsumer the perception that the price is low when it is actually over $5.00 per pound.Chile has shifted the majority of its production away from whole fish and into the value-added fillet category. This shift may be attributable to changing consumer preferences(usually consumers prefer a boneless product) or to the post 9-11 spike in freight costs.

In early 2002, the World Trade Center in Alaska sponsored a forum to gain anunderstanding of why Costco (a major U.S. warehouse store) prefers to purchase Chileansalmon as opposed to Alaskan wild-caught product. Costco buys about 600,000 poundsper week of fresh Chilean farm-raised salmon. According to Costco, the principaladvantage of farmed fish is that it is available year round, at a consistent and controlledlevel of quality allowing companies to build marketing programs and confidently expandtheir purchases year after year with falling prices. The last item is critical to consider inany marketing scheme. How low will the price go as supply increases? At what pricepoint is it impossible for the grower to make a profit? Because of the current low price,farm-raised salmon can be used as substitute for meat and poultry. When Costco sellsAlaskan wild-caught salmon it is a special promotion. This same promotional strategycan be used for locally farm-raised products. The strategy is to promote the product asbeing something special that is available only in limited quantities for a specific period oftime.

Chilean salmon imports have successfully maintained their price structure while locallyproduced salmon prices have declined. Chilean salmon production continues to rise andgain market share in the U.S. while domestic salmon production is flat. Product flow intothe market is also timed to avoid periods of low demand and low price such as Octoberthrough January.


World Farmed Salmon Production 2000

Country Metric Tons 2000 Percent World ProductionNorway 420,000 41%Chile 245,000 24%U.K. 178,000 17%Canada 75,000 7%Other 75,000 7%U.S. 18,000 2%Japan 12,000 1%Total Production 1,023,000

By even the most favorable estimates, all projections point to a major oversupply ofsalmon by 2010. It is difficult to project how much additional promotional and marketingefforts will contribute to an increase in demand. Given the high level of governmentsupport in Norway and Chile contrasted with the lack of government support for farmedsalmon promotion in the United States, it is doubtful that the U.S. can continue tocompete effectively in the broader general market.

Plus, there is a definite bias among American chefs who view fresh Norwegian salmon asa better quality product that other salmon largely as a result of an aggressive government-supported promotion program. Similar biases exist for smoked salmon, with Scotlandidentified by chefs as the perceived best source of this product. Many foreign producersof salmon have clearly identified their product as being environmentally friendly andhave capitalized on place locations that seem pristine and wild.

Some companies and countries are using �“guerilla�” marketing techniques to promotetheir products. The Norwegian Seafood Export Council (NSEC) sent packages of frozensalmon products to approximately 1,000 U.S. foodservice and food distributioncompanies. Many chefs actually believe that Norwegian farm-raised salmon is a distinctproduct and is of higher quality than other farm-raised Atlantic salmon. Namerecognition plays into pricing structures. The Norwegians are now actively promotingtheir fjord-raised trout at culinary contests as a means of gaining recognition with chefsworldwide.


World Salmon Supply/Demand Forecast(1,000 Metric Tons)

Consumption Japan U.S. Europe Other Total1996 516 190 233 316 1,2552010 IndustryEstimate

1,169 430 529 404 2,532

2010 PopulationEstimate

596 427 328 404 1,755

Production Norway Chile Scotland Other Total1997 AtlanticSalmon

310 95 90 105 600

1997 FarmedCoho/Chinook

75 51 106

1997 Wild Harvest 820Total 1997 Supply 1,526

2010 ForecastAtlantic Production

843 654 216 1,920

2010 Forecast OtherFarmed

300

2010 Wild 8202010 ForecastSalmon Supply

3,040

Data Source: International Salmon Farmers Association

Monthly Wholesale Price Per PoundFarmed Atlantic Salmon 6-8 Pound

Northeast USA Production

1995 1996 1997 1998 1999 2000Jan. $2,30 $2.10 $1.88 $2.12 $1.94 $2.04Feb. 2.55 2.10 1.99 1.97 2.19 2.18Mar. 2.40 2.25 2.04 1.86 2.39 2.44Apr. 2.60 2.55 2.34 2.27 2.42 2.41May 2.55 2.65 2.32 2.41 2.50 2.50June 2.75 2.50 2.35 2.33 2.39 2.49July 2.60 2.10 2.37 2.33 2.30 2.28Aug. 2.50 2.40 2.34 2.34 2.28 2.12Sept. 2.40 2.15 2.11 2.35 2.19 2.04Oct. 2.35 1.90 2.09 2.11 2.11 1.86Nov. 2.45 2.00 2.02 2.05 2.01 1.93Dec. 2.30 1.90 1.89 1.94 2.00 1.99

Data Source: NMFS


Monthly Wholesale Price Per PoundFarmed Chilean Atlantic Salmon

6-8 Pound

1995 1996 1997 1998 1999 2000Jan. $2.25 $1.98 $1.85 $2.19 $2.18 $2.24Feb. 2.35 1.98 1.96 1.96 2.12 2.28Mar. 2.05 2.06 1.98 2.01 2.36Apr. 2.45 2.29 2.27 2.27 2.45 2.38May 2.25 2.35 2.33 2.43 2.38June 2.50 2.16 2.26 2.40 2.36July 2.30 2.04 2.10 2.30 2.30Aug. 2.45 2.06 2.03 2.24 2.22Sept. 2.20 1.81 1.97 2.26 2.28 2.20Oct. 2.00 1.85 1.90 2.06 2.25Nov. 2.05 1.91 1.86 2.02 2.20Dec. 2.05 1.94 1.78 2.08 2.20

Data Source: NMFS

Monthly Wholesale Price Per PoundAtlantic Salmon Fillets

1994 1995 1996 1997 1998 1999 2000Jan. $3.25 $3.00 $2.95 $3.35 $3.28 $3.28Feb. 3.50 3.10 3.00 3.00 3.48 3.25Mar. 3.20 3.10 3.15 3.05 3.63 3.52Apr. 3.65 3.25 3.05 3.35 3.62 3.49May 3.95 3.30 3.35 2.85 3.35 3.65 3.28June 4.00 3.55 2.70 2.80 3.50 3.24 3.01July 3.90 3.35 2.70 2.80 3.50 3.24 3.01Aug. 3.75 3.65 3.25 3.05 3.20 3.31 3.05Sept. 4.25 3.30 2.95 2.95 3.40 3.24 2.91Oct. 3.75 2.85 2.65 2.65 3.00 3.13 2.79Nov. 3.60 3.10 3.00 2.80 3.10 3.16 2.51Dec. 3.45 2.90 3.10 3.05 3.25 3.29 2.52

