Trident Seafoods’ boss charts safer course for Alaska fishing season The fishing industry is seasonal, presenting a challenge for a company trying to prevent the spread of a virus in an industry considered among the most hazardous in the US The Wall Street Journal by Julie Wernau - May 20, 2020 Joe Bundrant runs one of the world’s largest seafood companies. He knows that without healthy fishermen there will be no catch in the bountiful waters off Alaska’s coast. https://www.foxbusiness.com/industrials/trident-seafoods-boss-charts-safer-course-for-alaska-fishing-season FISH FACTOR: Efforts at seafood industry relief continue in Congress Alaska Journal of Commerce by Laine Welch - May 20, 2020 Giving COVID relief funds to the seafood industry and stepping on the gas for offshore fish farming are two big takeaways from the executive orders and congressional packages coming out of the nation’s capital. https://www.alaskajournal.com/2020-05-20/fish-factor-efforts-seafood-industry-relief-continue-congress Copper River closes for a week after poor sockeye showing Alaska Journal of Commerce by Elwood Brehmer - May 20, 2020 It’s been a very rough start to what was already a harried season for Copper River salmon fishermen. https://www.alaskajournal.com/2020-05-20/copper-river-closes-week-after-poor-sockeye-showing Environment/Science New study says marine heat waves will decimate fish at twice the rate climatologists previously predicted KMXT by Kavitha George - May 18, 2020 Over the last decade, two massive marine heatwaves, better known as “blobs” swept the North Pacific Ocean, raising surface temperatures more than 5 degrees Fahrenheit causing blooms of toxic algae and major die-offs in the ecosystem. A new study from the University of British Columbia reports that as these heatwaves continue, they may have far more devastating implications to fisheries than previously predicted. https://kmxt.org/2020/05/new-study-says-marine-heat-waves-will-decimate-fish-at-twice-the-rate-climatologists-previously-predicted/ FYI’s North Pacific Fishery Management Council May 2020 Newsletter First Virtual Council Meeting, IFQ Transfer Provisions, Charter Halibut Management Emergency Action, IFQ Vessel Caps, IFQ Rollover Increase & Season Extension https://www.npfmc.org/may-2020-newsletter/ BBRSDA Issues its Own COVID-19 Fishermen’s Handbook Fishermen's New - May 20, 2020 The Bristol Bay Regional Seafood Development Association (BBSDA) has posted its own COVID-19 Fishermen’s Handbook, online at https://static1.squarespace.com/static/56b0dfb660b5e98b87fc3d52/t/5ebf2f9d0ecfc828c105d061/1589587872581/BBRSDA+COVID+Handbook+-+05-15-20pm.pdf http://fnonlinenews.blogspot.com/2020/05/bbrsda-issues-its-own-covid-19.html Opinion The Winding Glass: With Restaurants, Believe What You See, Not What You Hope to See SeafoodNews by John Sackton - May 19, 2020 [The Winding Glass is the commentary and opinion column from John Sackton, Founder of SeafoodNews] This coming weekend is Memorial Day weekend. In many parts of the country, this is the kickoff for summer dining from neighborhood cookouts to eating fried clams at the shore. During this pandemic, simply being able to be outside may be all we can ask for. Our country has been hit hard. Seven states, with about 1/3 the population of the country, all individually have death rates higher than Hubei Province in China which shocked the world with its infection rate and lockdowns. In the first week of April I wrote in this column that for U.S. seafood distributors, “there will be no snapback in foodservice sales this summer, but instead a long adjustment period that may bring us to a totally new paradigm of seafood distribution…Two thirds of the value of seafood sold in the U.S. is consumed outside the home. If we are likely to see a long period where Americans are fearful to eat out, it will not be possible to keep the structure of the foodservice industry intact.” “Many restaurants will permanently close. The volumes going through distributors will shrink. New ways will have to be found to make Americans comfortable with seafood in the same manner they have been when they go out to eat.” So far, the month of May has been much better than April. In April, the door for orders slammed shut. Some seafood products were refused or returned. But over the past two weeks, there has been a marked uptick in sales velocity and volume for seafood distributors selling to foodservice. What does this mean? First, it seems like a lot of this is anticipatory buying. Restaurants and chains are eager to reopen, and with the prospect of restrictions being lifted in many areas, there is a sense of getting ready. Ordering again, building some stocks, are all aimed at what the new restaurant model might look like. But the foodservice