Seafood Commodity Trade Analysis Supplement to “Progress toward Sustainable Seafood: 2015 Edition”

California Environmental Associates

Photos: Otto; Cedric Pau; Bytemarks; Bytemarks. Via Flickr. Table of contents

Introduction 4

Commodity Analyses 9 Crab 15 Lobster 30 Octopus 45 Pangasisus and other catfish 52 Salmon 57 Shrimp 63 Small pelagics 72 Snapper and grouper 83 Squid 85 Tilapia 92 Tuna 97 Whitefish 102

2 Introduction

3 The short-term reach of market-based incentives will largely be driven by how many fisheries are closely linked to markets that have strong demand for sustainable seafood

The demand for “sustainable” seafood is largely limited to the United States and Northern Europe, which together account for roughly a third of imported seafood globally • The reach of market-based conservation interventions extends only as far as the demand for sustainable seafood. Currently that demand resides exclusively in North America (driven largely by the United States) and Northern Europe, which together account for roughly 32% of global imports by value. • This import demand pressure is somewhat diluted by significant levels of intra-European trade.

These markets have strong preferences for a handful of commodities, and many fisheries for these commodities are already certified or in a fishery improvement project (FIP). Opportunities for further engagement of fisheries vary greatly across commodities: • Crab: Achieving impact in existing swimming crab FIPs is a priority. Market dynamics will make expansion of market incentives challenging for other crab species. • Lobster: Few good candidates for new lobster FIPs remain; achieving impact in existing FIPs (e.g., in Brazil) may be more impactful than expanding to new fisheries. • Octopus: Market programs have not had much traction with octopus fisheries, and market dynamics are challenging. • Salmon: Limited expansion opportunities exist given strong current certification of Alaskan fisheries already certified, achieving progress in existing FIPs is likely the best near-term opportunity. • Shrimp: Cold-water shrimp is largely certified, with few additional opportunities. Progress in tropical shrimp fisheries remains elusive; market pressure is thus far insufficient to address the scale of difficulty in these fisheries. • Small pelagics: As the the sustainability bar, industry has settled on IFFO RS, which has certifications in ~80% of small pelagic fisheries by volume. Need to change buyer standards in order to empower other market-based programs. • Snapper/grouper: Difficult context in which to achieve short-term success. • Squid: Market programs have not had much traction with squid fisheries, and market dynamics are challenging for this commodity. Intro • Tuna: ISSF has strong coverage of tuna; potential gains could be made by improving coordination of FIPs. • Whitefish: Limited expansion opportunities exist, given current wide adoption of MSC and FIPs.

4 Almost 40% of global seafood production by volume is traded internationally each year

Share of commodity production traded • To date, the sustainable seafood internationally, by volume movement has used international market pressure (e.g., retailers in the EU and the 40% 37% US) to compel fisheries to get certified, 35% 34% participate in FIPs, or make improvements in response to seafood 30% ratings. 25% • Seafood is one of the most heavily traded commodities in the world, making it an 20% 19% excellent target for international market pressure. 15% 13% 12% 11% 10% 7% 5%

0%

Rice

Beef

Share of global commodity production (% by volume) by (% production global commodity of Share

Sugar

Wheat

Poultry Seafood

Intro Coarse Grains Coarse

FAO, 2014, State of Fisheries and Aquaculture. 5 The United States and the EU15 account for ~47% of global seafood imports; Japan accounts for an additional 12%

• The United States and EU15, where sustainable seafood markets are most developed, account for 47% of global seafood imports by value. • Japan, a country that is commonly identified as a next logical target for cultivating sustainable seafood markets, accounts for an additional 12% of global seafood markets. However, Japan’s imports are chiefly confined to shrimp and tuna. • Southern Europe (including France) is also a logical target for further demand-side cultivation, and accounts for 45% of the EU15’s total seafood 12% imports by value.

Imported value of seafood for EU15 member countries $26 $47 $50 Germany 47% UK $40 Sweden 55% Denmark $30

France $21 Other (18) Other (9) Other (9) Spain $20 Ecuador Vietnam Vietnam Iceland Indonesia Chile Italy 45% Poland Chile USA Portugal $10 China Thailand Russia Intro Greece Top trade partners  Norway Canada Thailand $0 Weak Strong Total EU15 Sustainable Sustainable Seafood Seafood Markets Markets 6 In addition to Japan, Hong Kong and South Korea may be good targets as the next frontier for sustainable seafood markets

Seafood Imports 2013 USD (billions) World China Hong Kong S. Korea $140 China The main countries that China imports from are either fishmeal Norway $120 suppliers or countries that are Brazil sending product to China for $115 processing. Prospects for China Australia $39.8 $2.0 seem limited beyond a CoC hub. Poland $2.9 $110 Canada $3.2 Thailand $105 Hong Kong $3.3 Russia Building demand for sustainable Vietnam $3.3 $100 seafood could exert pressure on Other S. Korea $3.7 select Japanese fisheries (sea $95 Other cucumber, scallops, abalone) and Hong Kong $4.5 $90 Chinese fisheries (crab, shrimp, Other squid). China $8.3 $85 EU15/Japan/US South Korea $0 Developing market demand could 2013 Imports Other (3.7) Other (2.4) Other (1.3) exert pressure on select fisheries Norway (0.4) Canada (0.1) Chile (0.1) in China (octopus, shellfish, crabs, Intro Chile (0.4) USA (0.2) USA (0.2) Peru (1.0) Australia (0.3) Vietnam (0.5) squid) and Russia (crab, pollock, USA (1.3) Japan (0.5) Russia (0.6) cod). Russia (1.5) China (1.0) China (1.0) International Trade Centre; trademap.org. 7 Large volumes of intra-continental trade mean that the influence of core markets may not be as great as overall trade data suggest

• Intra-European trade: More than 60% of seafood imports into European countries come from other European countries, most notably Norway (e.g., salmon). • Intra-Asian Trade: Asia appears to be the place where the EU and NA markets may have the most potential to influence developing world fisheries, but strong intra-Asian trade limits the overall Intro influence in these markets outside of a few key commodities.

International Trade Centre; trademap.org. 8

Commodity Analysis

9 Commodity analysis overview

Overview The following sections provide an overview of some of the main seafood commodities, including their engagement with market-based conservation tools and high-level assessments of the prospects for expanding the use of market- based tools within these commodities. In this analysis, fisheries that export a large share of their product to Northern Europe and the United States are generally assumed to be good candidates for additional market-based interventions. Although there are exceptions to this rule, this filter should provide a good first-order assessment of what fisheries are most likely to respond to Western market pressure. This filter is not sufficient to determine whether market-based approaches will work well, but additional information (e.g., key supply chain partners, governance context) is beyond the scope of this overview.

Data We used the following data sources in the analysis: • FAO Fishstat – Landings data for each commodity by country • WCPFC, ICCAT, IATC, IOTC – Tuna landings data • FAO Fishstat – Total volume (by product weight) of seafood exports by commodity • FAO – Product weight to round weight (i.e., weight of whole fish/seafood product) conversions • International Trade Centre – Detailed seafood trade data by value (including identification of trading partners) • Marine Stewardship Council – Volume estimates for certified fisheries • Fisheryimprovementprojects.org/FishSource – Volume estimates for FIPs • Sustainable Fisheries Partnership, 2014. Small Pelagics: SFP Fisheries Sustainability Overview

Overview and Methods

10 Data limitations (1 of 2)

Limitations of trade data Analysis in this presentation uses international trade data. When interpreting these data, a few important factors should be considered. 1) A substantial portion of traded seafood is classified in generic categories (e.g., frozen fish fillets not elsewhere specified). This means that not all traded seafood can be accurately classified into a specific commodity group. Our hypothesis is that this characteristic of trade data has the largest impact on freshwater species (e.g., tilapia, catfish) and snapper/grouper. This is probably less of a concern for products that are easily classified (e.g., lobster, shrimp). 2) Trade volumes are reported in product weight. This creates a challenge in estimating apparent consumption because traded volume must be converted to round weight of fish. We have used product to round-weight conversion factors from FAO (unpublished). While we believe these conversion factors to be well-vetted, using these conversion factors induces some margin of error. 3) Reporting accuracy varies from country to country. In some of the most obvious cases of inaccurate reporting of trade data (e.g., Vietnam, Russia), we have used “mirror data” as a substitute. For example, instead of using Russia’s reported crab exports, we used the sum of all of the other countries’ reported crab imports from Russia. Data was only available to use this “mirror data” method for traded value.

Overview and Methods

11 Data limitations (2 of 2)

Volume data We have used volume information reported on MSC’s website and on fisheryimprovementprojects.org to assess the share of a commodity that is certified or in a FIP. This is a rough calculation because landings of species can fluctuate substantially from year to year, while the year reflected in a given landings report from a FIP or certified fishery is not always clear. Thus, the charts that illustrate the volume/share of a commodity that is in a FIP or certified should be treated as a rough estimate that can fluctuate from year to year.

Certification and Fishery Improvement Project data For certain commodities, we identify the presence of fisheries that are either MSC certified or engaged in FIPs. These data are from 2014 and may not reflect all contemporary engagements.

Overview and Methods

12 Flow diagram for estimating the share of commodity production that is destined for US or EU15 markets

Throughout the report we estimate how much of a country’s commodity production is exported to EU15 or US markets. The following flow diagram outlines our methodology for generating these estimates. Commodity Production Commodity (Round Weight) Exported FAO FISHSTAT Production Database (Product Weight) Share of FAO FISHSTAT Trade commodity Database production exported (%) Commodity Exported (Round Weight) Share of commodity Product Weight to production Round Weight exported to US or Conversion Factors Commodity EU15 (%) FAO Exported (Value) International Trade Center Share of exports that go to US or Legend EU15 (%) Overview Data input Commodity and Exported to US or Methods Calculated value EU15 (Value) International Trade Center 13 Trade data provides a high-level assessment of the opportunity for market incentives, but has important limitations Limitations of the approach Identifying major producers of seafood commodities that export a large share of their product to EU and North American markets is a helpful screen for identifying good targets for market-based incentives. That said, it is a coarse analysis and will likely gloss over some discrete opportunities that exist in places that, at first glance, may not appear to have the fundamentals in place to leverage market pressure for fishery reform.

The analysis in this presentation is also entirely desktop-based. Those who work intimately with specific seafood supply chains will have insights beyond what can be discerned from reported production and trade data alone. We would welcome any feedback on where the publicly available data that we are using does not accurately reflect the dynamics of a specific seafood commodity.