Data Source: NMFS


FARMED ATLANTIC SALMON IMPORTSNew York Customs District

January-November 2002

Product Country Kilos US DollarsFresh Fillets Canada 29,701 234,830Fresh Fillets Chile 4,919,987 19,668,798Fresh Fillets Faroe Islands 16,234 19,980Fresh Fillets Iceland 53,271 392,912Fresh Fillets Norway 1,198,058 4,899,548Fresh Fillets Uganda 1,988 11,888Fresh Fillets United Kingdom 149,450 580,423Frozen Fillets Chile 2,309,333 8,603,547Frozen Fillets China 4,536 12,000Frozen Fillets Norway 236,056 1,851,585Fresh Canada 1,514 10,329Fresh Chile 165,648 483,752Fresh Faroe Islands 256,585 494,018Fresh Iceland 49,094 139,709Fresh Ireland 65,930 211,658Fresh South Africa 2,469 4,552Fresh United Kingdom 2,905,094 6,600,588

Data Source: NMFS

As illustrated by the chart below, both the production volume and the sales volume ofsalmon have been increasing over the past six years. But as discussed earlier, supply willexceed demand by 2010.

Salmon

050000

100000150000

1995 1996 1997 1998 1999 2000

Year

Thousand lbs.Thousand $

Data Source:NMFS


Arctic Char

Farm-raised Arctic char appeals to the restaurant sector. The natural pathway for theintroduction of new-to-market species is at the restaurant level followed by penetrationinto the retail sector. Chefs in the area have tried the product and been favorablyimpressed. However, they�’ve had difficulty in sourcing the product. If they could beassured of a steadier supply, many have expressed an interest in making Arctic char aregular part of their menu. Once Arctic char production expands, this problem should beeasily overcome. However, Canada is actively targeting sales into the region. Retailershave expressed similar concerns. Arctic char is a good product and can easily be sold butthey are unwilling to make the commitment of promoting a product to their customers ifthey cannot source it on a regular basis.

Baitfish

Currently, there is no standard method for distinguishing between wild harvested andcultured baitfish. A second consideration when looking a statistics is the variety ofcommon market names that makes it difficult to determine exactly which fish is beingconsidered.

Bait production represents a major opportunity for small and medium-sized growers inthe region. According to the 1998 Census of Aquaculture, there were 62 farms producingbaitfish in the region. It is difficult to determine whether these were actually aquaticfarms or simply facilities that hold and grow-out wild caught fish. Maine (28 farms) andNew York (14 farms) had the most production. Most of these were small operations thatcould be expanded. Forty farms were producing golden shiners (Notemigonuscrysoleucas) and 31 farms produced fathead minnows (Pimephales promelas).

United States baitfish culture has been largely concentrated in states that do not havestringent regulatory policies and where the growth of aquaculture has been nurtured. Thesouthern region had 104 farms producing $27,078,000 in sales value. Arkansas dominatesthe market with 62 farms and a sales value of $22,973,000. The north central region has92 farms producing $6,421,000 in sales. Although the northeast has a large number offarms, production on those farms is low.

Shortages of baitfish in several states (Illinois, Michigan, Minnesota, Ohio, South Dakotaand Wisconsin) in the north central region were reported in several surveys (Meronek etal., 1997). Seasonal variations in demand play an important part in this market. Theseshortages are particularly pronounced during the winter when wild harvest in colderclimates is impeded by ice.

Baitfish is sold many times before they reach the end user. The wholesale price increaseswith each step. Prices of baitfish vary by species, time of year, state, production method(wild harvest vs. culture), size and supply. The 1999 farm gate price of Arkansas goldenshiners was $3.25/pound while the wholesale price was $7.00/pound. It is difficult to


assess the retail price because baitfish is generally sold by the dozen. An effective way toaddress this market is to shorten the distribution chain.

Species propagation includes golden shiner, fathead minnow and goldfish (Carassiusauratus). Fathead minnows are in highest demand in the Midwest and Northeast. Goldenshiners find the best markets in the Southeast, Southwest and West. White suckers(Catostomus commersoni) are also an important baitfish.

A strong distribution network is already in place and new to market growers might findsome difficulty in entering the network. However, because of the nature of the product,there are a variety of opportunities for selling in smaller quantities to local bait shops andother outlets.

In addition to serving bait markets, these fish can also be used as feeder fish. Thisdemand is growing as hybrid-striped bass culture grows. Tilapia is another product thatcan fit into the feeder category. In the latter case, raising a smaller feeder fish decreasesthe cost of production and minimizes mortality risk.

An assessment of seasonal and regional market demand is necessary to determine whichproducts to bring to market and in what quantities. Another important consideration is thedemand is often based upon fish size. Three size grades of fathead minnows and four ofgolden shiners are commonly marketed. There is some indication that the Northeastdemand for golden shiners at the 3-inch or larger range is in excess of what is currentlybeing produced. Potential growers should also investigate opportunities outside of theregion. Shipping has become much easier and because of shifting demands for baitthroughout the season, there may be potential opportunities.

Local production may also result in a better quality product that can command a higherprice. Potential growers should also investigate various state regulations regardingdistribution. Prohibitions on interstate shipping may open opportunities. Again, this maypresent an opportunity for the local grower.

Another consideration is which species will successfully over-winter. Fathead minnowstend to have a good winter survival. They are commonly used as bait for crappies andtrout.

Polyculture systems have been used on small farms. Minnows can be used as forage forcatfish and some minnows can be sold off as bait. Similar strategies can be used at feefishing operations, where both bait and target species can be raised. Excess productioncan be sold to other outlets.

Aquacultured baitfishes have a number of advantages over wild harvest including theopportunity for size grading and the production of a better quality, hardier fish.

Most baitfish culture is extensive and additional research would be required to establishintensive systems. It is estimated that over a season, a ten-acre production facility can


produce 2,500 pounds of fat head minnows. Some variants such as rosy red willcommand a higher price in certain markets.

Potential opportunities in the northeast region include the production of saltwater baitfishand bait such as small spots and sea worms. Baitfish production can be a good sideactivity for fee-fishing operations and an example of vertical integration.

On a national level, both production and price of baitfish has been on the decline.

