U.K. seafood processing industry deemed stable despite challenges

The number of seafood processing units operating in the United Kingdom has fallen in the last two years, but employment in the industry has increased slightly thanks to an expansion of the salmon sector, according to a new report published by Seafish.

Following a census survey carried out last year, the U.K. authority has published its “2014 Seafood Processing Industry Report,” giving an overview of the size and structure of the industry, including processing units, employment levels, regional distribution, types of processing activity and the species being processed.

The survey results, which include processing of all seafood species, found that there were 403 processing units in the country last year providing 19,511 full-time equivalency (FTE) jobs. This includes 62 salmon processing units, providing 4,648 FTEs, which is 28 percent more than in 2012.

Despite an overall reduction in the number of units, the largest-size band of processors with more than 101 FTE positions had increased by 29 percent and the smallest-size band of 1-10 FTEs had increased by 10 percent.

Seafish said the increased concentration of the industry into very large units is evident, with the 101-plus FTEs size band accounting for 65 percent of industry employment in 2014, compared to 58 percent in 2012. At the same time, the increase in the number of smaller units suggested there have been several young businesses entering the processing sector, it said.

The report also includes the latest available financial data from 2012, which found that processing turnover had increased by 16 percent since 2008 to GBP 4.2 billion (EUR 5.9 billion; USD 6.5 million), but also that operating costs had increased by 20 percent, 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, said Seafish. Despite this, it added that 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 percent from 2010 to 2012, which was “indicative of a recovery in confidence” following a period of economic uncertainty.

“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,” said Hazel Curtis, chief economist at Seafish. “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 U.K.”

Subscribe

Want seafood news sent to your inbox?

You may unsubscribe from our mailing list at any time. Diversified Communications | 121 Free Street, Portland, ME 04101 | +1 207-842-5500
None