Overview and Methods

14 Crab commodity analysis

15 Crab > Overview Top 10 Producers: China is, by far, the largest producer of crab

2011 Capture Wild-capture crab production by fishing country (Tonnes)

650,000 618,201 600,000 550,000 500,000 450,000 400,000 350,000 300,000 250,000 234,676 200,000 167,445 150,000 94,598 100,000 84,000 81,844 69,813 42,612 50,000 35,971 32,082 31,924 0 China USA Canada Vietnam Indonesia S. Korea Russia Thailand India Philippines Other

Crab

FAO Fishstat; FAO product to round weight conversion factors; CEA analysis. 16

Crab > Overview Top 10 Exporters: China, Canada, and Russia are the main crab exporters 2014 Exports Top crab exporters and their largest trading partners (USD millions) Trading partners are identified within each column. For example, the biggest trade partners for $1,300 China’s exported crab are, in order, Hong Kong, USA, Japan, Taiwan, South Korea, and Singapore. $1,200 Other $1,100 Singapore S. Korea $1,000 Thailand $900 Taiwan H. Kong Indonesia $800 Other China Vietnam $700 Japan Canada Korea $600 Japan Other Singapore $500 USA UK Other USA Japan Vietnam $400 Indonesia Other Other Japan Singapore Ireland Other Other Other $300 China Other Taiwan Portugal China Canada Taiwan USA China China China UK H. Kong Canada $200 Macao H. Kong H. Kong Spain France USA Vietnam Japan China USA France Japan China Australia $100 Vietnam Canada USA Japan USA $0 USA China Canada Russia Indonesia USA Hong Philippines United Vietnam S. Korea Thailand Other Crab Kong Kingdom Exporting countries

International Trade Centre. 17 Crab > Overview Top 10 Importers: The United States is the largest importer of crab, and Japan is also an important market 2014 Exports Top crab importers and their largest trading partners (USD millions) $1,700 $1,600 Other $1,500 Venezuela India $1,400 Mexico $1,300 Thailand Vietnam $1,200 Philippines $1,100 China $1,000 Other $900 Russia Indonesia Korea $800

$700 Myanmar Indonesia USA $600 Bangladesh Other Canada Indonesia Other $500 Other Malaysia Other Other Pakistan China Japan Singapore Other Other Thailand $400 Bahrain Other Indonesia Canada Argentina Russia Phil. Norway Portugal $300 Canada Chile Indonesia Belgium China Canada Namibia USA Canada Vietnam Indonesia $200 China Phil. France Russia Russia Ireland India Ireland $100 Canada Russia China H. Kong USA UK UK $0 USA Japan China S. Korea Hong Vietnam Canada France Singapore Spain Other Crab Kong Importing countries

International Trade Centre. 18 Crab > Overview Top 10 Consumers: The United States, Canada, and Asia are the main crab consuming regions of the world

2011 Apparent Consumption (Tonnes Round Weight) Top crab consumers

500,000 468,688 450,000 400,000

350,000 338,606

300,000

250,000 214,653 200,000

150,000 138,159

100,000 73,768 48,158 43,984 41,502 36,244 50,000 29,672 20,900 0 China USA Japan Korea Hong Vietnam Canada France Indonesia Taiwan Other Kong

Crab

FAO Fishstat; FAO product to round weight conversion factors; CEA analysis. 19 Crab > Overview

There are four main families of crab species: swimming crabs, Argentina

spider crabs, cancer crabs, and king crabs Norway

Russia Chile

King crabs USA

Crab landings

(thousand tonnes) 1,483 Other 34 13 8 8 3 2 34 99

King

Norway

Canada

Ireland

France Other

Cancer 207 Cancer crabs Chile USA

Spider UK

Not Elsewhere 327 Included 37 26 10 7 7 5 5 3 99

(NEI)

S. Korea S.

Canada

Russia Other

Spider crabs Japan

USA

Swimming 809 84 35 29 27 23 8 207

Philippines

Venezuela

Indonesia

Australia

Thailand

S. Korea S. Mexico

Swimming crabs Taiwan

Other

China

USA

Legend* 2011 Crab MSC-certified or in 8 5 assessment 498 90 82 32 31 27 20 809 10 8 In a FIP No FIP or MSC certification FAO Fishstat. 20 Crab > Overview Crab Overview: Swimming crab presents a question of pursuing depth vs. breadth for FIPs; market dynamics for other crab commodities are challenging

Market-based conservation programs engage fisheries accounting for ~20% of global crab production Swimming crab raises the question of depth versus breadth for FIPs - FIPs are being implemented in many of the largest swimming crab fisheries, but the diffuse nature of these fisheries is making it a challenge to deliver changes on the water. Although there are some opportunities for expansion (India, China, S. Korea, Taiwan, Venezuela), an argument could be made that the FIP model should be proven in an existing swimming crab FIP before undertaking further expansion. - Ultimately, achieving commodity-wide transformation could require working in China (60% of swimming crab landings). Cancer crabs: Seafood Watch appears to be the program of choice for cancer crabs in N. America; market dynamics for European brown crab fisheries are not favorable - Oregon Dungeness crab voted to leave the MSC program in 2015. The fishery is not seeing sufficient value in the program since N. American retailers continue to buy California Dungeness crab, which remains uncertified. Dungeness crab that is exported goes primarily to Asian markets with weak sustainability demands. - Similarly, the primary goal of the Jonah crab fishery in New England is to be delisted from the MBA red list. - Edible crab products in Europe are exported primarily to S. European markets with weak sustainability demands. King and spider crabs: Some potential but market dynamics are a challenge - Market-based programs have taken root in these fisheries, with MSC-certified Canadian snow crab and two FIPs underway for Russian king and spider crabs. - Market pressure may be limited as Asia is the main consumer of these species, and Alaska’s pursuit of Alaska Seafood Marketing Institute (ASMI) certification, developed by Global Trust, may be indicative of the relatively weak pressure for Crab sustainability seals. - Growing fisheries in Chile and Argentina may be potential candidates for FIPs.

21 Crab > Swimming Crabs Swimming Crab Summary

Some additional swimming crab targets remain for FIPs • India, Malaysia, and Venezuela appear to have favorable market dynamics for blue swimming crab FIPs. • In total, these three countries would add about 50,000 tonnes of landings to FIPs, or about 6% of global swimming crab landings. • The United States also has room for expansion of market-based incentives, with just 20% of swimming crab landings in the MSC program and no FIPs.

China, and to a lesser extent South Korea, are important swimming crab producers, but market dynamics appear unfavorable for market interventions like FIPs • China produces a huge share (60%) of the world’s swimming crab, but China exports predominantly to Asian markets. Market programs have yet to gain a foothold in Chinese fisheries, which presents another barrier to creating a FIP for the swimming crab fishery. • South Korea is also a substantial producer (3.5%), but has tenuous ties to markets that value sustainable seafood.

Balancing depth vs. breadth • Although there are opportunities for expansion, swimming crab fisheries have proven to be very challenging FIPs. Opportunities for expansion should be balanced against the potential benefit of deeper investment in existing swimming crab FIPs. • The crab industry has pursued a strategy of serial exploitation to meet growing demand. To date, this strategy has been effective for the industry and may inhibit strong investment in FIPs (i.e., the Crab availability of underexploited crab fisheries is a disincentive to undertaking the difficult task of improving a fishery).

22 Crab > Swimming Crabs China is the key remaining target for market-based pressure on swimming crabs; South Korea, Venezuela, and Taiwan are also top producers without a market-based program Swimming Crab Landings Production Share Share of exports Share of production (thousand tonnes) volume exported sent to the EU15 within reach of Country Status 809 (swimming (all crab and US EU15 and US 20 Other crab) species) (all crab species) markets 5 8 Australia 8 Indonesia 81,844 91% 65% 59% FIP 10 Venezuela 27 Taiwan Thailand 31,376 81% 70% 57% FIP Mexico 31 Mexico 9,505 57% 98% 55% FIP S. Korea 32 Thailand Philippines 31,924 49% 49% 24% FIP Philippines Venezuela 7,620 21% 100% 21% No Program 82 Indonesia S. Korea 26,608 50% 18% 9% No Program

China 497,639 44% 13% 6% No Program 3% of total Australia 4,591 20% 3% 1% volume is MSC- 90 USA certified 20% of total United States 90,433 NA NA NA volume is MSC-certified 498 China Crab Taiwan, Province of 7,729 0% 0% 0% No program 2012 China * Note that some key producing countries (e.g., Vietnam) are missing from the list since they report all crab landings as crab NEI.

FAO Fishstat; International Trade Centre; www.msc.org; www.fisheryimprovementprojects.org. 23 Crab > Swimming Crabs Major barriers must be overcome to reach the next tier of blue swimming crab producers • China is the white whale of swimming crab producers, accounting for 60% of global production. Market-based incentives, however, have not yet been able to crack China beyond MSC CoC certifications and a couple of nascent FIPs. • The trade flows from China present an additional barrier. The majority of Chinese crab exports (80%) go to other Asian countries. Hong Kong (27%), Japan (18%), the China United States (17%), and Taiwan (11%) are the most important export markets for Chinese crab. • South Korea produces ~3.5% of the world’s swimming crab. • South Korea also produces a large quantity of spider crab (e.g., tanner crab), which may be clouding the trade data, but the bulk of crab exports go to Asian markets; Japan (63%), China (14%), and the United States(12%) are the main export markets for Korean crab. S. Korea • No FIPs or MSC certifications exist in S. Korea.

• Venezuela produces a relatively small amount of swimming crab (<1%). • Market dynamics may be the best among countries with no market-based programs; 100% of crab exports are destined to the United States market. • No FIPs or certifications exist yet in Venezuela. Venezuela • Political instability would be the major concern.

• Taiwan produces a small amount of swimming crab (<1%).

• Less than 1% of crab product is exported, so any market pressure for sustainability Crab would have to come from domestic markets. Taiwan

24 Crab > Swimming Crabs Some swimming crab FIP opportunities may exist in countries with low-quality crab landing data Several countries report substantial volumes of crab landings, but do not identify the species. Vietnam is one of these countries, which we know to be a major producer and exporter of swimming crab. Two other countries with substantial volumes of unidentified crabs, which are likely swimming crabs are Malaysia and India. The NFI-Crab Council and other associated industry partners may provide additional insight into the potential relevance of Indian and Malaysian crab fisheries.

• India reports 32,000 tonnes of NEI crab landings, a large portion of which are likely swimming crabs. India’s swimming crab production is probably comparable to that of the Philippines and Thailand. • 34% of India’s crab exports are destined for the EU and United States. Asian countries receive almost all of the remainder; Singapore (37%) and China (14%) are the most important markets. India • The large volume going to Asian markets is a concern, but India may present a good remaining opportunity for a swimming crab FIP.

• Malaysia reports 13,000 tonnes of crab landings, a large portion of which are likely swimming crabs. This would put Malaysia roughly on par with Mexico in terms of total production. • 47% of Malaysia’s crab exports are destined for the United States. Other Malaysia important export markets include Vietnam (16%), Australia (12%), and Singapore (8%). Crab • Malaysia may also represent a good opportunity for an additional crab FIP.

25 Crab > Spider Crabs Canadian (MSC), US (ASMI), and Russian (FIP) spider crab fisheries are involved in market-based programs; N. Asian producers are not engaged in programs

Share of exports Share of Production Share exported sent to the EU15 production within Country volume Status (all crab species) and US reach of EU15 and (spider crab) (all crab species) US markets Canada 84,372 75% 66% 49% MSC-certified

South Korea 35,087 50% 18% 9% No market program

Russia 29,275 97% 18% 17% Far East Crab FIP

USA 27,223 NA NA NA ASMI-certified

Japan 22,574 23% 6% 1% No market program

Crab

26 Crab > Spider Crabs Asia is a major consumer of spider crabs, which makes expansion of FIPs a challenge • The bulk of US snow crab catch comes from Alaska, which has chosen to pursue ASMI certification. • Trade data does not differentiate between species of crab, but the main market for Alaskan crab is Japan, which does not have strong demand for sustainable seafood. Alaska (USA) • Dynamics for Alaskan crab seem to be unfavorable for a FIP or MSC certification at this time.

• Japan’s major spider crab fishery is red snow crab. There is a robust local market for spider crabs – Japan is a major importer of crab from the United States and Russia. • The small share of crab that Japan exports goes to markets with no demand for sustainable seafood – Namibia (29%), Taiwan (22%), S. Korea (15%), Hong Kong Japan (15%). • The prognosis for market-based programs in Japan’s spider crab fisheries seems poor, unless sustainable seafood demand is cultivated in Japan and other N. Asian markets.