Baitfish

01000020000300004000050000600007000080000

1995 1996 1997 1998 1999 2000

Year


Biotechnology

Although there are some possible applications in the area of pharmaceuticals, it is mostlikely that natural marine compounds will be identified and then synthesized. There maybe some opportunities in the area of nutriceuticals and cosmetics that could be furtherexplored. Several companies have been successful in capturing the market for chlorella.

Catfish

Catfish continues to be the largest segment of aquaculture in the United States.Production is largely limited to southern states that have actively fostered thedevelopment of the industry. Over the past twenty years, the product has gained anational reputation largely because it can be sold as a white, mild-tasting, boneless filletis the preferred finfish product in the U.S. market. State governments have facilitated thedevelopment of cooperatives and marketing organizations that provide verticalintegration, research and development, as well as active market expansion.

As production expanded, there was a need to seek new markets to absorb the supply.This created added marketing expenses. Frozen inventory continues to build. The


potential for oversupply is further exacerbated by inexpensive basa imports from VietNam. This product is often sold under the name catfish and resulted in decreases in salesof domestically grown and processed product. Although the catfish industry has beenactively involved in legal battles to require appropriate nomenclature for basa, it has beena difficult and costly process.

Catfish Imports Northeast and Mid-Atlantic Customs DistrictsData Cumulative January through May

Product Country 2002kilos

2002Value

2003kilos

2003Value

Catfish Fillet Frozen Canada 9,294 $59,760 0 0Catfish Fillet Frozen China 0 0 20,582 $81,901Catfish Fillet Frozen Viet

Nam97,842 $323,536 310,669 $864,123

Catfish Fillet Frozen Guyana 5,847 $16,215 0 0Catfish Fillet Frozen India 0 0 1,973 $5,616

Grand Total 112,983 $399,511 333,224 $1,389,996 Data Source: NMFS 2003

Even with increased foreign competition, both the domestic catfish output and theindustry�’s level of sales have increased over the past six years. If growers can repositionthemselves against foreign competition on variables other than price, the domestic catfishindustry will remain viable.

Catfish

0200000400000600000800000

1995 1996 1997 1998 1999 2000

Year



Hybrid Striped Bass

Despite being one of the more popular finfish for aquaculturists to grow, littleinformation exists regarding the U.S. striped bass market. Growers exist throughout thenortheast region, and demand, sales and prices are increasing. Commercial fisheries fortrue striped bass (Morone saxatalis ) have remained closed in many states and it was feltthat this market niche could be filled with hybrid striped bass production.

Originally it was believed that hybrid striped bass would find easy market acceptance.However, there have been some problems. Many restaurateurs and food critics view it asbeing less flavorful and less desirable than its wild cousin. A number of states requirespecial marking for the fish and this adds to the cost of production. Problems have alsoarisen with environmental groups since the fish feeds on animal protein.

Striped Bass

010000200003000040000

1995 1996 1997 1998 1999 2000

Year


Data Source: NMFS 2001

U.S. Catfish Production

0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

year

Mill

ion

Poun

ds

Processor SalesPond Sales


!"#$%&'()$(*&%)+$#,(-.+/012)+$!"#$%&'()$(*&%)+$#,(-.+/012)+$

#$/(3#,&'(+4(567.)/(32.)8&/(9#''#$/(3#,&'(+4(567.)/(32.)8&/(9#''

!"#$%&'($!"#$%&'($ )*+)*+,,-$.'/$*0-$.'/$*0 1"2$%&'($1"2$%&'($ 3&($443&($44 5"$'.445"$'.44

67786778

9#&(%4:9#&(%4:.;.;<< =>7?777=>7?777 6?8>7?7776?8>7?777 6?@AB?7776?@AB?777 C?7B@?777C?7B@?777 @?D8=?777@?D8=?777

E*F&4:E*F&4:.;.;<< 67=?77767=?777 >A7?777>A7?777 D?777D?777 ACA?777ACA?777 8?7DB?7778?7DB?777

5"$'.4:5"$'.4:.;.;<< D>=?777D>=?777 6?=D7?7776?=D7?777 6?@C>?7776?@C>?777 C?C66?777C?C66?777 87?@7A?77787?@7A?777

67766776

9#&(%4:9#&(%4:.;.;<< >@7?777>@7?777 8?=@6?>778?=@6?>77 6?88@?7776?88@?777 C?A8B?777C?A8B?777 D?B8D?>77D?B8D?>77

E*F&4:E*F&4:.;.;<< C>C?777C>C?777 @=7?777@=7?777 D?777D?777 AC@?777AC@?777 8?BB8?7778?BB8?777

5"$'.4:5"$'.4:.;.;<< 8?7CC?7778?7CC?777 6?=>6?>776?=>6?>77 6?86B?7776?86B?777 C?===?777C?===?777 87?CD@?>7787?CD@?>77

G%'/H&G%'/H&

9#&(%4:9#&(%4:.;.;<< ,,=7?777=7?777 ,,C>B?>77C>B?>77 ,,D8D?777D8D?777 6AD?7776AD?777 ,,8?7@B?>778?7@B?>77

E*F&4:E*F&4:.;.;<< 6CD?7776CD?777 CA7?777CA7?777 77 =?777=?777 =DC?777=DC?777

5"$'.4:5"$'.4:.;.;<< 8DD?7778DD?777 ,,6B?>776B?>77 ,,D8D?777D8D?777 6CC?7776CC?777 ,,C8A?>77C8A?>77

66I66I ,,8I8I ,,6DI6DI =I=I ,,CICI

J/0#&'(&J/0#&'(&

K&0#&'(&K&0#&'(&

!"#$%&"'(")*%+,-.,-'$/,#!"#$%&"'(")*%+,-.,-'$/,#0'$'%1-,2%3$'$"%456')67$6-"%89$"#3/,#%:-,;-'23%'#<%'%36-=">%,1%20'$'%1-,2%3$'$"%456')67$6-"%89$"#3/,#%:-,;-'23%'#<%'%36-=">%,1%2'?,-%.-,<6)"-3%'?,-%.-,<6)"-3%

Data Source: Carlberg and Van Olst (2003)


Initially, almost all production of hybrid striped bass took place in tanks. By 1999,production was equally split between tanks and ponds. Since 2000, more hybrid stripedbass are grown in ponds than using any other method.

Total production in 2002 was four percent lower than in 2001, with sales of fresh fishdown 11 percent and sales of live fish up 63 percent (Carlberg and Van Olst, 2003).According to Kent Sea Tech, demand in the northeast exceeds supply, creatingopportunities for other regions to sell product here, or for local producers to increaseproduction.

