China’s processing sector ripe for big change

Published on
October 9, 2011

The recent announcement that Marel is installing a new processing system in Pacific Andes’s whitefish factory on the outskirts of Qingdao in northern China, confirms the massive change that is starting to take place in that country’s seafood processing industry.

The days when workers would stand in rows, often with nothing more than a knife, a ruler and a set of old fashioned scales, are drawing to a close as they move on to better paid jobs and the machines move in to replace them.

However, what it also confirms is that seafood processing equipment manufacturers such as Marel, are now designing and installing complete processing lines rather than selling individual machines.

“We focus on providing companies with complete processing lines, not just individual pieces of equipment,” said Kristján Hallvardsson, Marel’s director of product development, at Seafood Processing Europe earlier this year. “We are a total solution provider. Processors are now looking for a single point of entry. They prefer one company to be responsible for the whole line — for delivery, installation, service, etc.”

The line for the huge Pacific Andes factory neatly illustrates this concept. Built to a completely new design, it includes defrosting, cooling, grading and trimming equipment. It will be used for the high volume processing of wild-caught whitefish species such as Alaska pollock and, perhaps more interestingly, farmed freshwater substitutes such as pangasius and tilapia.

The project is led by Marel, but the company is not providing all the equipment. It has teamed up with 3X Technology and Skaginn, which will supply some specialist machines.

This cooperation with other equipment manufacturers is also becoming commonplace.

“Sometimes we need partners to supply machines we don’t manufacture ourselves,” said Regina Dedow from the marketing department of Baader, the international seafood processing equipment manufacturer headquartered in Germany.

“For example, for our new high speed salmon processing line we would need to buy in a pinboner and a deslimer. However, fish processors can get everything from the one source, when they come to us.”

Not only does Marel team up with other equipment manufacturers when necessary, it also transfers technology from other sectors of the group.

“We also manufacture processing equipment for the meat and poultry industries as well as fish,” said Hallvardsson. “And we transfer technology from one sector to the other. We are very active in doing that as we are continuously looking to improve and broaden our product portfolio to increase our customer value.”

Marel is by far the biggest manufacturer of seafood processing equipment in the world, supplying 15 to 20 percent of all the machines manufactured. The company spends EUR 35 million to EUR 40 million (USD 48 million to USD 54 million), or 5 to 7 percent of its revenue, annually on research and development, although this is for the whole group, not just seafood.

The installation of the Pacific Andes line is the first stage toward full automation in China’s largest whitefish production plant, and Pacific Andes has already announced plans to upgrade other plants with similar systems, according to Marel, should the line prove a success.

The increasing cost of labor in countries such as China will inevitably lead to more automation in the fisheries sector.

Marel says it has been systematically building up a strong team there in recent years, with “the emphasis largely on whitefish in the north and farmed species such as tilapia in the south.”

Fish processing in China has traditionally been a labour intensive activity, with plants typically employing 4,000 to 12,000 workers, so it is no wonder that the Chinese fisheries sector faces increasing competition for labor in what is one of the world’s fastest growing economies.

So with more “total processing solutions” likely to be installed in Chinese and other Asian seafood factories as labour becomes more expensive, there could well be good times as well as change ahead for processing equipment manufacturers.

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