Irish Seafood Processing Industry A Personal Perspective. Presented by Eddie Power 13 May 2015

Transcription

1 Irish Seafood Processing Industry A Personal Perspective Presented by Eddie Power 13 May 2015

2 Initial View Based on limited knowledge, the industry appears:- Very fragmented [170 companies] Small companies majority less than 1m Home market orientated in many cases State supports widely dispersed Low sustained profitability in most sectors Limited ambition for development 2

3 Initial View As a consequence, the sector is:- Not competitive on a European scale Not exploiting the catch in Irish waters Landing less than 25% of available catch Exporting over 80% of landings in commodity form 2014 Value added processing only 14% of landings Low in capital investment Significantly below EU average in value added 3

4 What Does That Mean? 1.2 million tonnes caught in Irish waters Max 0.25m landed in Ireland (20%) 0.05m tonnes processed in Ireland 0.2m exported with no added value Industry processing approx 5% of total catch in Irish waters Failing its participants and the Nation 4

5 Global Trends Trends evident in the last 20 years likely to continue and accelerate Globalisation (Bigger Companies) Critical Mass (Trawler and factories) Lower cost production Continued technological advances Companies of scale and niche players Change will continue as a major feature Why should Irish Seafood be any different? 5

6 Other Sectors What has happened in other sectors? This has also happened in Seafood in Europe 6

7 Lets look at some of our biggest competitors Norway - Marine Harvest 3 billion - Cermaq 610 million Scotland - Scottish Salmon Company 150 million - Whitelink Seafoods 58 million New Zealand - Sealord 350 million - Sandford 320 million Scale and critical mass works 7

8 900 Irish Seafood Sector Performance ' Year Domestic Exports Total market value 8

9 Irish Beef, Dairy & Seafood Exports million Beef Exports Dairy Exports Seafood Exports

10 Major Opportunity Most productive fishing grounds in EU Irelands green status [Origin Green] Irelands food island image Global consumption growing rapidly Extra 40 millions tonnes by 2030 Perceived healthy option Few opportunities as good [if any] 10

11 ADAPT DEVELOP PROGRESS If we don t respond we will not develop Survival is not compulsory No one will mourn our passing We cannot stand still Progress not possible without change Stop complaining about current quota regime Focus on exploiting existing opportunities 11

12 To Move Forward & Develop......the industry needs: Further significant consolidation or cooperation Critical mass and scale [to be competitive] An export oriented mindset [growth markets] A commitment to added value The capacity to invest in technology and innovation The scale to exploit by products 12

13 There are two possible ways to move forward 1. Voluntary Sectoral Clusters 2. Sectoral Champions Lets briefly explore a little further... 13

14 Voluntary Sectoral Clusters Likeminded companies come together and: Share a common vision Set up a Newco to implement the vision Newco facilitates scale in: Sales & marketing Purchasing and procurement Process asset utilisation NPD and innovation Brand development Elimination of duplication 14

15 Participation in Newco can be by Merging together to form Newco with proportionate shareholdings held by the participants Acquisition of business to create scale in a Newco Holding shares in Newco simply to achieve the central and synergies without change of ownership to the existing co. These Newcos should then seek partnerships or joint ventures with both Irish and International catching and processing interests that are compatible with the vision 15

16 Sectoral Champions In the absence of Voluntary Sectoral Clusters, State Agencies should enable Sectoral Champions. Such Sectoral Champions should have: A solid track record in the sector A strategy for the development of the sector A commitment to added value processing A plan to create more employment An appetite for consolidation and change 16

17 Existing State support and grants perpetuate the current status quo. Consequently, State Agencies should:- Develop a strategy for the different sectors of the industry This should become the Irish Seafood Development Strategy [ISDS] Existing supports should be reviewed A new set of supports designed to advance the ISDS should be developed No incentives should be provided for projects not compatible with the ISDS 17

18 What does good look like? Ireland as North Atlantic Seafood Hub 2 billion in total revenues by billion of exports 500,000 tonnes of fish processed Integrated catching to value added Critical mass and scale Investing in NPD and innovation 4 major Irish Seafood companies Turnover 150m - 200m each Supported strategically by the Irish Strategic Investment Fund This is achievable All that s required is the ambition and the will to do it 18

19 Additional revenue of 1.1 billion + 4,500 jobs directly 7,000 jobs indirectly Major development in coastline counties Revitalisation of fishing communities Wealth generation in peripheral counties Foundation for further growth THE PRIZE IS GREAT THE EFFORT IS NOW NEEDED 19

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