Hybrid Striped Bass Price Fulton Fish Market January 2002-December 2002State Jan Feb Mar Apr May June July Aug Sept Oct Nov DecFL $2.75 $2.65 $0.00 $2.75 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00MS $2.75 $2.75 $2.75 $2.75 $2.75 $2.75 $2.75 $2.75 $2.75 $2.75 $2.75 $3.00

TILAPIA

Tilapia Prices Fulton Fish Market January 2002-December 2002

Jan Feb Mar Apr May June July Aug Sept Oct Nov DecFl $1.00 $1.10 $1.03 $0.98 $0.88 $0.86 $1.08 $1.00 $0.93 $0.90 $0.91 $0.91

Fresh tilapia fillets were imported into the New England and Mid-Atlantic CustomsDistricts for an average price of $1.91 per pound in 2002 and $2.12 per pound in 2003.Frozen fillets were brought in at $1.75 per pound and $1.71 per pound during the sameperiod respectively. It can be anticipated that the volume of imports will continue toincrease. Fresh fillets went from 38,347 kilos in 2002 to 175,981 kilos in 2003 in theMid-Atlantic District while imports in New England decreased from 32,836 kilos in 2002to 2,273 kilos during the same period in 2003. Whole frozen fish were imported at $0.51in 2002 and the price rose to $1.21 in $0.55 in 2003 in the Mid-Atlantic District. Datacalculations are based on the period from January through May in 2002 and 2003.

This price structure makes it increasingly difficult to compete without a specific marketadvantage.


Tilapia Fillets, 5-7 ounce Taiwan/Indonesia

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

Jan

Feb Mar AprMay Ju

ne July

AugSep

tOct Nov Dec

Month

Dol

lars

per

Pou

nd

20012002

Tilapia Fillets, 7-9 ounce Taiwan/Indonesia

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

Jan

Feb Mar AprMay

June Ju

lyAug Sep

tOct

Nov Dec

Month

Dol

lars

per

Pou

nd

20012002

A two-year comparison of prices for tilapia imports clearly shows how the prices haveleveled off and remained constant. This price structure makes it increasingly difficult forNortheast producers to compete. The major opportunity for the Northeast industry is inthe sale of live fish to ethnic markets. The pricing pattern experienced by tilapia is similar


to those for other aquacultured products. As production increases, prices drop andstabilize.

However, tilapia enjoys expanded appeal in the U.S. market with both volume (inpounds) and sales have increased over the past six years. And tilapia responds well topolyculture efforts.

Tilapia

010000200003000040000

1995 1996 1997 1998 1999 2000

Year



TROUT

As a salmonoid, trout has enjoyed an increase of sales because of the popularity ofsalmon. Some trout fillets (especially steelhead) is almost indistinguishable in looks fromAtlantic salmon. With natural trout habitats declining as a result of pollution anddevelopment, trout farming has increased in importance. Opportunities exist in fee-fishing and sport-fishing operations for trout. Private trout clubs and ponds already exist,with members paying for what they catch per pound. And recipes like trout almandinecontinue to stress the allure of this easy to prepare species. Finally, trout have the addedbenefit of being easier to clean/process because of their lack of scales.

Trout Prices Fulton Fish Market-January 2002-December 2002

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

IDboned

$3.01 $3.00 $3.00 $3.04 $3.10 $3.10 $3.16 $3.10 $3.10 $3.10 $3.10 $3.10

Drn:8-14oz.

$2.50 $2.50 $2.50 $2.50 $2.50 $2.50 $2.50 $2.50 $2.50 $2.50 $2.50 $2.50


Trout

020000400006000080000

1995 1996 1997 1998 1999 2000

Year



While domestic production levels and prices have remained flat for the past six years,demand has nearly doubled for imported trout. Given the cold, clear waters of thenortheast region, trout farming represents a real opportunity for aquaculturalists.

Farmed Rainbow Trout ImportsNortheast and Mid-Atlantic Customs DistrictsData is cumulative from January through May

Product Country 2002Kilos

2002Value

2003Kilos

2003Value

Farmed Rainbow TroutFresh

Canada 18,200 $75,181 34,192 $134,754

Farmed Rainbow TroutFresh

Iceland 0 $0 998 $2,914

18,200 $75,181 35,190 $137,668

CRAWFISH


Crawfish

020000400006000080000

1995 1996 1997 1998 1999 20000

Year



Crawfish prices have declined over the past couple of years because of the glut ofimports, mostly from China. Crawfish offer good polyculture and baitfish opportunities.Crawfish shed their shells each year and softshell crawfish are one of the best bass baitson the market.

However, focusing only on farming crawfish is a risky if not unprofitable propositionwhen targeting the consumer food segment, especially in the northeast. Without question,the largest market for consumable crawfish in Louisiana. Although trendy in the 1980�’s,demand for crawfish in the northeast remains low.

Hard Clams

For centuries, hard clams have been a mainstay of the wild harvest fisheries in theNortheast. Although, many more acres are now devoted to the production of culturedclams, the industry has faced severe market challenges. Less expensive products fromsouthern states have been rapidly eroding local markets. Mahogany clams (Arcticaislandica) have been displacing product in the market. Although the marketing studyconducted by Barnes et al. (2003), indicates that consumers in the northeast candistinguish among clam products, there are some questions about whether the broadermarket can make such distinctions.

Many clam farmers, especially in the Mid-Atlantic region sell directly into Fulton FishMarket. The 9-11 tragedy disrupted the market and many local farmers have notrecovered.

In order to sell clams directly to restaurants and consumers, clammers generally needadditional licenses. These licenses are often dependent upon having a fully equippedprocessing/packing facility and Hazard Analysis Critical Control Point (HACCP)certification. Size restrictions which vary from state to state, even for farm-raisedproducts, have hampered sales in the region.