• Korea’s major spider crab fishery is red snow crab, which has a robust domestic market. The crab that Korea does export goes primarily to N. Asian markets – Japan (63%), China (14%) – as well as the United States (12%). • The prognosis for market-based programs in Korea’s spider crab fisheries Crab S. Korea seems poor, unless sustainable seafood demand can be cultivated in Japan.

International Trade Centre. 27 Crab > Cancer Crabs Market programs have struggled to gain traction with Dungeness and edible crabs (cancer crabs)

Little leverage on European producers 99 100 France, Spain, and Portugal are the main markets for 3 Other European brown crab. These markets have little demand for 95 5 Chile sustainable seafood. 90 5 Norway 85 7 Ireland No market-based Opportunity in Canada and Chile is unknown 80 programs We know little about the market dynamics affecting 75 7 France Canadian Atlantic rock crab or Chilean mola crab. Further investigation is required to assess the potential for market- 70 10 Canada based interventions in these fisheries. 65 60 Market leverage appears to be limited SSMO Shetland inshore 55 Product is destined for the local market and the rest of Europe brown and velvet crab 26 UK – primarily France and Spain. Financial costs of certification 50 MSC-certified (280 tonnes were paid by a philanthropic fund, so it is unclear whether 45 or ~1% of total production) there is a true business case for certification. 40 35 Oregon Dungeness Crab – Seafood Watch seems to be a more important player for 30 MSC-certified & SFW yellow, Dungeness and Jonah crab fisheries 25 but leaving the MSC program in 2015 (10,500 tonnes) 20 Oregon Dungeness is dropping out of the MSC program 37 USA

Volume of cancer crab landings (thousand tonnes) (thousandlandings crab of cancer Volume because retailers continue to buy California Dungeness crab, 15 Jonah Crab – In a GMRI FIP which is not certified but has a yellow rating from MBA. 10 (4,685 tonnes) Additionally, most exported Dungeness goes to markets that do 5 not value sustainable seafood (e.g., China). In sum, the fishery Crab 0 Total – ~15,000 tonnes in is not seeing sufficient value from MSC certification. market-based programs Jonah crab is MBA red listed. The fishery is using the FIP to Landings data from FAO FISHSTAT. improve its rating and gain access to Northeast retailers. Trade data by value from International Trade Centre. 28 Crab > King Crabs Market dynamics of king crabs may not be well suited for additional FIPs King Crab: Barents Sea king The Barents Sea stock underwent an MSC pre-assessment and 34 crab is in a sustainability was recommended to proceed. It is unclear whether there is a 34 need for a FIP. 2 Norway incubator FIP 32 Southern King Crab: No US is the main export market, and sales are growing. There are 3 Argentina 30 program some management concerns, so there may be potential for a FIP. 28 ~80% of king crab production is exported; Japan is the main

Alaska King Crab: ASMI- 26 export market. With weak sustainability demands from the 8 USA certified 24 Japanese market, there is little incentive to move beyond ASMI.

tonnes) Management of the fishery is also quite strong already. 22 20 US is an important market for Chilean crab exports (20%), but Southern King Crab (5.6K 18 Asian markets are also key destinations (55%), which may limit

(thousand tonnes): No program 8 Chile potential for market-based programs. It is unknown whether Softshell Red Crab (2.3K 16 improvements are needed in the fishery. tonnes): No program 14 12 King Crabs: • The Barents Sea stock underwent an MSC pre-assessment 10 • Barents Sea king crab is and was recommended to proceed. It is unclear whether King Crab landings Crab King 8 in a sustainability there is a need for a FIP. 13 Russia 6 incubator FIP • The Far East crab FIP has not formally launched. It is • Far East Red King Crab unclear what improvements are needed (possibly IUU 4 is in an SFP FIP controls and harvest reductions). 2 • Japan (45%), US (35%), and Korea (14%) are key markets for Russian crab. 0 Crab

Landings data from FAO FISHSTAT. Trade data by value from International Trade Centre. 29 Lobster commodity analysis

30 Lobster > Overview Lobster: Introduction

Low volume, but high value With just 300,000 tonnes of annual wild capture production, lobster fisheries represent a small portion of global fisheries landings. But, with average prices on the order of $20 per kilo for internationally traded product, lobster is an economically important species on the global market. On a per-pound basis, lobster is the most valuable of all the major seafood commodities.

Brief product overview Lobster can be broken into a few main product groups: clawed lobster, spiny/rock lobster, and langoustines. • Clawed lobster – Canada and the United States dominate global production of clawed lobster, which is commonly sold live or whole. Clawed lobster is also processed into tails, which also yields claw and knuckle meat. • Spiny lobster is produced in warm water regions, with significant production in Australia, Central America, and South Africa. Some product is sold live, but the dominant form is frozen tails. • Langoustines, commonly known as scampi in the market, are produced primarily in Northern Europe and caught with trawlers. The main importing countries are in Southern Europe (France, Italy, and Spain), and product is typically in the form of fresh or frozen tails.

Lobster

31 Lobster > Overview Top 10 Producers: The US, Canada, and UK dominate global lobster production; warm-water production is more widely distributed

2012 Capture Wild-capture lobster production by fishing country (Tonnes)

80,000 74,790 70,039 70,000

60,000 54,040 50,000

40,000 35,812

30,000

20,000 13,549 10,674 9,835 9,761 10,000 7,386 4,467 4,427 0 Canada United United Indonesia Ireland Australia Bahamas Brazil Cuba Nicaragua Other States Kingdom

Lobster

FAO Fishstat. 32 Lobster > Overview Top 10 Exporters: The US and Canada are the largest exporters; Australia, N. Zealand, and S. Africa are major suppliers to Asia

2014 Exports (USD millions) Top lobster exporters and their largest trading partners $1,400

$1,300 Other Belgium $1,200 H. Kong Japan $1,100 China

$734 $700 Other Other $600 Spain H. Kong $500 H. Kong Italy $400 USA China Other Other Ireland Japan Other $300 Other Other China H. Kong Spain Vietnam H. Kong Spain Ger. China France $200 UK Italy Germany Canada Italy USA France France Other Italy Spain Vietnam $100 China Italy Portugal Australia Belgium France USA $0 Lobster Canada USA Australia United New South Ireland Spain Brazil Netherlands Other Kingdom Zealand Africa

Exporting countries 33 Lobster > Overview Top 10 Importers: The US and Canada are the only major importers of lobster with strong sustainability commitments

2014 Imports (USD millions) Top lobster importers and their largest trading partners $1,300 Other $1,200 Nicaragua Bahamas Honduras Other $1,100 Brazil UK Canada Other S. Africa S. Africa $600 Australia USA $506 $500 Other Denmark Spain $400 Canada Nicaragua Other Ireland Neth. Canada Canada Other Bahamas Other $300 USA Spain Other Canada Cuba Australia Ireland Cuba France Neth. Denmark Other Australia Bahamas Canada $200 S. Africa USA Neth. USA Australia France Nicaragua N. Zealand USA S. Africa Canada $100 USA UK Canada UK USA UK USA Canada $0 Lobster USA Vietnam China Canada France Italy Spain Hong Kong Japan Belgium Other Importing countries

International Trade Centre. 34 Lobster > Overview Top 10 Consumers: The US is the world’s largest consumer of lobster; S. Europe and parts of Asia are also large consumers

2011 Apparent Consumption (Tonnes Round Weight) Top lobster consumers

90,000 81,622 80,000

70,000

60,000

50,000 44,563 40,000

30,000 25,885 24,698 21,570 19,961 20,000 15,643 12,276 10,816 9,752 10,000 7,124

0 USA France Canada United Italy Spain Hong Taiwan China Indonesia Other Kingdom Kong Lobster

FAO Fishstat; FAO product to round weight conversion factors; CEA analysis. 35 Lobster > Overview Top Producers: Lobster production can be broken down into

clawed, spiny, langoustines, and slipper lobstersDenmark

Sweden

Iceland

Ireland

France Other

Lobster Landings Langoustines Italy UK

(thousand tonnes)

291 2 Slipper Lobster 2012 33 10 4 3 2 2 1 4 59 Langoustines 59

Spiny Lobster 85 Dominican R.

Spiny Lobster

N. N. Zealand

Nicaragua

Indonesia

Honduras

Bahamas

Australia

Zanzibar

S. Africa S.

S. Korea S.

Mexico

Nigeria

Other

Brazil

Cuba

USA

Clawed Lobster 144 2 1 2012 14 12 9 7 4 4 4 3 3 3 3 2 12 85 2

2012 Clawed Lobster

Canada France

Legend* Other USA

MSC-certified or in UK

assessment

In a FIP 1 Lobster No FIP or MSC 2012 72 68 144 certification 3 1 FAO Fishstat. 36 *FIP or certification may only cover a portion of a country’s production. Lobster > Overview Most lobster producers that have tight connections to Northern EU and US markets are certified or in a FIP Market-based conservation programs engage fisheries accounting for more than half of global lobster production (by volume)

Clawed lobster largely MSC-certified already - Almost all of the landings from Canadian and US clawed lobster fisheries are MSC-certified. These fisheries make up approximately 98% of clawed landings globally.

Lobster FIPs have targeted spiny lobster fisheries, but few good candidates remain for additional FIPs - Almost all of the largest spiny lobster producers that are well-connected to EU and US markets are already in FIPs. - Jamaica, Belize, and the Dominican Republic have good market connections but produce relatively modest volumes (<1%, <1%, and ~3%, respectively). - Larger spiny lobster fisheries that are not in FIPs (Indonesia, New Zealand, S. Africa, Mauritania, Morocco, Cuba) have challenging market characteristics in that their exports go primarily to S. European or Asian markets with weak sustainability demands.

Langoustines as an unknown - Langoustines have so far remained largely outside the reach of market-based conservation approaches. We are not familiar with langoustine fisheries, but there are a couple of possibilities for the lack of market engagement to date, including: - S. Europe as the primary market – France, Spain, and Italy account for 80% of langoustine imports. These markets have fairly weak demands for sustainability. - Environmental concerns – Langoustines are caught primarily through bottom trawling, and the environmental challenges of bycatch and habitat impacts of this fishing method may be precluding the pursuit of market- Lobster based conservation tools.

