Strategies of Access to US Markets for Tilapia

Kevin Fitzsimmons, Ph.D.University of ArizonaTucson, Arizona, USA

&Vice President, American Tilapia Association

President Elect, US. Chapter of World Aquaculture Soc.

Introduction• Tilapia first imported in 1950’s• Aquaria and zoos• Weed control and baitfish• First aquaculture in late 60’s and early 70’s• Many biologists learned through Peace Corps• Early farms in geothermal areas in West,

Florida and Alabama

Harvesting from geothermal ponds in California

Early Markets

• For stocking golf course ponds and irrigation systems

• Oriental stores and restaurants, live fish

• Live hauling to San Francisco, New York, San Diego, Toronto, Vancouver

Introduction

• Tilapia is still a “new “ product in US markets.

• Tilapia will be one of the big four seafood products in the 21st Century (salmon, shrimp, catfish and tilapia)

Current Status

• Live production from domestic producers, processed from imports

• Recirculating systems and geothermal waters.

• Established market demand.

• Popular in several product forms.

Source of US Tilapia supply 2000 (by volume)

2000 US Tilapia Supply

OTHER4%

CHINA24%

JAMAICA1%

COSTA RICA10%

ECUADOR13%

INDONESIA3%

TAIWAN28%

HONDURAS5%

US12%

US. Tilapia imports 1993-2000

Sources of imported tilapia to US

0

10000

20000

30000

40000

50000

60000

70000

1993 1994 1995 1996 1997 1998 1999 2000

(LW

E in

met

ric

tons

)

others

Thailand

Indonesia

Colombia

China

Mexico

Jamaica

Ecuador

Costa Rica

Taiwan

Tilapia imports to US(1992-2000)

Figure 1. Tilapia product forms imported to the U.S.

Fillet Fresh

Fillet Frozen

Whole Frozen

0

5000

10000

15000

20000

25000

30000

35000

40000

1992 1993 1994 1995 1996 1997 1998 1999 2000

Met

ric to

ns

Whole Frozen

Fillet Frozen

Fillet Fresh

Value of Tilapia imports (1992-2000)

Figure 2. Value of Tilapia product forms imported to the U.S.

Fillet Fresh

Fillet Frozen

Whole Frozen

$0

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

$60,000,000

$70,000,000

$80,000,000

$90,000,000

$100,000,000

1992 1993 1994 1995 1996 1997 1998 1999 2000

$ U

S

Whole Frozen

Fillet Frozen

Fillet Fresh

Typical prices for Tilapia products sold in the U.S.

(November 2000.)

Pond-side/Processor

$/kg

Wholesale$/kg

Retail$/kg

Whole live fish 2.20 - 6.60 2.80 - 7.50 4.00 - 10.00Whole frozenfish

1.10 - 2.00 2.00 - 2.35 2.20 - 5.00

Whole freshfish

2.30 - 3.00 3.00 - 4.00 4.00 - 9.00

Fillets, fresh 5.00 - 7.00 6.00 - 8.00 8.00 - 12.00Fillets, frozen 4.80 - 6.75 5.50 - 7.80 7.00 - 11.50

Established US market demand

• Now available in most regions

• Available in many forms

• Live, Whole, fillets, fresh and frozen, smoked, sashimi

Middle Level Marketing

• White tablecloth restaurants

• Specialty seafood stores

• Live tanks at seafood counters

• Develop additional ethnic markets

Current Trends of US Tilapia Markets

• US growers will concentrate on live sales and highly processed forms

• Increasing demand for all forms of tilapia, but greatest for fresh fillets

• Prices have been constant for several years, may decrease slightly

• Southeast Asia and Latin America will be primary suppliers

Current Trends

• Increase in demand for all forms of tilapia

• Demand increase will be greatest for fresh fillets

• New markets need to be developed

• Further value added forms; smoked, marinated, microwave ready

Tilapia Marketing Institute

• Formed in 1998, hired marketing firm to develop generic market campaign

• Funds provided by Latin American, one Asian producer and their US marketers

• Recently added first US producer

• Goal is to increase recognition and demand for all forms of tilapia

Problem areas in US markets for Tilapia

• Small fillet size from some producers

• Off-flavors

• Inconsistent supply

• Inconsistent quality

• Need more customer recognition

Marketing Solutions:

• Quality control programs

• Generic and brand advertising

• Tilapia Marketing Institute

• Local marketing efforts

Current Trends for US Tilapia Markets

• US (and EU) growers will concentrate on live sales and highly processed forms

• Southeast Asia and Latin America will be primary US suppliers

• Africa, Latin America and Caribbean will supply EU

International suppliers to US• China has taken a large % of Taiwan share

• China is expanding production

• Honduras and Ecuador have rapid expansion of exports

• Colombia, Costa Rica, Brazil and Mexico may increase exports

• Cuba could be major exporter if trade embargo ends

International suppliers to US

• Ecuador has passed Costa Rica as supplier of fillets to US, by integrating with shrimp production

• Colombia, Thailand and Mexico were exporters to US, but exports levels decreased while production increased

• Philippines is big producer, some exports to Japan, currently no exports to US, but great interest

US tilapia marketing goals

• Increase domestic demand• Increase value added forms (breaded,

marinated, ready to microwave)• Maintain environmental awareness• Market tilapia as ecologically

efficient and sustainable

Access to US markets

• Seafood restaurants, especially chains (Red Lobster, Landry’s)

• Most grocery stores• Competing with catfish, trout, salmon,

sole, flounder and other marine species• Compete with chicken, beef, pork

Recommendations to enter US tilapia market

• Joint venture with existing marketing entity

• If solo, try to co-market with other products

• Avoid traditional seafood importing and brokers (they will not spend any money to develop markets)

• Develop value added products (fillets, breaded forms, sashimi, etc.)

Recommendations to enter US tilapia market (cont)

• Find marketing partner (seafood chain, large grocery chain, wholesale stores, food service supplier)

• SYSCO and SHAMROCK

• Be willing to donate samples • Be prepared to spend money for

advertising and market development

Internet Auction sites

• Inexpensive way to start

• Still need lots of infrastructure (storage, shipping, finances, etc)

• Intermediary costs

Internet Tilapia Market sites

Internet Tilapia Market sites

www.tilapia.org