During the period from 1991 to 2001, the price for clams in the Fulton Fish Market inNew York City traded within a very narrow range when adjusted for the producer price


index. Adjusted prices ranged from a low of $38.95 to a high of $65.58. Unfortunately,the high was achieved in 1991. More recently, clam prices in the market for 2003 havebeen depressed between 10 and 20% over the same period last year

Top Neck and Neck Clam Prices ($US)Fulton Fish Market

2002

State Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

Ct 200ct 46.07 41.18 45.00 45.00 47.00 45.00 0.00 0.00 43.75 0.00 0.00 0.00Ct 400ct 86.43 85.53 95,83 97.25 102.61 96.81 97.50 94.31 93.75 88.16 90.00 91.62Fl 400ct 73.33 71.43 71.00 69.44 70.00 70.00 69.67 69.10 68.71 68.14 66.89 66.75MA 200ct 37.83 35.83 40.00 43.00 38.75 42.50 44.09 43.25 47.00 42.43 40.00 46.89MA:400ct 80.00 80.00 0.00 95.00 95.00 0.00 96.67 90.00 0.00 83.33 82.50 91.67NC 200 ct 45.00 0.00 38.67 38.00 45.50 40.00 0.00 42.00 0.00 0.00 40.00 47.50NC 400ct 74.50 0.00 75.00 75.00 80.63 0.00 0.00 82.33 0.00 0.00 0.00 0.00NJ 200 ct 35.00 36.82 40.00 40.57 46.61 45.00 45.00 43.03 45.89 42.11 40.38 47.82NJ 400 ct 75.00 80.83 85.00 82.42 91.94 87.12 86.54 85.18 93.50 84.67 80.77 89.23NY200ct 40.25 40.00 0.00 0.00 0.00 0.00 0.00 40.00 40.00 0.00 0.00 45.00NY 400ct 83.53 85.53 95.88 97.38 102.38 97.00 97.74 94.88 94.08 90.00 90.00 92.35RI 200 ct 0.00 0.00 0.00 0.00 0.00 45.00 0.00 0.00 0.00 0.00 0.00 0.00RI 400ct 79.32 85.83 95.12 97.38 101.81 97.01 97.62 94.88 94.08 90.15 90.00 92.35VA 200ct 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 55.00VA 400ct 80.00 71.00 80.00 75.00 92.50 85.00 0.00 0.00 0.00 0.00 0.00 77.50

On a national level, both production and industry sales have increased over the past sixyears. As wild harvest clamming declines, aquacultured clams become more important.Shellfish aquauclture has been identified as one of the �“acceptable�” forms of aquaculturebecause it causes minimal impact and may even be beneficial to the environment.

Clams

0200004000060000

1995 1996 1997 1998 1999 2000

Year


Wellfleet shellfish expects to be selling 5 to 10 million clams annually by 2004 �– mostlyin New York, Philadelphia, Washington, Atlanta and Chicago (Rivard, 2003).


MUSSELS

Mussels have become increasingly popular at both foodservice and retail outlets. A majordifficulty is that many retailers, especially supermarkets, do not handle the product well.Pre-packaged product will eliminate some of the problems that are encountered whenretail associates over-wrap packages. Handling instructions for both retailers andconsumers may extend shelf-life and improve customer satisfaction. Prepackaged livemussel products dominate the market. Approximately 86% of all mussels producedworldwide are farmed. Frozen products including mussels in sauce and appetizers arebecoming increasingly popular. A major difficulty encountered with these products is thehigh cost of getting shelf space in supermarket chains.

Market share for mussels in the New York metropolitan market has increaseddramatically during the past twenty years. In some stores, mussels were a give-awayalong with a seafood purchase. The rise in sales can be partially attributed to some veryaggressive marketing and promotion programs aimed at supermarkets.

Due to the increased volume of mussel imports, prices of domestic aquacultured musselsare declining. As illustrated in the trend graph below, prices and demand increaseddramatically in 1996 only to decrease rapidly in the following four-year period.

Mussels

0200040006000

1995 1996 1997 1998 1999 2000

Year



Mussel ImportsNew York Customs District


Product County Kilos USDollars

Frozen/Dried/Salted/Brined Chile 82,615 214,296Frozen/Dried/Salted/Brined China 24,949 82,454Frozen/Dried/Salted/Brined Denmark 3,468 11,709Frozen/Dried/Salted/Brined Hong Kong 3,798 16,709Frozen/Dried/Salted/Brined Ireland 2,500 5,197


Frozen/Dried/Salted/Brined Netherlands 1,573 4,882Frozen/Dried/Salted/Brined New

Zealand1,936,375 6,124,492

Frozen/Dried/Salted/Brined Thailand 4,029 20,324Subtotal 2,059,307 6,480,063

Live/Fresh/Wild China 11,864 56,430Live/Fresh/Wild New

Zealand218,858 731,163

Live/Fresh/Wild Thailand 1,280 14,400Subtotal 232,002 801,993

Grand Total 2,291,309 7,282,056 Data Source: NMFS

OYSTERS

Shell oysters command a wide range of prices in Fulton Market depending upon whetherthey are wild or cultivated. The average price for 200 count, cultivated oysters fromConnecticut in 1999 was $80.00. During that same time period, 100 count wild oystersfrom Louisiana, Texas, Mississippi, and Virginia had an average price of $20.00.Cultivated 100 count oysters from Long Island, N.Y. had an average price of $38.00.

Shucked select oysters during that time period were selling for $60.00 USD per gallon.Clearly there is an advantage to selling smaller cultivated oysters from a location with areputation for high quality product. An added advantage is having a product with distinctname recognition that can be promoted in upscale restaurants and retail establishments.

As stated before, four oyster species (eastern oyster (Crassostrea virginica), westernoyster (Cassostrea gigas) , European or belon oyster (Ostrea edulis), and Kumamotooyster (Crassostrea sikamea) are widely available on the half-shell in the U.S., but thereare many local names such as wellfleets, bluepoints, chincoteagues, etc. that are morefamiliar to the public.

Numerous restaurateurs and caterers have expressed a clear interest in frozen half shellclams and oysters as a mechanism to help ensure the safety and quality of the product.Some of the concerns raised by these individuals are the difficulty in finding professionalshuckers who can provide a well presented product, the need to have a large number ofshellfish ready at one time for large functions and safety issues especially the potentialfor temperature abuse. This may present an opportunity for processing cooperatives thatcan bring larger volumes of product to the marketplace.

There is also interest in the high-pressure systems that can reduce some of the bacterialload in the product and help ensure a safer product. Another potential market opportunityis identifying periods during the year when there are real or perceived concerns about thesafety of the harvest from warmer waters. California has been in the lead in this areabanning imports of Louisiana oysters. A naturally-occurring bacteria, Vibrio vulnificus,


can be problematic during warmer periods. Oysters harvested from colder water may beof better quality and potentially may be safer.

Only those countries that have memoranda of understanding with the United States canship live oysters into the market. Currently those countries are Canada, Chile, Mexico,South Korean and New Zealand. There may be some opportunity for small growers toexport product provided that they have the appropriate health documentation in place.This is a good opportunity for the small grower since it requires small air shipments.