37 Lobster > Clawed Lobster Clawed lobster is almost entirely MSC-certified or under assessment Clawed lobster landings UK/France – A small subset of European clawed lobster landings (thousand tonnes) are certified in the UK and France. 144 Fishery MSC status Estimated tonnage 1 Other 3 1 Normandy and Jersey lobster Certified 280 France Total 280 UK US – Landings in the Gulf of Maine, the source of most US clawed USA 68 lobster landings, are certified and under assessment. Fishery MSC status Estimated tonnage

Gulf of Maine lobster trap** In assessment 57,000

Maine lobster trap** Certified 57,000 Total ~57,000 ** These two certifications are of the same fishery, the result of a dispute over how to share the certificate of the original certification. Canada 72 Canada – Almost all lobster is MSC-certified or under assessment. Fishery MSC status Estimated tonnage Bay of Fundy, Scotian Shelf, and Southern In assessment 54,290 Gulf of St. Lawrence lobster trap Prince Edward Island lobster trap Certified 13,281 2012 Legend* Iles-de-la-Madeleine lobster In assessment 2,668 Lobster MSC-certified or in Gaspesie lobster trap Certified 1,032 assessment Eastern Canada Offshore lobster Certified 720 In a FIP Total ~72,000 No FIP or MSC certification * Certifications or FIPs may only cover a portion of the landings. 38 Lobster > Spiny Lobster With the exception of Cuba and S. Africa, every spiny lobster fishery that is closely linked to EU or US markets is certified or in a FIP

Share of Spiny Share of lobster Share production lobster exports sent to the US Country exported sold to EU15 Status production and EU15 (A) and US volume (B) (A x B) Honduras 1,556 70% 90% 63% WWF FIP Nicaragua 4,427 41% 94% 39% WWF FIP Cuba 4,467 54% 65% 35% No market-based projects Brazil 7,386 36% 87% 32% SFP FIP Bahamas 12,051 24% 93% 23% WWF FIP South Africa 2,507 90% 25% 22% No market-based projects ~50% of production is MSC- Mexico 3,041 30% 71% 21% certified Dominican Republic 2,505 18% 76% 14% No market-based projects ~60% of production is MSC- Australia 9,195 59% 3% 2% certified Nigeria 4,289 1% 100% 1% No market-based projects New Zealand 3,406 78% 0% 0% No market-based projects Indonesia 13,549 34% 0% 0% No market-based projects South Korea 1,303 1% 14% 0% No market-based projects Zanzibar 1,682 0% 0 0 No market-based projects

Lobster

39 Lobster > Spiny Lobster Potential reasons for a lack of market-based programs for spiny lobster in South Africa, Cuba, and Dominican Republic Based on the trade and production data analysis on the previous slide, South Africa, Cuba, and the Dominican Republic appear to be good candidates for additional lobster FIPs (i.e., the EU and US buy a large share of production). But digging deeper into the data reveals that the Dominican Republic may be the only country that is a good candidate.

• Although the United States imports ~22% of South African lobster, Asia is the main market, importing about 70% of South Africa’s lobster production. • Top importers from South Africa are Vietnam, the United States, China, Hong Kong, and Japan.

South Africa

• Setting aside the political challenges of working in Cuba, Cuba sells primarily to markets with little pressure for sustainability. • Top importers of Cuban lobster are Spain (57%), Japan (14%), and Taiwan (8%). • With the opening of relations between Cuba and the United States, it is unclear how these trade Cuba dynamics may change in the future.

• The Dominican Republic could be a good target for the next lobster FIP. More than 75% of the country’s exports are sent to the United States. • The key questions for are whether the domestic market is as important as the trade data indicate (more than 80% of product stays in the domestic market), and how that would impact a market-based approach. Much of this domestic consumption serves the tourist market, which could be another Lobster Dominican avenue to exert market pressure. Republic

40 Lobster > Spiny Lobster Getting into the long tail of spiny lobster producers, some additional Caribbean and W. African countries are candidates for additional market engagement, but all have serious drawbacks

• Japan accounts for 1.5% of global spiny lobster production, almost all of which is destined for the domestic market. Building domestic demand for sustainable seafood seems to be a prerequisite for Japan market pressure to influence Japanese lobster fisheries. • Morocco produces 0.75% of global spiny lobster, and approximately 80% of production is destined for EU markets. But the main countries that Morocco exports to, Spain and Portugal, are laggards in sustainable seafood demand. • Without additional market development in S. Europe, pushing sustainability demands onto Moroccan Morocco lobster fisheries seems like a futile endeavor.

• Mauritania produces 1% of global spiny lobster, and approximately 55% of production is destined for EU markets. However, the main EU countries to which Mauritania exports (Spain, Italy, Portugal) are laggards in sustainable seafood demand. Mauritania also exports substantial volume to Vietnam, China, and Taiwan. Mauritania • Market leverage on Mauritanian lobster fisheries appears to be weak at the present time.

• Based solely on trade statistics, Jamaica could be a good candidate for a FIP. Almost all of the product is exported to the United States (80%), and the second-largest market is France (14%). • However, production quantity is quite low, representing <0.5% of the world’s total spiny lobster Jamaica production.

• Belize accounts for just under 1% of global spiny lobster production. Most of the product is exported, with 90% destined for the US market. EDF is already heavily involved in the lobster and conch fishery in Belize, and it is unclear whether the addition of a FIP would provide any additional leverage. Lobster Belize

41 Lobster > Spiny Lobster Without cultivation of new markets that demand sustainable seafood, there are few attractive candidates for additional market engagement with spiny lobster fisheries

Potential for market engagement with additional spiny lobster fisheries seems low Of the top 15 spiny lobster producers that are not currently certified or engaged in FIPs, few exhibit the ideal characteristics for market engagement. The largest producers (e.g., Indonesia, South Africa, New Zealand), ship their product primarily to Asian markets that do not value sustainability. Some of the more modest producers export to the EU (e.g., Cuba, Morocco, Mauritania), but the main markets are S. European countries that have not embraced sustainability. The best candidates (e.g., Jamaica, Belize, Dominican Republic) produce relatively small amounts of lobster, and the effort required to create a FIP or pursue certification would need to be weighed against the possible impact on the commodity.

Supporting existing FIPs appears to have more potential for impact than spreading a wider net for spiny lobster Although FIPs are present in many of the largest spiny lobster fisheries, significant effort is needed to see them through to durable results on the water. The Honduran and Nicaraguan FIPs are quite new, and the Brazilian lobster FIP has experienced a number of challenges. Strengthening these existing FIPs would cover approximately 30% of global spiny lobster landings. The prime candidates for additional market engagement would add small amounts of volume (e.g., DR 3%, Belize 0.75%, Jamaica 0.5%). Full transformation of the commodity would require tackling fisheries where the market dynamics are not currently aligned (e.g., Indonesia, W. Africa, New Zealand, Japan). In addition, some of the countries with MSC certifications for spiny lobster have substantial portions of landings that remain uncertified Lobster (e.g., Mexico, Australia).

42 Lobster > Langoustines Market-based programs for conservation have not reached the largest langoustine fisheries (e.g., Norway lobster)

Mediterranean countries are the main importers of langoustines France, Italy, and Spain account for more than 80% of langoustine imports; these countries do not have strong demand for sustainable seafood.

Fishing method may be a barrier to certification Like shrimp, Norway lobsters are caught using bottom trawls. These fisheries catch substantial bycatch and negatively impact habitat, which may make widespread certification a challenge.

We are uncertain about prospects for langoustines We are not familiar with langoustine fisheries. Although there appear to be some barriers to applying market-based mechanisms for the commodity group, we cannot judge the prospects with confidence.

Lobster

43 Lobster > Markets Based on import data, developing sustainable seafood demand in S. Europe and Asia could expand pressure on lobster fisheries

Top lobster importers $1,000 $934

$900

$800 Legend Markets with strong $700 sustainability demand Markets with limited $600 sustainability demand Markets with no/weak $500 $467 sustainability demand $399 $400

$274 $300 $261 $254 $247

$200 $181 $164 Lobster Imports 2013 (USD millions) (USD 2013 Imports Lobster $107 $81 $100 $59 $46 $28

$0

UK Lobster

USA

Italy

Spain

China

Japan

Others

Taiwan

France

Canada

S. Korea S.

Belgium

Vietnam Hong Kong Hong

International Trade Centre. 44 Octopus

45 Octopus > Overview Top 10 Producers: China is the world’s largest octopus producer

2013 Capture (Tonnes) Top Octopus Producers

120,000 116,828

110,000

100,000

90,000

80,000

70,000

60,000 57,987 54,039 50,000 39,364 40,000 33,400

30,000 24,847 24,266 20,000 16,689 12,075 11,750 8,771 10,000

0 Octopus China Morocco Indonesia Japan Mexico Mauritania South Spain Portugal Thailand Other Korea

FAO Fishstat. 46 Octopus > Overview Top 10 Exporters: China, Morocco, and Spain are the world’s largest octopus exporters

2014 Exports Top octopus exporters and their largest trading partners (USD millions) $700 $650 Other $600 USA $550 Taiwan $500 H. Kong

$450 Other Greece $400 Japan Portugal $350 $300 Italy Other Other Germany Portugal Other Other $250 Greece Korea Belarus France Other Japan Russia Brazil Other $200 Greece Other Other Italy Italy USA Italy Japan France Switz. Korea USA USA Vietnam $150 Korea H. Kong France Spain Japan Portugal Japan USA USA Greece $100 Italy Spain Italy Spain Germany Spain $50 Italy Japan Korea Spain Korea $0 Italy China Morocco Spain Mauritania Vietnam Portugal Thailand Indonesia Mexico Italy Other Octopus

Exporting countries

International Trade Centre. 47 Octopus > Overview Top 10 Importers: Asia and S. Europe are the main importing markets for octopus 2014 Imports Top octopus importers and their largest trading partners (USD millions) $500 Other Indonesia $450 Mauritania Other $400 Thailand Thailand Other Mexico $350 Vietnam

Vietnam $300 China Morocco Other $250 Mauritania Other Senegal Tanzania Portugal $200 Mauritania Mexico Other Morocco Mauritania Mexico $151 Portugal Mauritania Other Other $150 Philippines Senegal Senegal Other China Indonesia Other Morocco Mauritania Mauritania Peru China $100 Italy Italy Morocco Portugal Indonesia Morocco Morocco Madagascar India $50 China Spain Spain Italy H. Kong Spain China Spain Spain Thailand Spain $0 Octopus S. Korea Japan Spain Italy USA Portugal Hong Greece France Vietnam Other Kong Importing countries

International Trade Centre. 48 Octopus > Overview Top 10 Consumers: N. Asia and S. Europe are the main consumers of octopus

2011 Apparent Consumption (Tonnes Round Weight) Top Octopus Consumers

120,000 113,542 110,000

100,000

90,000 84,425 78,984 80,000

70,000 61,434 60,000 54,009 50,000

40,000 29,137 30,000 25,801 19,211 20,000 14,621 13,688 10,299 10,000

0 Octopus South Japan Italy China Indonesia Spain USA Thailand Portugal Greece Other Korea

FAO Fishstat and CEA analysis. 49 Octopus > Overview Market incentives have not gained much traction with octopus

fisheries South Korea South

2011 octopus landings by country Mauritania

Indonesia

Morocco

Portugal Senegal

(thousand tonnes) Mexico

Japan

China Spain

Other

336 124

34 31 25 19 18 14

9 9 8

44

9

118 336

34 31 25 19 18 14 43

7 9 8

<1 1

Beaver Street Beaver Artisanal Asturias Western Ventures Blue Madagascar

Market-based programs

MSC-certified or in

assessment

In a FIP

No FIP or MSC certification Octopus

FAO Fishstat; www.msc.org; www.fisheryimprovementprojects.org. *FIP or certification may only cover a portion of a country’s production. 50 Octopus > Overview Market dynamics, fishing methods, and the low value of octopus make it a challenging commodity for market-based approaches Low sustainability demands in key octopus markets present barrier to adoption of market-based programs • Just 2% of octopus fisheries are in the MSC program or a FIP. • Markets for exported octopus are primarily in Asia and Southern Europe: Japan (26% of global exports), South Korea (17%), Italy (14%), and Spain (14%). • The US is the only main importer of octopus that has sustainability demand. The US imports 5% of globally traded octopus, primarily from Spain (28%), China (19%), the Philippines (11.5%), Indonesia (8%), and Japan (8%).

Fishing methods are also a barrier • Large-scale octopus fisheries typically use bottom trawl gear with low target-catch to bycatch ratios, which may be a barrier to engagement with sustainability oriented programs.

