Joseph Sabbagh is the president of Calabasas, California, U.S.A.-based Sax Maritime Associates, which has been offering consulting services to those invested or considering investing in the seafood industry since 1985.
A review of seafood headlines for Q1 2025 highlights continued flat sales and the steps companies are taking to try and improve that. From my review of this decade's sales, I believe the industry in general – and at retail especially – peaked in March 2022. I have written about the demand issues that have plagued the industry in the past, and this piece is focused on public information on the moving and shaking of three players making news of late and offers comments on some history that may help their plans.
Pacific Seafoods' “bold move”
One of the more interesting headlines has been about Pacific Seafoods Group's (PSG) Mission 31, in which the firm announced it would double its business by 2031. As a private company, only its stakeholders, lenders, and the government know what double its business means from a numbers standpoint. I have been retained by a few second-generation companies and know of many others. I can think of none that have done better than PSG. When I first heard about its plans, I thought it was merging with or acquiring Trident – perhaps worth at least a conversation between them.
PSG has created a company with intelligent investments in aquaculture, processing, and distribution of other proteins, as well as its sourcing of wild-caught seafood. I could see the firm expanding any of these areas to reach its goals organically or by M&A. I do not see its new consumer packaged goods (CPG) line being much help.
In articles and on the company's website, it lists three attributes of its new packaging around its eye appeal and information. I could find no mention of the products that are in the packaging. I could not find what is new or better about the contents the consumers will actually eat nor was there any mention of MSRP. I may have missed it, but product and price should be front and center.
PSG is not alone in its desire to grow its frozen CPG brand. The problem is grocers are more interested in promoting their own brands. If your line does well, grocers will often create similar products under their brand.
When seafood brands were a focus, I remember a meeting I had with Mrs. Paul's in the mid-1980s. Seafood was booming then, and most new items did well at launch. They said they were cautious not to get too excited and stock too much inventory after a good launch. They stressed the need to be patient before declaring it a winner and building inventory as they got burnt early on. This is a good lesson today, especially with the private-label focus.
Cooke full speed ahead
In general, I am cautious about the demand for seafood. Cooke's USD 4 billion (EUR 3.6 billion) in estimated sales, 15 acquisitions since 2016, and investments in 15 countries indicates Mr. Cooke does not agree. I do not know the company's ROI expectations on profit and timeline, but I do like most of its deals. Cooke’s focus on species, market diversification, and growing distribution all seem like a great strategy. I respect the battles they must face operating aquaculture companies in Canada, Australia, and the U.S. state of Maine and managing over 13,000 staff.
I include Cooke in this post not for what it has bought or what markets it has entered but for the investment and market it just divested from. A growth-focused company the size of Cooke leaving a partnership in Alaska coupled with the other seafood news in the state should be the topic of conversation in Juneau.
Silver Bay must avoid the Alaska echo chamber
I have a great respect for Alaska, fishing families. I hope the Cooke deal and all it invested in pays great returns. From my time in the industry and constant review of data on consumer trends, I am concerned the demand for frozen sockeye in the U.S. will be at the levels those in Alaska will not like.
I do not know how Russia and other countries will influence the international sockeye market. I have been critical of Alaska-based companies and others in the seafood industry for marketing to themselves. I am seeing continued evidence that those making decisions for the state are repeating the wornout Alaska mantra: “We don’t care how they do it outside.”
Case in point is the Alaska Permanent Fund Corp’s (APFC) treatment of Gabriellie Rubinstein, the owner of Manna Tree Partners, leading to her stepping down from the board in August of 2024. She is the daughter of one of the most successful investors in the country, the founder and top owner of the Carlyle Group's USD 440 billion (EUR 398 billion) fund. According to reporting, the APFC accused her of using her position to benefit her friends and family.
Based on its “outside” of reality thinking, the APFC would rather she involve those she does not know or recycle past advisors, as opposed to her legendary father and the people who helped grow the Carlyle group to an international private equity company.
This is the same APFC that invested, and so far has lost, USD 27 million (EUR 24 million) in the ill-conceived Peter Pan deal that continues to cause harm to Alaska fishing families and communities. Those making decisions like this should be held accountable. I hope Silver Bay and all the entities in Alaska creating headlines make the investments to validate demand and better process the fish they are catching.
Focus on the bottom line
Every industry has to deal with events and conditions they cannot control; the seafood industry has more than most.
Seafood has always been a high-risk, low margin business. These two realities necessitate seafood executives to make unemotional decisions based on verified information. Most times, business owners are too focused on the top line. For most of the seafood industry, I do not think now is the time to do that.