0

10,000

20,000

30,000

40,000

50,000

Mea

t Wei

ght (

000

lbs.

)

Year

United States Oyster Supply1991 - 2001

Imports 30,5 26,5 28,2 24,6 24,2 21,7 20,5 29,5 30,0 17,7 18,3U.S. Harvest 31,8 36,1 33,5 38,0 40,3 38,0 39,6 33,5 26,9 41,1 32,6

199 199 199 199 199 199 199 199 199 200 200

Data Source: NMFS

Oyster ImportsNew York Customs District


Product Country Kilos Dollars

Canned China 12,519 37,950Canned Japan 2,974 28,610


Canned South Korea 68,193 217,341Subtotal 83,686 283,901Canned Smoked China 30,953 138,318Canned Smoked South Korea 138,949 804,729Subtotal 169,902 943,047Farmed-Live/Fresh/Frozen/Dried/Salted/Brined China 748 8,746Farmed-Live/Fresh/Frozen/Dried/Salted/Brined Japan 721 6,750Farmed-Live/Fresh/Frozen/Dried/Salted/Brined South Korea 67,163 312,474Subtotal 68,632 327,970Wild-Live/Fresh/Frozen/Dried/Salted/Brined Canada 1,200 5,445Wild-Live/Fresh/Frozen/Dried/Salted/Brined China 9,400 76,051Wild-Live/Fresh/Frozen/Dried/Salted/Brined Hong Kong 2,268 26,103Wild-Live/Fresh/Frozen/Dried/Salted/Brined Japan 58,777 743,227Wild-Live/Fresh/Frozen/Dried/Salted/Brined South Korea 108,307 735,711Subtotal 179,952 1,586,537Grand Total 502,172 3,141,455Data Source: NMFS

To gain an overview of wholesale prices in the region, data for Fulton Fish Market wasused. Although this information is based on reports from individual wholesalers andthere are some concerns about validity, it is one of the best available data sources.

Shell Oyster PricesFulton Fish Market

January-December 2002

Product State Jan Feb Mar Apr May June July Aug Sept Oct Nov DecCultivated

200 ct.CT $80 $80 $80 $80 $80 $80 $80 $80 $80 $80 $80 $80

Wild 100ct.

LA 0 0 0 0 0 0 $16.67 $16.00 $16.00 $17.71 $15.43 $15.30

Wild 100ct.

MS $18.93 $18.87 $17.91 $18.00 $18.00 $17.79 $16.20 $16.00 $0 $18.00 $0 $0

Wild 100ct

NC $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $15.00

Wild 100ct.

NJ $0 $0 $0 $0 $0 $0 $0 $0 $0 $18.50 $0 $0

Cultivated200 ct.

PEI $0 $0 $0 $0 $0 $0 $0 $0 $80 $0 $0 $0

Wild 100ct.

TX $0 $0 $0 $0 $0 $0 $16 $0 $16 $0 $15 $15

Wild 100ct.

VA $20 $0 $0 $20 $0 $0 $20 $20 $0 $0 $16 $0


While overall production and industry earnings have declined over the past six years, theoutlook for oyster demand remains strong. Northeast producers have an opportunity tosupply oysters for the entire U.S. market and to export oysters to other markets.

Oysters

020000400006000080000

1995 1996 1997 1998 1999 2000

Year



REMEDIATION

Plants and animals for remediation and other environmental applications might be alucrative area for Northeast growers. With growing concerns about depleted oyster stocksand need to improve water quality, oyster gardening has become popular in several states.Plants for beach stabilization and highway construction may be potential crops.

SEED SALES

Oyster seed sales in Northeast as reported by the 1998 Census of Agriculture are verylimited. The Census lists nine farms that produce 24,881 thousand seed. The farms arelocated in Maine (2), Maryland (2), Massachusetts (3) and New York (2). Given thecurrent interest in remediation, building of oyster reefs and oyster gardening, this mightpresent an opportunity.

The Census reports seven farms producing clam seed producing 44,400 thousand seed atan average price of $0.020 per seed. Total sales are $880,000. The farms are located inMaine (2), Massachusetts (3) and New Jersey (2).

The East Coast Shellfish Seed Directory lists 32 Northeastern companies that offer seed-Maine (2), Massachusetts (4), Maryland (2), Rhode Island (1), Connecticut (1), NewYork (8), and New Jersey (9). Many of these companies offer more than one type of seedbut production is primarily hard clams and oysters. Ten companies produced bay scallopseed.

As concerns increase about importation of seed from other locations, opportunities forlocal production may increase. Several states within the region are currently investigating


the potential for introduction of disease organisms and parasites carried by exotic strainsof shellfish. Native seed may also have a better survival rate under adverse conditions.Opportunities also exist for the development of genetically modified organisms that havebetter survival rates.

SHRIMP

As addressed earlier, domestic shrimp farmers are facing increased competition fromforeign growers. And commercial fishing of shrimp is in decline. Shrimp remains one ofthe most popular, if not the most popular, seafood�’s in the U.S. market.

Growers face not only foreign competition, but competition from freshwater growerswithin the U.S. New strains of shrimp are being farmed in freshwater as far north as LakeErie. One potential opportunity for Northeast growers is the sale of live shrimp to Asianrestaurants and supermarkets. Shrimp can also be used as a component of a polyculturesystem.

http://www.audubon.org/campaign/lo/


Shrimp

05000

100001500020000

1995 1996 1997 1998 1999 2000

Year



ORNAMENTAL FISH AND PLANTS

Northeast Aquatic Ornamental Plant Industry

State Operations UnderProtection

Inopen(acres)

Sales total(000)

Wholesale Sales(000)

Connecticut 5 N/A 5 N/A $144Delaware 2 N/A N/A N/A N/AMaine 2 N/A N/A N/A N/AMaryland 11 49 41 $1,583 $1,055Massachusetts 10 9 $ 22 $ 261NewHampshire

2 N/A N/A N/A N/A

New Jersey 13 50 4 $388New York 16 22 4 $158 $131Pennsylvania 22 20 6 $189 $631Rhode Island 1 N/A N/A N/A N/AVermont 3 N/A N/A N/A N/AWest Virginia 3 N/A N/A N/A N/AU.S. Census of Agriculture

The Northeast Region is at the center of a major market for ornamental plants and fish.The demand is so high that large producers who have effectively developed marketaccess routinely sell out. There are approximately 300 varieties of aquatic plants thathave commercial value in the marketplace. An added advantage is that the averagehomeowner kills his/her pond twice during the first 18 months. Because of the number ofspecies available and the ability to integrate production among different crops,ornamentals can be profitable in the Northeast provided the grower addresses some basichusbandry issues.

http://www.mbayaq.org/

http://www.audubon.org/campaign/lo/

http://www.mbayaq.org/


Florida growers have traditionally supplied the major markets of New York andPhiladelphia. Current shipping costs from Florida are about $30 per case. Changes inFlorida laws that restrict collection of plants have provided a window of opportunity forNortheast growers. Northeastern growers have the added advantage of being able toprovide 6- inch pots, the size that provides the greatest return. Four inch pots generallywholesale for about $4 while six inch pots can bring $6-$8 wholesale.