Few clear additional opportunities • Market-based programs have successfully engaged some artisanal fisheries. There may be an opportunity for more FIPs in these small-scale fisheries (e.g., Mexico), but they are generally low volume.

Octopus

51 Pangasius and other catfish

52 Pangasius > Overview Top 10 Producers: Vietnam, Indonesia, and China account for almost 65% of global catfish production

2013 Production (Thousand Tonnes) 1,300 1,210 Wild Capture 1,200 1,145 Aquaculture 1,100 189 993 1,000 900 800 700 600 500 956 993 461 400 314 299 300 9 299 132 218 184 166 200 126 290 147 21 4 98 100 182 163 163 111 29 162 71 16 69 0 Vietnam Indonesia China Nigeria Bangladesh India Thailand United Brazil Malaysia Other States

Pangasius

FAO Fishstat. 53 Pangasius > Overview Top Exporters: Vietnam controls almost all of the international pangasius market; China may be a growing player; and Indonesia has developed a domestically focused industry

2013 Exports USD millions Top catfish/pangasius exporters and their main trade partners $1,800 $1,698

$1,600

$1,400 Other $1,200

$1,000 Australia Saudi Arabia $800 China *Other consists Colombia Netherlands primarily of intra-EU $600 Spain trade ($140M), Mexico Indonesia ($25M), $400 Brazil and Thailand ($7M) $196 $200 USA $70 USA $0 Hong Kong Pangasius Vietnam China Other* Exporting Countries

International Trade Centre. 54

Pangasius > Overview Top Importers: US, Mexico, Brazil, and EU are the primary export markets for pangasius

2013 Imports USD millions Top pangasius importers and their main trade partners $600 $559 $550 $500 $450 $400 Other $350 China $300 $250 $200 Vietnam $150

$100 Other Other Other Other Other $50 Vietnam Other Other Other Vietnam Vietnam Vietnam Vietnam Vietnam Vietnam Vietnam $0 Pangasius USA Mexico Spain Netherlands Germany Brazil Russia Colombia UK Other Importing Countries

International Trade Centre 55

Pangasius > Overview Apparent Consumption: According to production and trade data, China, Indonesia, and US are the largest catfish consumers, but resolution of trade data may limit this assessment’s accuracy

Top catfish and pangasius consumers 900 818 792 800

728

700

600

500 405 400

300 264

195 2011 Apparent Consumption 2011 Apparent (1,000 Tonnes Round Weight) Round (1,000 Tonnes 200 182 133 123 116 100 83

0 China Indonesia USA Nigeria India BangladeshThailand Brazil Spain Malaysia Other Pangasius

FAO Fishstat; FAO product to round weight conversion factors. 56 Salmon

57 Salmon > Overview Top 10 Producers: The top 4 producers supply more than 80% of salmon by volume

2013 Production (Thousand Tonnes) 1,200 1,169 Wild Capture 1,100 Aquaculture 1,000 900 800 700 638 600 504 500 445 400 300 485 422 195 200 154 118 76 100 182 18 43 12 14 0 Norway Chile USA Russia Japan United Canada Faroe Australia New Other Kingdom Islands Zealand Salmon

FAO Fishstat. 58 Salmon > Overview Top 10 Exporters: Most of the main salmon exporters produce farm-raised product

Exported Value 2014 (USD billions) Top salmon exporters, their trade partners, and estimated share of product from aquaculture $7.5 100% $7.0 Share of exports $6.5 XX% estimated to be from aquaculture $6.0 Other Primarily re- $5.5 packaged product $5.0 from Norway Primarily re- packaged product Processing hub for $4.5 Germany from Norway all major producers USA Primarily re- $4.0 (e.g., US, Chile, Primarily re- Neth. 100% 100% packaged product Norway, Russia, $3.5 Russia from Norway packaged product Faroe, Japan, UK, from Norway and Sweden Other $3.0 Other Canada) Faroe Islands Spain $2.5 UK Russia 100% Italy 100% 6% $2.0 Denmark Brazil Spain Ireland ~50% 93% 100% 100% UK $1.5 UK China Italy France Japan China Australia Neth. France France Japan $1.0 France Canada Japan Italy Austria Germany UK Germany France USA $0.5 Poland Poland Germany USA USA $0.0 USA Salmon Norway Chile Sweden UK Poland USA China Canada Denmark Germany Other Exporting Countries

FAO Fishstat; International Trade Centre. 59 Salmon > Overview Top Importers: EU and US are the key markets for salmon exports

Imported Value 2014 (USD billions) Top salmon importers, their trade partners $9.0 $8.7 Approximately $4.2 billion of Other “other” imports is by EU28 countries $3.0 Other Faroe Isl. Other $2.5 UK UK USA China Neth. Other Other $2.0 Norway Chile China Canada Ireland Thailand Lithuania USA Other Norway Canada China Sweden UK $1.5 USA Chile Japan Other Faroe Isl. UK $1.0 Dnk. Russia Russia Poland Norway Norway UK Sweden Chile Norway $0.5 Norway Norway Poland Chile Chile USA $0.0 Salmon Sweden USA Germany Japan France Poland China Other Importing Countries

60 Salmon > Overview Top 10 Consumers: Russia, US, Japan, China, and N. EU countries are key salmon consumers; Russian apparent consumption may be overstated due to lower-quality trade data

597 600 550 503

500 470

450 425 400 350 300 252 250 200 176 142

150 142 133

2011 Apparent Consumption 2011 Apparent (1,000 Tonnes Round Weight) Round (1,000 Tonnes 100 86 83 50 0 Russia USA Japan China France United Germany Norway Canada Chile Other Kingdom Salmon

FAO Fishstat; FAO product to round weight conversions 61 Salmon > Overview A large share of salmon—especially salmon from Alaskan fisheries—is already MSC-certified; gaining a stronger foothold in Russia and Japan is the next frontier Legend MSC-certified or in assessment 3,366 No MSC

2013 salmon landings by country certification

Canada

Russia Other (thousand tonnes) Japan Wild USA

1,109

Capture

2 485 422 182 1,109

18

USA

Farmed 2,257 27 455 3 12 1,109

Alaska Alaska Salmon Islands Salmon Reserve Annette Ozernaya Sakhalin Island Salmon Salmon Island Pink Iturup Chum and Delta VA Kamchatka Pink Salmon BC Salmon Chum BC Salmon Sockeye BC

Salmon

2013

FAO Fishstat; www.msc.org. *FIP or certification may only cover a portion of a country’s production. 62

Shrimp

63 Shrimp > Overview Top 10 Producers: Farmed producers in Asia are the largest suppliers of shrimp worldwide

2013 Production (Thousand Tonnes) 2,400 2,338 Top Shrimp Producers

2,200

2,000 Wild Capture 1,800 Aquaculture 1,257 1,600

1,400 1,245 1,200

1,000 864 807 759 800 240 680 266 600 1,081 390 376 400 311 623 541 188 200 158 149 134 486 290 329 304 108 121 149 128 0 Shrimp China Indonesia Vietnam India Thailand Ecuador Mexico Malaysia Canada USA Other

FAO Fishstat. 64 Shrimp > Overview Top 10 Exporters: Farmed shrimp producers are the main exporters, with the US, EU, and N. Asia as their key trade partners

2014 Exports (USD millions) Top shrimp exporters and their largest trading partners Share of shrimp production from 43% XX% 35% $6,000 aquaculture Other UAE 100%

$3,500 Other Canada 98% 46% 72% $3,000 87% Other $2,500 Vietnam Other Belgium Other UK Germany Japan Neth. Canada $2,000 Italy Other 0% 0% 0% 100% Korea France Vietnam China Spain Other Other $1,500 Taiwan Japan Other UK Germany Vietnam Other Germany Japan Japan Italy Japan Italy USA Vietnam Japan $1,000 Norway China Morocco Neth. USA UK Italy France UK USA USA Belgium $500 H. Kong USA USA USA Germany Malaysia Spain Sweden Belgium $0 Shrimp India Vietnam Ecuador China Indonesia Thailand Denmark Argentina Neth. Bangladesh Other Exporting countries

International Trade Centre. 65 Shrimp > Overview Top 10 Importers: The US and N. EU, which have demand for sustainable seafood, are important shrimp importers, as is Japan 2014 Imports (USD millions) $6,955 $7,000 6,704 Other

$5,000 Thailand

$4,500 Ecuador $4,000

$3,500 Vietnam $3,000 2,773

$2,500 Other Other Other Other Indonesia Indonesia China Morocco Other Bangladesh Other Other $2,000 Argentina Nicaragua Netherlands Other India Vietnam India Indonesia Thailand China Madagascar Denmark $1,500 Thailand Thailand Germany Other India Indonesia Ecuador Vietnam India Bang. India Ecuador India Spain Canada Neth. Belgium Vietnam Argentina $1,000 Thailand India Vietnam Morocco Bang. Ecuador India $500 Vietnam Ecuador India Argentina Ecuador $0 Neth. Shrimp USA Japan Vietnam Spain France UK Germany Neth. Belgium Italy Other

66 Shrimp > Overview Apparent Consumption: China, the US, and Japan are the main consumers of shrimp

Top Shrimp Consumers

2,000

1,816

1,500 1,416 1,289

1,000

500 451 430 2011 Apparent Consumption 2011 Apparent

(1,000 Tonnes Round Weight) Round (1,000 Tonnes 369 219 189 173 154 140

0 China United Japan Indonesia India South Mexico Vietnam Spain United Other States Korea Kingdom

Shrimp

FAO Fishstat; FAO product to round weight conversion factors; CEA analysis. 67 Shrimp > Overview Almost 60% of global shrimp production is traded internationally; it is the most valuable traded seafood commodity

Round Weight of Fish (million metric tons) -41% • Approximately 55% of shrimp 7.0 6.9 production is farmed. 6.5 • Globally, shrimp exports in 2011 6.0 were valued at almost 20 billion 5.5 USD, making shrimp the most 5.0 3.8 valuable traded seafood 4.5 4.1 commodity. 4.0 3.5 3.0 2.5 2.0 Exports 1.5 3.1 1.0 0.5 0.0 2011 Global Volume Exported Shrimp Production Shrimp

FAO Fishstat; product weight to round weight conversions from FAO. 68 Shrimp > Cold Water

Shrimp: Cold-water shrimp is largely certified

United States United

Netherlands

Greenland

Germany

Denmark

Norway

Canada Russia

2010 wild capture Other

shrimp landings

(thousand tonnes) 10

164 124 433

26 22 19 18 39

10

3,043

Cold-water 433

12 17 17 11 10

4

120 433

68 60 29 15 25

5 3 4

6 2 7 3 4

7 1

Scotian Shelf Scotian Prawn N. Shrimp Sea Brown North Prawn Water DeepSweden Scotian Shelf N. Prawn Shelf N. Scotian Shrimp N. Striped Offshore Gulf Lawrence ofSt. Greenland W. Prawn Prawn Water Cold Deep Prawn E. Arctic Skagerrak Denmark Prawn Arctic NE Estonia Islands Faroe Prawn Deep Water Mozambique North Sea Brown Shrimp Brown Sea North 4

Warm-water 2,610

Market-based programs Cold-water shrimp MSC-certified or in • More than three-quarters of the global assessment production of cold-water shrimp is already 2010 In a FIP in the MSC program. Shrimp No FIP or MSC • Mozambique deep water prawn is the only certification FIP for cold water species.

