Salmon keep processing sector afloat
The report, which is based on a Census Survey carried out by Seafish last year, reveals that, in 2014, there were 62 salmon processing units in the UK, providing 4,648 FTE jobs – a net increase of 10 salmon processing units and 1,021 FTE jobs – showing how the salmon processing sector has well and truly bounced back from the recession it experienced between 2008 and 2012.
Overall there were 403 fish processing units, providing a total of 19,511 FTE jobs – so the salmon sector now accounts for about a quarter (24%) of the UK’s fish processing industry.
The report also reveals that 63% of salmon processing units and 76% of industry employment were based in Scotland, underlining the industry’s importance north of the Border. However, since 2008 the salmon processing industry has been strengthening its presence in the rest of the UK, with a 35% increase in the number of units and a 63% increase in the number of FTE jobs outside Scotland between 2008 and 2014.
Salmon processing has recently become more polarised in terms of unit size. In 2014, 63% of units were either very large (101+ FTEs) or very small (1-10 FTEs), compared to 45% of units in these categories in 2008.
Hazel Curtis, Seafish Chief Economist, told Fish Farming Expert: “The salmon sector has now recovered back to 2008 levels, in terms of number of processing plants and number of jobs, having declined during the global recession. Employment since 2012 has increased by 28%.
“Many businesses find it advantageous to process a mix of wild caught fish and farmed salmon, with the regular supply of salmon helping them to smooth out the peaks and troughs in activity that can be caused by variations in supply of UK landed fish, enabling them to make better use of labour.”
Scott Landsburgh, Chief Executive of the SSPO, added: “Demand for Scottish salmon continues to go from strength to strength as producers capitalise on their reputation for producing top quality, healthy, nutritious food. These latest findings demonstrate how the popularity of Scottish salmon has impacted on the value chain delivering economic benefits to many areas across the UK.”
The report also includes the latest available financial data from 2012, revealing that sea fish processing turnover increased by 16% from 2008; however, operating costs increased by 20%, resulting in lower profitability. The higher cost of raw materials is thought to be the main reason for the reduced profitability, with increasing costs generally not fully passed on to customers. Despite this, there is evidence of strong investment in fixed capital assets, such as equipment and premises, with the value of tangible fixed assets increasing by 49% from 2010 to 2012, indicative of a recovery in confidence following a period of economic uncertainty.
Hazel Curtis explained: "The supply of raw materials, regulatory and trade developments such as exchange rate movements, skill shortages, securing finance and retailer pressure on suppliers create problems for many businesses in the seafood processing industry. At the same time, growing demand for seafood and signs of economic recovery underpin industry confidence in the long-term sustainability and profitability of seafood processing in the UK.
"We have developed this year's report to include qualitative findings about the wider business environment for the first time, to give the data some context and ensure anybody interested in the seafood processing sector can get a clearer picture of the current state of play."
The full 2014 Seafood Processing Industry Report and data tables are available to download from http://www.seafish.org/