The best opportunities exist for those products that are not shipped as tubers but needgrowth medium for shipment. Concerns about insects and parasites limit the ability toship from one region to another and provides an opportunity for local production.

Effective marketers have recognized the need to rotate crops so that product is ready at30-day intervals. The selling season extends from April through August and can bepushed beyond those limits if appropriate crops are considered. Some products such aslotus root are harvested during March and April, which can effectively extend the season.Other food products include watercress and water chestnuts. For cranberry growers,ornamentals provide an opportunity to produce a second crop. This is an especiallyimportant opportunity in the Northeast.

Many growers recommend use of polyculture systems in which fish feces, which are highin phosphorous and nitrogen but low in potassium, can be used to grow aquatic plantswith only supplemental potassium. Algae can be re-circulated to grow snails. Theseinterdependent systems help to eliminate wastewater and other environmental concerns.Some growers have investigated the possibility of adding freshwater shrimp to thesystem.

Japanese trap door snails are native to the region and are the best snail for use in watergardens because they feed exclusively on algae.

Using greenhouses in the region can allow the production of three spawns in goldfish andtwo spawns in koi. The best target market for koi is the general market which requiressimply an attractive fish produced by crossing different colored individuals. Althoughspecialty fish such as the red goldfish marketed out of Israel command a high price, it ismuch easier to address general market concerns.

Market Trends

Retail Trends

The best supermarket targets for small to medium sized growers are ethnicsupermarkets and upscale independents. Larger supermarket chains have a centralbuying office and take advantage of volume purchasing. This structure demands avery low price and often purchase on a contract basis. Contracts can be developedfor long periods of time and often lock sellers into price and volume requirements.Because supermarkets operate on a narrower margin (approximately 30%) than


independent retailers and many regard the seafood department as a loss-leader,low prices and large volume are critical.

On a national level, many retailers are moving toward case-ready fish andshellfish program programs that allow them to minimize staff and in-storeprocessing/handling. According to a Meat and Seafood Merchandising Magazinesurvey, 68 percent of the retailers surveyed felt that case-ready fish and shellfishwould double by 2005. A Supermarket Business survey in 1987 found that fivepercent of seafood department sales came from prepared entrees. By 1999, thatfigure had risen to 25 percent.

Ethnic Markets are often clustered in specific locations. These markets are goodtargets for specialty fish and seafood items and will often pay a premium to obtainthose products. In addition to the Asian markets, which are now segmented intospecific markets serving different regions in Asia (i.e., Korean, Vietnamese, Thai,Cambodian) with different requirements, there are other potential marketsincluding the Eastern European market where specific types of fish play a majorrole in holiday celebrations. This might present a good opportunity because atholiday times consumers are willing to pay more for food products.

Overall trend in seafood retail is toward offering ready to cook, semi-cooked orready to eat products. Many supermarkets now feature prepared take outdepartments. Products range from pizza, salad bars, roasted chicken to Chinesebuffets, fried and steamed seafood, sushi and gourmet entrees and sandwiches.Fish and seafood products fit neatly into this store-prepared genre�—thepreparation and cooking guesswork is eliminated, different species andpreparations can be tried at a reasonable price and the consumer can make anindividualized food choice meeting the needs of all family members.Incorporation of cafes into traditional supermarkets provides an additionalopportunity for cross-merchandising.

Nationwide, small retailers are maintaining full-service counters to distinguishthemselves from the competition. These stores often devote more time andattention to promoting seafood.

Decrease in the number of shopping trips per week creates a need for productswith a longer shelf life.

Migration of shoppers to super-centers and warehouse stores volume packagingand lower costs.


Foodservice Trends

Tie into local groups such as the Slow Food Movement. The demand of mealsolution products is being counterbalance to a degree by a small group ofrestaurateurs who subscribe to the slow food movement. This is a worldwideorganization dedicated to quality of both food and the dining experience. Slowfood USA is an educational organization that focuses on stewardship of the landand ecologically-sound food production. The organization is particularlyinterested in regional and seasonal cuisines. They host a variety of events for bothchefs and consumers.

There is a general shift toward HMR (home meal replacement) opportunitiesrather than dinner-out because of concerns about terrorism and slumpingeconomy.

Restaurants and other foodservice companies need a constant supply ofconsistently priced product for menu placement.

Buyer Trends

As baby boomers age, healthy eating will become more important for them.Statistically, this market will continue to expand as it progresses into lateadulthood.

Increased levels of discretionary income will ultimately lead to higher per capitaseafood consumption in the U.S. market.

The rapid growth of the U.S. immigrant population will continue for theunforeseen future. Segmentation, targeting and positioning are recommended toreach immigrant segments �– most of who are favorably pre-disposed to eatseafood.

The press swirling around the aquaculture industry has been negative citingcontaminants in farm-raised seafood, lower levels of omega-three fatty acids,environmental degradation, detrimental effects on wild stocks and other productsafety concerns. Reacting to this litany of negatives would require a proactiveapproach that is well beyond the reach of trade associations and certainly beyondthe scope of small/medium sized growers.

National Audubon has published a list of seafood choices that they consideracceptable and non-acceptable from an environmental viewpoint. Atlantic salmonis in the red category, a product to be avoided. Fish in the yellow category are ofsignificant concern and include clams, oysters and mussels(www.audubon.org/campaign/lo/).


The Monterey Aquarium in California has a similar list. Farmed salmon is on thelist to be avoided. Monterey stipulates wild clams, oysters and mussels(www.mbayaq.org).

A frequently aired television program in the region features the �“Wrinkle Cure�” aprogram that strongly advocates increased consumption of salmon as a way toimprove your appearance. As the �“baby boomers�” age, there is an increasedemphasis on appearance. The low calorie appeal of fish and shellfish can be usedas a major mechanism for promotion.