FAO Fishstat; www.msc.org; www.fisheryimprovementprojects.org. *FIP or certification may only cover a portion of a country’s production. 69 Shrimp > Warm Water Progress in tropical shrimp fisheries remains elusive; market pressure seems insufficient for the scale of difficulty in these fisheries

2010 warm-water shrimp United States United

landings by country Philippines

Argentina

Indonesia

Myanmar

Malaysia Australia

S. S.

Thailand

Vietnam

Pakistan Mexico

(thousand tonnes) Korea

Other

China

Brazil

India

31 22

1,135 2,610

268 220 135 116 263

91 72 62 53 41 40 38

22

31 55 53 12

1,125 2,610

116 268 220 135 253

29 10 62 72 41 40 38 10

6

22

1

8 1 2

Malaysia Magdalena Bay China (Shantou) Shrimp Chinese India Indonesia States United LA, TX FL, GoCShrimp Australia N. Prawn Gulf Prawn Exmouth Prawn Shark Bay Seabob Suriname

Warm-water shrimp • Market-based programs Less than 5% of warm-water shrimp fisheries are in the MSC program or a FIP. • Weak governance in fishing countries, significant environmental issues with these MSC-certified or in fisheries, and the availability of cultured product (roughly 60% of traded product) assessment conspire to make the market pressure on these fisheries insufficient for the scale of In a FIP change needed. Shrimp No FIP or MSC • The GoC industrial fishery probably has the best chances for certification among major certification warm-water shrimp fisheries in the near-term, but even that will be a heavy lift.

FAO Fishstat; www.msc.org; www.fisheryimprovementprojects.org. *FIP or certification may only cover a portion of a country’s production. 70 Shrimp > Farmed Data on certification of farmed shrimp is confidential; we hope to add this information to future reports

2011 farmed shrimp production by country

(thousand tonnes)

Bangladesh

Indonesia

Malaysia

Thailand

Vietnam

Ecuador

Mexico

Other

China

Brazil

India

3,520

251 895 611 496 400 260 110

85 69 67

276

Shrimp

FAO Fishstat. 71 Small pelagic commodity analysis

72 Small Pelagics > Overview Market-based programs have been implemented primarily in

N. European, Mexican, and South American small pelagic fisheries Philippines

2011 small pelagic landings by country Indonesia

Denmark

Morocco

S. S.

Norway

Mexico

Iceland

Turkey

Russia

Korea

Other Japan

(million tonnes) China

India

Chile

Peru

USA

25

25

Herring Anchovy Anchovy Stock) (S. Stock) Anchovy (N. JackMackerel Anchovy and Sardine Sardines Herring Thread Sardine Oil Sardine Herring Capelin Sandeel Iceland Herring S. Philippines Turkey

Market-Based Programs Korea

MSC-certified or in

assessment

In a FIP

No FIP or MSC FIPs MSC in assessment MSC-certified

certification Panama small Australia blue grenadier Argentina anchovy pelagics Canada herring Canada herring French anchovy Faroe smelt * Peruvian anchoveta is still recognized as being in a FIP, French herring French sardine Small but based on our interviews we believe the FIP to be German herring Ireland herring Pelagics stalled. Netherland blue whiting Netherlands herring ** Excludes mackerel fisheries other than Chilean jack Spain sardine New Zlnd. blue whiting Sweden herring and sprat Sweden herring and chub mackerel that supply reduction markets. UK herring and mackerel UK herring FAO Fishstat; fisheryimprovementprojects.org; Marine Stewardship Council. *FIP or certification may only cover a portion of a country’s production. 73 Small Pelagics > Overview Small pelagic summary: As the sustainability bar, industry has settled on IFFO RS, which covers a large share of reduction fisheries Approximately 25% of small pelagic volume is engaged in a FIP or are in the MSC program

The fishmeal industry seems to have coalesced around IFFO RS, which already has certifications in fisheries that cover approximately 80% of small pelagic fisheries landings - If the conservation movement wants to drive further improvements in small pelagic fisheries, the sustainability bar for the fishmeal sector will need to be raised. - FIPs are present in the largest small pelagic fisheries that are not IFFO RS approved (e.g., Chilean jack mackerel, Baltic sprat, Morocco sardines). - More rigorous requirements are slated to come on line for aquaculture standards (e.g., ASC in 2017), but it is unclear whether they will transform the small pelagic industry.

Some discrete opportunities exist to work with fisheries that serve human consumption markets in Northern Europe - Fisheries that have pursued MSC certification are typically ones that supply the human consumption markets (e.g., herring). Some discrete opportunities may exist for further certifications, but volumes are low and lack of strong sustainability demands in S. Europe limit the potential of this approach.

Trash fish fisheries as the next frontier - SFP has been working on roundtables for SE Asian trash fisheries for several years. While not necessarily small pelagic fisheries, they serve the same fishmeal markets. Several FIPs are now underway (e.g., Ben Tre trawl, Kien Giang trawl), but the efficacy of the FIP approach in these very challenging fisheries is still a question in this early Small stage. Pelagics - The IFFO improvers program may become an important player for these reduction fisheries.

74 Small Pelagics > Overview Exports of small pelagic fish can be broken down broadly into

fishmeal and non-fishmeal Exports of small pelagic fish products other than fishmeal Round weight of fish estimate

(million tonnes) Netherlands

Germany

Morocco

Thailand

Sweden

Norway

Iceland

Poland

Russia

Other China

20

18

Non- 4 4 fishmeal 15

10

Exports of fishmeal by country 14 Fishmeal Round weight of fish estimate

5 (million tonnes)

estimated round weight of fish (million tonnes) (million fish of weight round estimated

– 14

0 exports

2011

USA Mexico Other Peru Chile Denmark Germany Iceland Ecuador Morocco Vietnam Thailand Russia Small

Pelagics

2011 2011

Fishstat. 75 Small Pelagics > Overview Currently, IFFO RS or Fish Source scores of 6 or greater are sufficient to meet sustainability demands from aquaculture for fish feed

Small Pelagics

76 Small Pelagics > Overview Most of the main small pelagic fisheries have IFFO RS certifications or Fish Source scores of 6 or more; raising the sustainability bar in the fishmeal sector will be required if further improvements are a priority

The fishmeal industry has coalesced around IFFO RS • “Most of the aquaculture people have gathered around IFFO RS. It is easy to identify what product is in the program, and for us the goal is to get our supply to IFFO RS.” Aquafeed representative • “ASC is starting to have some impact, and in 2017 it will require MSC-certified meal. I must say, that when the standard was made, it was in the belief that there would be pressure from the aquaculture industry on the fishmeal industry. The ASC does not have that power right now, and the aquaculture industry has declared that they would embrace IFFO.” – Aquafeed representative

The vast majority of reduction fisheries (80% of global volume) already supply IFFO RS approved fishmeal factories • As of 2014, IFFO RS certifications existed in fisheries that account for 80% of the volume of the main small pelagic reduction fisheries. • The largest volume fisheries that remain outside of IFFO RS are Chilean jack mackerel (In a stalled FIP), Baltic sprat (In a FIP), and Northwest African sardines (most landings a part of the newly initiated Moroccan sardine FIP).

The majority of small pelagic catch also meets FishSource score benchmarks1 • ASC currently allows for fishmeal from fisheries where each of the five FishSource scores of 6 or above. Two thirds of small pelagic reduction fisheries already meet this benchmark.

Small Pelagics

1. Sustainable Fisheries Partnership, 2014; Small Pelagics: SFP Fisheries Sustainability Overview 2014. 77 Small Pelagics > S. America Market programs have struggled to make progress in S. American small pelagic fisheries; low sustainability demands from the fishmeal industry and no links to EU food fish markets may be partly to blame

Small pelagic production: 7.4M tonnes Share exported: ~80% Share of small pelagic exports as fishmeal: 99%

Peru has been involved with several market-based programs for its anchovy fishery, but all of these efforts have stalled. Just a couple of years ago, the fishery was considered a prime candidate for MSC certification, but it has not moved ahead. Similarly, the fishery was in an SFP FIP starting in 2007, but in the last year the FIP stalled and is Peru no longer recognized as an active project. The shared border stock with Chile is still in a FIP, but is struggling to gain traction. The main producers are motivated to improve the fishery, with a primary objective to bring the artisanal sector, which is largely unregulated, into a more rigorous management system. The artisanal fleet is politically powerful, and industry has been unable to generate enough pressure to improve management in the fishery. Unfortunately, the FIP has not been able to tip the balance of political will. With a portion of the fishery already IFFO RS-certified, market demand for further improvements is somewhat muted.

Small pelagic production: 2.4M tonnes Share exported: ~66% Share of small pelagic exports as fishmeal: 99%

Chile has FIPs for all of its major small pelagic fisheries (anchovy, sardine, jack mackerel), but all three FIPs are struggling to make progress. The anchovy and sardine fisheries already meet the current bar for sustainability in the fishmeal industry (IFFO RS), and the main fishmeal producers are not active participants in the FIPs. The small-scale sector is the main stakeholder, and it is trying to leverage the FIP to access new food fish markets. It has yet to find a market that values sustainability, so the FIP seems to be struggling to bring enough pressure to drive meaningful improvements in the fishery. Small Chile Pelagics

78 Small Pelagics > Europe Capelin and sandeel have limited market engagement; these fish primarily supply the aquafeed market, and the limited human consumption goes to markets with few sustainability demands

Production: 853 thousand tonnes Main producers: Norway (42%), Iceland (38%), Russia (10%), Canada (3%) Key food export markets: Russia, China Capelin N. European capelin fisheries have not entered into a FIP or MSC certification. The two main stocks, Barents Sea and Iceland, have IFFO RS certifications, which is a sufficient sustainability bar for the fishmeal market. Product destined for human consumption, primarily roe, goes to E. European and Chinese markets that do not have sustainability demands.

Production: 443 thousand tonnes Main producers: Denmark (64%), Norway (25%), Sweden (7%)

The North Sea sandeel has been in a FIP since 2009, but activities have been limited to an annual Sandeel roundtable meeting and having industry representatives send a letter to fisheries managers once a year. N. European sandeel fisheries are IFFO RS-approved, so industry motivation is not strong to aggressively push beyond IFFO RS. The FIP, however, does provide a forum that helps stakeholders to stay abreast of sustainability trends in the fishmeal industry.

Small Pelagics

79 Small Pelagics > Europe Herring and sprat have seen more progress with market-based tools; their importance as food fish in N. EU markets with strong sustainability demands may be a driver

Production: 577 thousand tonnes Main producers: Denmark (28%), Turkey (15%), Sweden (10%), Poland (10%) Key food export markets: N. Europe

Sprat Denmark is the largest sprat producer; Danish product almost exclusively supplies the fishmeal market. The Danish fishery is in a FIP with the main aquafeed producers, EWOS, Biomar, and Skretting, as the main stakeholders. The North Sea stock of sprat is IFFO RS-approved, but the Baltic stock is not. Similar to the Danish sandeel FIP, activities have been limited to an annual meeting and drafting a letter to fisheries managers. These fisheries in the North Atlantic are reasonably well managed and there is little pressure in the feed industry for more demanding certification schemes. Sweden, on the other hand, sends a significant portion of its sprat to food fish markets that have strong sustainability demands, and a portion of the Swedish fishery is now undergoing MSC assessment.