industry is not the stock market. The stock market may have come back within spitting distance of its all-time highs, but this is not the case with businesses at large. Federal Reserve chairman Powell expects an historic contraction of GDP by around 30% in the 2nd quarter, with unemployment rising to depression era levels of 25%. Although there is likely to be some growth in the 3rd and 4th quarters, which would lead to optimism, the idea that we will snap back to where we started is gone. For the seafood industry and its foodservice customers this means we are likely to see a lot of stops and starts. The uptick in sales we are seeing this month may not last or may not have legs. That depends on how well our foodservice customers do. So far, the long term signs are awful. Mother’s Day was a huge success for the restaurants that were open with either takeout or dine in. Transaction data provider Womply says that sales were double on Mother’s Day from the average of daily sales since March. For many restaurants, it was their best revenue day since the crisis began in mid-March. But 1/3 of restaurants across the country were closed. And overall, Womply found consumers spent 72% less on Mother’s Day this year than last year. When you’re in a dark tunnel, even a match will provide some light. What is difficult for seafood distributors are the longer-term issues. About 25% of the independent restaurants in the U.S. are expected to close. Chains will do better, but the failure of so many independents will strengthen the power of the broadliners to service the remaining restaurants and those servicing chains, and hurt those, like many local seafood distributors, whose business model is servicing independents in their area. Indpendent restaurants are still hurting mightily. According to Open Table data, reservations and walkins are down 94% nationally than from where they were last year compared on a day by day. Even in the areas where restaurants are opening, such as Florida, Georgia, Texas and South Carolina, the average traffic in Open Table restaurants is down 81% from where it was a year ago, and it is only increasing very slowly. Georgia for example saw a 96% reduction as of May 1st, but as of yesterday, has only gone up to an 89% reduction. For chains the reopening will be slow and will not extend to all units. In many cases, the extra costs to open at low capacity means the restaurant cannot cover its overhead. One survey in New York showed that 61% of operators said they could not survive with less than 70% capacity. Only 25% said they could survive on 50% capacity. The reason capacity constraints are so difficult is that revenue is skewed towards weekends. Denny’s, for example, gets 36% of its weekly sales in the 36-hour period from Friday evening through lunchtime on Sunday. Capacity restraints eliminate the ability of the restaurant to survive on peak dining times Friday night and Saturday night. It is not a given that customers will come back to inside dining at the same levels as in the past. Other traditional sales venues like business travel, vacation, resort dining, and hotels, are likely to be depressed for years. This has meant that ‘ghost kitchens’ are one of the hottest restaurant concepts around. The idea is to take a brand and its signature dishes and put it in an industrial kitchen that does delivery only. Companies that specialize in setting up these kitchens can handle as many as 20 different concepts, so that the business can scale up dramatically. Each concept does its own social media marketing in a given locality, so the orders are coming in to the brand, but are filled at a central location. Such an operation can be stood up quite quickly in an industrial kitchen with proper training. It does not need elaborate build out of a design or branding concept, if it can work with established brands. Companies like Famous Dave’s Bar-b-que and Smokey Bones are both experimenting with this. Kitchen United is a company that is rolling out this business model. It has the potential to add revenue at a time when getting more revenue from dining in person is constrained. The point is that the uptick in sales in May is not pointing to a resurgence of traditional restaurant sales, but simply preparation for trying to figure out what lies ahead. For seafood distributors, trying to see how to add value to these future models, in a period of high unemployment and economic contraction, is what is on tap. To be lured into thinking that the sales uptick is the beginning of a return to normal is to let hope get in the way of what is in front of our eyes. https://www.seafoodnews.com/Story/1171540/The-Winding-GlassWith-Restaurants-Believe-What-You-See-Not-What-You-Hope-to-See
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