OPPORTUNITIES

Identify appropriate niche markets and branch out into additional species for thosemarkets. Difficult to compete in saturated markets such as salmon and catfishwithout a marketing advantage.

Investigate the utility of cultural branding such as first nation product, maritimeheritage of the region, vacation reinforcement, �“glamour�” of commercial fishing.Give someone a reason to purchase your product above the competition.

Reduce the number of middlemen in the distribution network and try to reach theend-user. Sell to local restaurants-orders are smaller and price return is better.This may require that the grower secure additional licenses.

Depending on local regulations, sell direct to consumers at green markets. Thismay require that the grower secure additional licenses.

Sell direct to consumers via catalogues and the Internet. Try to tap into shoppingchannels that do local promotions.

Although there may be one good market that it accepting all production, it isgenerally a more prudent practice to have several buyers as a cushion againstmarket shifts. One trout grower had a very lucrative restaurant account and whenthe economy shifted, the account began purchasing less expensive frozen product.

Questions to be answered?

Although consumers indicate in survey material that they are willing to pay morefor locally farmed clams, this concept needs to borne out by actual brand utilitytesting where price points, price elasticity and purchase resistance are field-tested.Most buyers especially in chain stores tend to purchase on price.


What additional niche markets are available that would allow growers to expandthe array of products grown?

Are there markets outside the region (both national and international) that couldbe accessed by local farmers?

What are the barriers to selling an �“organic product�”?

Areas of concern from a marketing perspective

Aquaculturalists in the northeast region should be commended for building vibrantoperations on all levels (hobby growers, small, medium and large growers). Their focusranges from mariculture (salmon and shellfish) to aquaculture (finfish, baitfish, plantsand ornamentals).

By virtue of location, regional growers enjoy higher than average (U.S.) consumption ofseafood per capita than do growers in other regions. And opportunities exist to supply notonly the regional market, but the national and international markets as well.

Structurally, an overall need exists to move from a production-oriented businessphilosophy to a marketing-oriented business philosophy. That is, at some point in thenear future, growers need to approach their markets to find out what they want and whenthe want it. This is critical for the ensured long-term success of regional aquaculture.

Problems also exist in terms of Segmenting, Targeting and Positioning (STP) because it�’sclear that we can�’t compete on price. As addressed earlier, identification of niche marketsis important for survival. Expressed differently, find a niche you can scratch.

Structural changes in distribution �– cooperatives, vertical integration (own processors,restaurants, clamshacks, etc.) �– are called for to allow growers to have more control overdemand and profits. Aquaculturalists need to think creatively about ways to partner withmembers of the distribution channel, either formally (preferred) or informally.

Finally, there is a clear need for the increased involvement of marketing scholars inresearching aquaculture marketing processes. Although excellent research in this area hasbeen conducted by agricultural economists, their work is missing the necessarytheoretical underpinnings necessary for the development of marketing-oriented solutions.By working together, marketers, economists and growers can develop the expertiseneeded to increase the competitiveness of growers in the northeast region.


Areas for Future Research�•Research is needed in the area of consumer preference �– determining what to grow andwhy

�•Research is needed to study the price elasticity of seafood purchases �– will consumersreally pay more for aquacultured products versus imports?

�•Research is needed to investigate expanding the market for our products (i.e., exporting).

�•Research is needed in packaging and product handling, and

�•Research is needed to determine the most effective channels of distribution

Industry Feedback

Two focus groups with industry members were conducted after the initial presentation ofthe marketing white paper at NRAC�’s 2003 Industry summit. The following issues wereof major importance to attendees and worthy of future research:

�•Price �– how to be a price setter�•Promotion �– proactive rather than reactive�•Environmental labeling �– green/blue�•Differentiation from imports (states/countries w/lower cost of production)�•Identification of distribution networks �•Price utility of branding�•Country of origin labeling�•Who are we marketing to and who isn�’t buying?�•Processing waste utilization�•Value-added processing�•Market saturation �•Introducing consumers to seafood (baby food example)�•Targeting high-end buyers�•Identifying new species/trends (Artic char)�•Legal constraints, size limits�•Market timing (holding stock)

In summary, opportunities for aquaculture farmers in the northeast abound. However, aneed exists for the adoption of a marketing orientation rather than a productionorientation, especially since growers may not be able to compete on price.

Working together, aquaculture professionals, scientists, resource economists andmarketing professionals may enjoy broader success and ensure the long-term viability ofthe industry within the region.


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Burtle, Gary J., Larry W. Dorman and D. Leroy Gray. Baitfish Production in the UnitedStates. Warnell School of Forest Resources: Service and Outreach: Information Library

Bennett, Brian and Gerard D�’Souza (2003), �“Genetically Modified Fish and Seafood:Consumer Attitudes, Marketing Strategies and Policy Implications�” Presented at 7th

International ICABR Conference, Ravello, Italy, 2003

Boch, Elizabeth (2003), �“Federal Court Ruling Alters Maine Salmon Farming Tactics,�”The Boston Globe, May 31, 2003, p. B.3.

Broad, William J. and Andrew C. Revkin (2003), �“Has the Sea Given Up Its Bounty?�”The New York Times, July 29, 2003, pg. F.1.

Chao, Julie (2003), �“Shrimp and Free Trade: China�’s Production Booming, butAntibiotics Cause Concern,�” The Atlanta Journal-Constitution, February 26, 2003, pg.F.6.

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APPENDIX

1. Estimated U.S. Aquaculture Production, 1995-2000

2. Aquaculture Products �– Percent of Sale by Point of First Sale 1998


Source: NMFS 2001


ABBREVIATIONS AND SYMBOLS

The following abbreviations and symbols are used throughout the tables:- Represents zero(D) Withheld to avoid disclosing data for individual farms(NA) Not available(X) Not applicable(Z) Less than half the unit


Funding was provided by the Northeastern Regional Aquaculture Center through GrantNumber 98-38500-5917 from the U.S. Department of Agriculture Cooperative State, Research,Education and Extension Service (USDA-CSREES).

Any opinions, findings, conclusions or recommendations expressed in this publication are thoseof the authors and do not necessarily reflect the views of the U.S. Department of Agriculture, theNortheastern Regional Aquaculture Center, or the University of Massachusetts Dartmouth.

NRAC Project No. WP03-7

Produced for:

Northeastern Regional Aquaculture CenterUniversity of Massachusetts Dartmouth

Violette Building, Room 201285 Old Westport Road

North Dartmouth, MA 02747-2300

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