Production: 2.5 million tonnes (Atlantic 70%) Main producers: Norway (25%), Russia (17%), Iceland (8%), Finland (4%) Key food export markets: N. Europe Herring Herring has been one of the biggest success stories for MSC. The fish is popular in N. European markets that have a strong demand for sustainability, and there are now 15 certified fisheries and an additional five in full assessment. More herring could be brought into the MSC program, but market pressure has already been applied and management fundamentals are quite good, so there is no significant need for FIPs. Not surprisingly, no FIPs target herring fisheries at present.

Small Pelagics

80 Small Pelagics > Sardines FIPs and MSC have made some headway with sardines, but there are few large sardine fisheries remaining that are good candidates for a FIP or MSC certification

2011 sardine landings by country

Netherlands

South South Africa

Mauritania Philippines

(million tonnes) Indonesia

Morocco

Senegal

Mexico

Nigeria

Belize Other

Japan

China

Chile

4.9

4.9

sardine Sardine Sardine and anchovy Californiaof Gulf Morocco Cornwall South Brittany Bay Biscayof Market-based programs

MSC-certified or in sardine

sardine assessment sardine

In a FIP sardine

Small

No FIP or MSC Pelagics

FIP certification

FAO Fishstat; www.msc.org,; www.fisheryimprovementprojects.org. *FIP or certification may only cover a portion of a country’s production. 81 Small Pelagics > Sardines Cultivating more demand for sustainable seafood in S. Europe may be required to unlock more sardine certifications or FIPs

Croatia – Sardine exports go primarily to S. European countries with limited demand for $557 $560 sustainable seafood (~65% to Serbia, Italy, Spain). Management improvements may be needed, but market pressure is limited. $540

$520 UK – The Cornwall sardine fishery is currently certified, but lands just 1,200 tonnes. The main Other export markets are S. Korea, France, the US, and Ireland. $500 Italy – Sardine exports go primarily to S. European countries with limited demand for $480 sustainable seafood (~75% to Spain and France). Management improvements may be needed, Croatia but market pressure is limited. $460 $12 $14 UK Canada – The Pacific sardine fishery is reasonably well managed. Exports mainly go to US $440 $18 Italy markets, which could support a market-based program. $420 $18 Canada Thailand – Thailand produces about 60K tonnes of sardines a year. Thailand is a difficult country for FIPs, and the market dynamics are somewhat challenging because S. Africa, Brazil, the US, and $400 $24 Thailand Japan are the largest export markets. $380 $35 Poland Poland – Poland is a relatively small sardine producer (24K tonnes), but it exports a large share of $360 its product to the US and N. Europe. Much of the exported product may in fact be sprat, which $340 falls under the same trade codes as sardines. Poland may be worth further investigation. $44 Spain $320 Spain – Spain exports a large share of sardines to the EU, but primarily to countries with limited demand for sustainable seafood: Portugal, France, and Italy. A portion of Spain’s sardine fleet in $300 the Bay of Biscay is MSC-certified (8,000 tonnes). It is unclear whether more of Spain’s sardine landings can be targeted. $280 Portugal – Portuguese sardine fisheries have important links to French, UK, and Spanish $260 $90 Portugal markets. The connection to the former two markets was a driver for the fishery to pursue MSC $240 certification in 2011. Since that time the fishery has been suspended from the program, Sardine exports to the EU15 theto 2014 US in and dollars) exports (million Sardine reinstated, and suspended once more. We are not aware of all the dynamics surrounding this Small $220 fishery, so we cannot say whether a FIP would help in securing the fishery’s MSC certification. Pelagics $215 Morocco Morocco – There are substantial sardine exports to the US and EU15 markets. Germany and $0 France are key markets. Germany has strong sustainable seafood demand, while France has 2011 relatively strong demand in comparison to other S. European countries. The new FIP seems to be well targeted. International Trade Centre. 82 Snapper and Grouper

83 Snapper and Grouper Snapper and grouper: Difficult context to achieve short-term success Several FIPs have been created in snapper/grouper fisheries, but to date they have proven difficult fisheries in which to achieve progress at a meaningful scale. Just one snapper complex is in the MSC program (Nicoya Peninsula in Costa Rica is under assessment), and snapper FIPs generally have achieved progress only within the fence- line of participating companies (e.g., they have not been able to influence fisheries management). In the near term, achieving substantial progress in existing snapper/grouper FIPs would be an important accomplishment, and would help make the case that market approaches can be successful in fisheries with challenging fisheries management and market contexts.

Unfortunately, production and trade data is not a very helpful tool when looking for leverage points in snapper/grouper fisheries. These species are often classified in broad product groups (e.g., fish not elsewhere included), which makes it difficult to tease out where EU and US markets have the potential for leverage.

Snapper and Grouper

84 Squid

85 Squid > Overview Top 10 Producers: Asian and S. American countries are the world’s leading squid and cuttlefish producers

2013 Capture (Tonnes) Top squid and cuttlefish producers

1,000,000 974,457

900,000

800,000

700,000 676,499

600,000

500,000 467,672

400,000

300,000 281,308 264,798 221,711 191,838 200,000 159,330 130,852 120,001 115,940 100,000

0 China Peru Vietnam South Japan Argentina Indonesia Taiwan USA Thailand Other Squid Korea

FAO Fishstat; FAO product to round weight conversion factors; CEA analysis. 86 Squid > Overview Top 10 Exporters: China, India, and Thailand are the world’s largest squid and cuttlefish exporters

2014 Exports (USD millions) Top squid and cuttlefish exporters and their largest trading partners $1,900

Other $1,100 Japan

$1,000 $948 $900 Taiwan

$800 USA $700

$600 Portugal Thailand Other $500 H. Kong Other Other Germany Italy Other Vietnam Croatia Other $400 China H. Kong Other Canada France China S. Korea Italy Japan USA Portugal Japan Other Italy Thailand Japan Italy $300 Thailand Canada Other S. Korea Spain Italy USA Vietnam Thailand Phil. Other $200 Thailand N. Zealand Japan S. Africa Vietnam $100 Spain Italy Spain Italy Spain China Spain $0 China Squid China India Thailand Spain Peru Morocco Vietnam USA Falklands S. Korea Other Exporting countries

International Trade Centre. 87 Squid > Overview Top 10 Importers: The main squid importing markets are in S. Europe and Asia 2014 Imports Top squid and cuttlefish importers and their largest trading partners (USD millions) $900 $851

$500

$450 Other Other $400 China Other

$350 Vietnam France Other France S. Korea Japan Other $300 India Taiwan Other China Indonesia Argentina $250 Thailand Other Taiwan Phil. Malaysia Other Other Falklands Indonesia India Morocco $200 Thailand China N. Zealand Other Taiwan Vietnam Argentina Thailand USA France $150 India Peru Vietnam H. Kong S. Africa Vietnam Phil. Peru Vietnam China $100 India Morocco China Spain India China $50 N. Korea China Thailand China Chile Spain $0 Squid Italy Spain China Vietnam Thailand USA Japan S. Korea Hong Portugal Other Kong Importing countries

International Trade Centre. 88 Squid > Overview Top 10 Consumers: The main squid consumption markets do not have well-developed demand for seafood sustainability

2011 Apparent Consumption (1,000 Tonnes Round Weight) Top squid consumers 1,000 906 900

800

700

600

500 434 400 315 300 243 241 200 160 142 134 123 122 121 100

0 Squid China Japan Peru South Chile Spain Italy Indonesia Thailand Taiwan Other Korea

FAO Fishstat; FAO product to round weight conversion factors; CEA analysis. 89

Squid > Overview Squid: Market programs have not had much traction with squid fisheries

2011 squid landings by country States United

Indonesia

Thailand

Vietnam S. S.

(thousand tonnes) Taiwan

Korea

Japan

China

Chile Peru

Other

3,452

820 407 310 272 250 167 164 150 121 111 681

3,452

816 407 310 272 250 167 164 117 121 111 603 33

4 77

Beaver Street Beaver California arrow Zealand New

squid

squid

Market-based programs MSC-certified or in assessment In a FIP Squid No FIP or MSC certification

Beaver Street Landings represents the landings processed in the FIP stakeholders facility. Overall fishery landings are higher. New Zealand Arrow Squid is in a Sustainability Incubator FIP, and under MSC full assessment.

*FIP or certification may only cover a portion of a country’s production. 90 Squid > Overview Market dynamics of squid and cuttlefish are challenging for the advancement of market-based interventions Few squid fisheries are certified or in a FIP • Just 6% of global squid landings are in a FIP or are MSC-certified. • The science of squid populations and fishery management is not well-established. Without strong population models, it is difficult to say what a FIP would aim to accomplish in these fisheries. • Southern European and Asian markets are important consumers for many of the largest squid fisheries, so there is limited market pull for sustainability.

Opportunities may be discovered by tracing US imports • The US is the only major squid importer with well-developed sustainable seafood demand. Tracing US supply chains may be the best way to identify additional FIP opportunities. The US imports squid primarily from China (60%), India (9%), and Thailand (9%). • The Chinese common squid FIP (Beaver Street), initiated in 2013, provides an interesting case study about how an exporter to the US can influence fisheries management in China.

Squid

91 Tilapia

92 Tilapia > Overview Top Producers: The world’s top three tilapia producers – China, Indonesia, and Egypt – account for more than 60% of global production

2013 Production Top tilapia producers (Thousand Tonnes) 1,800 1,658 Wild Capture 1,600 Aquaculture

1,400

1,200

985 1,000 38 794 800 739 103 293 600

947 400 318 636 49 247 34 210 179 502 200 9 142 269 102 99 213 169 54 70 Tilapia 0 48 29 China Indonesia Egypt Philippines Thailand Bangladesh Brazil Vietnam Uganda Mexico Other

FAO Fishstat. 93 Tilapia > Overview Top Exporters: China is the dominant exporter of tilapia, accounting for more than 60% of global exports by value

2014 Exports USD millions $850 Top tilapia exporters and their main trade partners

$800 Other $750 Peru Spain Canada $700 Russia Hong Kong $650 Israel

$600 Iran

$550 Mexico $500

Other $100 Other Other Neth. Mexico Other USA Spain USA S. Korea Peru Peru $50 USA Other USA USA USA USA USA Canada $0 Tilapia China Indonesia Honduras Costa Rica Colombia Vietnam USA Mexico Ecuador Other Exporting Countries

International Trade Centre. 94 Tilapia > Overview Top Importers: The United States imports approximately 65% of internationally traded tilapia by value

2014 Imports USD millions Top tilapia importers and their main trade partners $1,050 Other $1,000 Ecuador Mexico $950 Colombia $900 Costa Rica

$850 Indonesia $800 Honduras $750

$250

$200 Other $150 China Other Colombia Ecuador $100 Indonesia Other Other China Honduras Hong Kong Panama $50 Other China China China China $0 China Tilapia USA Mexico Canada Israel Iran Russia Costa Rica Other Importing Countries

International Trade Centre. 95 Tilapia > Overview Top Consumers: According to trade data, key producing countries are also the top consumers, which may be an artifact of poor product classification in the trade data

Top tilapia consumers 1,100 1,074 1,000

900

844 800 731 700 638 600 500 400 303

300 2011 Apparent Consumption 2011 Apparent (1,000 Tonnes Round Weight) Round (1,000 Tonnes 205 200 179 177 105 100 91 100 0 China Egypt IndonesiaPhilippines USA Thailand Brazil Bangladesh Vietnam Uganda Other

Tilapia According to international trade data, less than 10% of tilapia is traded. This seems extremely low, so we hypothesize that much tilapia is in fact classified under generic product codes (e.g., fish meat) that do not identify the commodity group. That said, there are some robust domestic markets for tilapia production (e.g., Indonesia).

