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Seafood Futures: Four Marketplaces of Tomorrow

Tom Collins, Seafood Insight Specialist

Seafood Futures Source.PNG

In light of the global food industry’s growing sustainability challenges, we must remember that 75% of the world’s diet comes from just 12 plants and five animal species (FAO, 2021). The careful management and conservation of our natural capital is crucial to the continued sustainability of the seafood sector. Whilst the future is mostly uncertain and unknown, what we do know is that seafood production will need to transition in light of this green agenda.

Bord Bia’s study, Seafood Futures: Four Marketplaces of Tomorrow has been designed to explore what viable strategic (including innovation) choices, tapping into valuable growth areas, would create a decade of sustainable growth for Irish seafood. The purpose of the study was to develop a tool that would provide the direction and highlight the clear, ‘where to play: how to win’ opportunity areas. In the creation of this tool, we have combined strategic growth models with the future scenarios and drivers of demand, to really understand what the ‘Marketplaces of Tomorrow' might look like. This insightful article will feature Four Marketplaces and their respective opportunity areas arising from the study. Irish suppliers can leverage these to better connect to the needs and demands of tomorrow’s consumers and work towards a sustainable and profitable future in the marketplaces of tomorrow.

From our understanding of the macro forces at play and the signals of change it becomes clear that there are two critical uncertainties that we must consider as the foundation for any future framework. 

The first is goal orientated, focusing on sustainability or gain. We must consider the tension point between an inherent need to provide protein for a growing population and the commercial impact of doing so, versus the necessity of safeguarding our oceans and ecosystems for the future of the plant and human existence. Every sustainability report speaks to the absolute necessity for the future of the oceans for the planet and for human sustenance, calling out to limit overfishing, ensuring that fisheries are given space to breathe so that the ocean can thrive as the world’s most important eco-system. Its alternate polarity is the need to provide smarter solutions in areas like health or convenience, often for the same cost, for a growing population in a way that generates profitable business growth.

The second critical uncertainty is delivery orientated, focusing on production and capacity. We must consider the balance of nature, science, tech and innovation in not only the delivery of supply but also the maximisation of yields for future sustenance. The demand for affordable protein will continue to increase as populations increase towards 2050. We will see increasing scale economies and efficiencies gains on one hand – driven by increasing automation and consolidation - and the tension around managing quotas on the other. Conversely the ocean economy has potential beyond extracting basic protein – we (have) and will see high value industries from wind energy, to pharma and wellness will seek to leverage the ocean’s yields. Areas like sea mining may be the next eco / sustainability battlefield.

The polarity of these uncertainties represent the extreme corners of the future. It is within this framework that we can define the more realistic manifestations that might exist, in the form of commercial marketplaces. We refer to these as the four ‘Marketplaces of Tomorrow’.

  1. Scale Biz is a marketplace of consolidation and collaboration, where economies of scale drive competitive advantage in the production of cheaper protein as an undifferentiated commodity. We must be mindful that just as there is today, there will still be a role for cheaper protein. For some consumers, they will want stable, secure, cheap protein and the niceties will be forgotten. To meet this, sustainable innovation will have unlocked the power of affordable aquaculture to become a significant provider of global protein.
  2. Smart Fish will feature a blended or hybrid approach of smart pricing and product differentiation. It will seek to create value through supply chain innovation and growth in new models and efficiency technologies. Whilst there will be great product at smart prices, the sustainable benefits will be hindered for most.
  3. Blue Ocean will leverage similar or adjacent resources to diversify into high value categories with greater protection of margins. Investment in new and emerging blue economies will bring about new opportunities beyond increasingly under pressure fishing. Innovation will play a significant role in finding new yields beyond traditional fishing and breakthrough IP will drive considerable value in knowledge based economies.
  4. Green Tales will see focused differentiation within the Sustainability marketplace. The demand for natural and sustainable seafood will have accelerated to a point of premiumisation and luxury. To command a higher price, sustainability will need to be owned throughout the value chain and delivered by marrying innovation and technological breakthrough.

To develop a strategic position and ensure long term relevance, we need to decide on which marketplace is the best fit for our capabilities and where we can meet demand with supply. Once identified we can start to explore the ways in to the marketplace and how we can position ourselves to generate the greatest sustainable value.

For each of our marketplaces we have proposed five opportunity areas which serve as thought starters for innovation with the aim of translating into commercial opportunities. Each area centres on a specific idea and outlines what’s involved to play there and the implications at an industry level but also a producer level. By way of inspiration, each area is brought to life with examples of products and brands that are currently tapping into the opportunity.

By leveraging these opportunity areas we can better connect to the needs and demands of tomorrow’s consumers and through investment in innovation and capability, we can work towards a sustainable and profitable future in the marketplaces of tomorrow.

The full report will be available next month and for any further information, please contact tom.collins@bordbia.ie

 

References

What is Agrobiodiversity?. (2021). Retrieved 13 July 2021, from http://www.fao.org/3/y5609e/y5609e02.htm