FAO Fishstat. 96 Tuna commodity analysis

97 Tuna > Overview Tuna Summary: ISSF has strong coverage of tuna; potential gains could be made by improving coordination of FIPs below the RFMO level

Approximately 80% of global tuna landings are a part of ISSF efforts, in a FIP, or in the MSC program

Yellowfin and bigeye landed with gear other than purse seine offer the best opportunity for expanded FIPs • ISSF does not formally report on gear groups other than purse seines for YFT and BET. • Approximately 62% of the volume of these species is engaged with market-based programs.

Better coordination of tuna FIPs may improve efficacy of tuna FIPs • There are several examples of multiple FIPs working on the same fishery. Indonesia is the most obvious example, with ISSF working at the RFMO level, WWF executing a national tuna FIP, and several organizations (MDPI, IPNLF, PT Intimas Surya) operating on a specific gear type and/or a subnational level. These efforts are communicating with each other to a certain degree, but it is not clear whether the efforts enjoy much synergy or coordination.

Tuna

98 Tuna > Skipjack Through ISSF, the majority of skipjack tuna is already in improvement projects, while MSC covers ~25% of skipjack volume

Skipjack in ISSF “FIPs”

ICCATPole and Line

WCPFCPurse Seine

ICCATPurse Seine

IATTCPurse Seine Non

2012 volume (thousand tonnes) IOTCPurse Seine -

In an ISSF “FIP” ISSF Skipjack

Not in an ISSF “FIP”

1,410 2,501

266 173 111 463 78

Skipjack

78 91

1

2,501

186 796 110 422 251 173

80

2

20 97

Skipjack 179

Tri Marine Western and Indonesia Indonesia Tuna FIP Central Pacificskipjack Purse PNA Seine and pole skipjackline Japanese and pole skipjackline MexicoCaliforniaBaja Pacificpurse seine Northeastern Tropical Echabastar Skipjack PS and Handline Tuna Maldives Pole and Line Islands Pole Solomon and Line Indonesia Tuna (Non FIP Skipjack in all market-based programs 2012 volume (thousand tonnes) MSC-certified or in assessment

In a FIP

Tuna

No FIP or MSC

certification

-

PS)

FAO Fishtat; MSC; IATTC; ICCAT; IOTC; WCPFC. *FIP or certification may only cover a portion of a country’s production. 99 Tuna > Albacore 65% of albacore is also covered by ISSF or MSC

WCPFC & ICCAT pole and line WCPFCLongline

Albacore in ISSF “FIPs” ICCATLongline IOTCLongline and IATTC & ICCAT troll are the 2012 volume (thousand tonnes) largest albacore units that ISSF does not report on. In an ISSF “FIP”

Not in an ISSF “FIP” Non-ISSF Skipjack

101 112 267

31 24

Albacore

267

92 24 93

3 2 31 1 4

Albacore 6

4 5 3

Walker Seafood Australia Longline Fiji CFAIslands Cook SZLC, HNSFC& Canadian HMS AAFA and WFOA Pacific Pole Japanese and Line Zealand New Troll North Atlantic artisanal

Albacore in all market-based programs 2012 volume (thousand tonnes)

MSC-certified or in

assessment

In a FIP Tuna

No FIP or MSC

certification

*FIP or certification may only cover a portion of a country’s production. 100 Tuna > Yellowfin and Bigeye ISSF is working on purse seine yellowfin and bigeye, but a large

share is caught using other gears

WCPFCPurse Seine

ICCATPurse Seine IATTCPurse Seine

YFT & BET in ISSF “FIPs” IOTCPurse Seine 2012 volume (thousand tonnes)

In an ISSF “FIP”

Not in an ISSF “FIP”

Other

1,743

264 148 100 804

Bigeye & 427

yellowfin

10

1,743

389 184 119 100 656 127

30

Bigeye & 80

28

yellowfin

Walker Seafood Australia LL Meliomar Philippines WCPFCPurse Seine Indonesia national tuna (PS) FIP Islands PS Solomon Northeastern TropicalPacific Echebastar Indian Ocean MexicoPole and GoC Line Maldives Handline Pole and Solomons Line Marshall Islands Longline Micronesia Longline Panama YFT Indonesia national tuna (Non FIP

YFT & BET in all market-based programs 2012 volume

(thousand tonnes)

MSC-certified or in

assessment

In a FIP

Tuna

No FIP or MSC

certification

-

* Tri-Marine YFT under assessment, but no tonnage given for YFT. PS)

* Several FIPs operating in Indonesia underneath the national tuna FIP (e.g., MDPI, PT Intimas, and IPNLF).

*FIP or certification may only cover a portion of a country’s production. 101 Whitefish

102 Whitefish > Overview Top 10 Producers: Top whitefish-producing countries generally have strong fisheries management (e.g., US, Norway, Iceland)

2013 Capture Wild-capture whitefish production by fishing country (Thousand Tonnes) 2,400 2,355

2,200

2,000 1,919

1,800

1,600

1,400

1,200 1,140 998 1,000

800

600 465 345 400 290 186 200 162 149 147

0 Whitefish Russian United Norway Iceland Argentina Japan New Faroe Spain Namibia Other Federation States Zealand Islands

FAO Fishstat. 103 Whitefish > Overview Top 10 Exporters: Although China does not land any whitefish, it is a key processing hub and the world’s largest whitefish exporter 2014 Exports (USD millions) Top whitefish exporters and their largest trading partners $3,400 $3,259 Other France $1,800 Neth.

$1,600 Other $1,400 UK Other $1,200 Other France Korea Canada Brazil $1,000 Brazil Other UK Belgium Other UK Other $800 Italy Poland UK Other Japan UK Denmark Neth. UK $600 Germany Neth. France Other Other Germany Spain Israel Portugal Spain Portugal China Denmark Russia Germany China Germany $400 USA France USA Italy France S. Africa $200 USA Portugal China UK Portugal Spain France Brazil Spain $0 Italy Whitefish China Russia Norway USA Iceland Denmark Germany Sweden Argentina Namibia Other

Exporting Countries

International Trade Centre. 104 Whitefish > Overview Top 10 Importers: Many of the top whitefish importers have well- developed sustainable seafood demand 2014 Imports (USD millions) Top whitefish importers and their largest trading partners $3,777 $3,800 Neth. New Zealand

$1,600 Other

$1,400 Norway

$1,200 USA Faroe Islands $1,000 Argentina Other Russia Other Norway Russia Canada $800 Other Poland Russia Other Other Other Chile Other Denmark Germany Russia Argentina Norway Neth. Other Russia $600 Norway Denmark New Zealand Germany Russia Iceland USA USA Neth. China Neth. China Other $400 Norway France Spain Denmark USA Iceland China $200 Norway USA Russia China Iceland China Norway Namibia Sweden Iceland Iceland Whitefish $0 China Germany UK Spain France USA Portugal Sweden Japan Netherlands Other Importing Countries

International Trade Centre. 105 Whitefish > Overview Apparent Consumption: The US, Russia, Japan, and the EU are the main consumers of whitefish

2011 Apparent Consumption (Thousand Tonnes Round Weight) Top whitefish consumers 1,994 2,000 1,126 1,100

1,000 894 900

800

700 587 600 565 544 535 497 500 409 400 302 300 273

200

100 Whitefish 0 US Russia France Japan Germany Spain UK South Portugal China Other Korea

FAO Fishstat. 106 Whitefish > Overview The largest whitefish producers (Norway, US, and Russia) have

certified most of their whitefish landings

Norway

Russia

USA

5.3

2.4 1.9 1.0

5.3

Russiaof Okhotsk pollock Sea Arkhangelsk Trawlfleet Haddock & Cod FIUN Cod Pacific Longline Haddock and Cod Sea Russian Barents Fed. Alaska Pollock Alaska Pollock Pacific Trawl Hake Pacific Gulf of Cod Alaska Alaska PacificCod Redfish,USPollock Acadian Haddock, Haddock Arctic NE Norway Cod Arctic NE Norway Cod/Haddock/Saithe Sea Barents Saithe and Arctic NE Sea N. Norway

2013 Whitefish

Landings --

Million tonnes --

Gulf of Alaska Sea Bering

--

Bering Sea Bering

Legend*

MSC-certified or in

assessment

In a FIP Whitefish

No FIP or MSC

certification * Allocation of certified landings between Russia and Norway is not clear for the Barents Sea certifications.

FAO Fishstat; www.msc.org; www.fisheryimprovementprojects.org. *FIP or certification may only cover a portion of a country’s production. 107 Whitefish > Overview Just a handful of other large whitefish fisheries remain outside the reach of market programs (e.g., whiting, Japanese pollock, grenadier)

Legend*

2013 Whitefish MSC-certified or in United Kingdom United

Landings assessment

Faroe Islands Faroe New Zealand New Million tonnes Africa South

Argentina In a FIP

Namibia

Canada

Iceland

France

Other

Japan Spain Chile No FIP or MSC

certification

2.9

0.5 0.3 0.3 0.2 0.2 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.6

2.9

IcelandicHaddock Zealand New Trawl Hake SFSAGSaithe roundnose grenadier Scapeche Iceland Saithe and and Ling Iceland Saithe of S. Hake 41 Argenine of41 Hake N. Argentine/Uruguay Whiting NZ Blue Whiting Blue Faroese Saithe Faroe Saithe and Cod NE Faroe AGARBASpain Longline Hake Spain Haddock Sea N. SFSAG Saithe Haddock, Cod, Arctic NE UK Saithe UK/Doggerbank Gillnet Hake Cornish Africa Trawl Hake South Hake UnitsChilean IV Hake S. Chilean Haddock & Euronor and Cod Comapeche Saithe Euronor Malo St. Saithe Pacific Hake Scotia Canada Newfoundland Cod N. 3PsCod Canada Icelandic Cod Icelandic Other Includes PFA, DPPO, KFO Blue Whiting Poland E. Baltic Cod

Greenland Cod, Haddock, Saithe

Sweden SFPO E. Baltic Cod

-

Fundy Haddock Fundy

--

LFA Latvia E. Baltic Cod

Barents Sea Cod Sea Barents

Denmark DFPO N. Sea Haddock

Denmark DFPO N. Sea Hake

-

X

German E. Baltic Cod Whitefish Germany N. Sea Saithe

DFPO N. Sea and Skagerrak Saithe

Denmark E. Baltic Cod Peruvian Hake (FIP)

FAO Fishstat; www.msc.org; www.fisheryimprovementprojects.org. *FIP or certification may only cover a portion of a country’s production. 108

Whitefish > Overview Whitefish Summary: An ideal commodity for market-based interventions Ideal characteristics for market interventions Whitefish is an ideal commodity for market-based interventions. Approximately 90% of landed volume is traded internationally, though this figure is somewhat exaggerated by product that is shipped to processing hubs and subsequently exported again. Almost 60% of whitefish is consumed in countries with well-developed or developing markets for sustainable seafood. Almost all production takes place in countries with relatively strong fisheries management (e.g., EU, US, Australia, New Zealand, Norway, Russia).

Just a handful of targets remain, but most have challenging dynamics The largest remaining uncertified whitefish fisheries are S. American hake fisheries that primarily supply markets without strong demand for sustainable seafood (e.g., Spain); Japanese cod and pollock fisheries that largely supply domestic markets; and other fisheries that produce low-value species (e.g., blue whiting). A few whitefish fisheries that have been severely overfished also remain outside the reach of market programs.

Whitefish

109