Prepared Fresh or Frozen Fish and Seafoods

SIC 2092

Industry report:

This category covers establishments that prepare seafood, including shrimp cakes, crab cakes, fishcakes, chowders, and stews in raw or cooked frozen form. Prepared fresh fish are eviscerated or processed by removal of heads, fins, and scales. This industry also includes establishments primarily engaged in the shucking and packing of fresh oysters in unsealed containers.

Industry Snapshot

In the late 2000s, according to industry data, there were an estimated 580 establishments that prepared seafood, including shrimp cakes, crab cakes, fishcakes, chowders, and stews in raw or cooked frozen form. States with the highest concentration were Washington, Alaska, California, Florida, Louisiana, and Massachusetts.

Fresh or frozen packaged fish accounted for 38.9 percent in market share, followed by fresh prepared seafoods with 16.3 percent of industry share. Frozen prepared seafoods held 8.7 percent in market share while fresh prepared fish captured 16.3 percent of the market. Other significant categories were fresh crab meat packaged in non-sealed containers with 5.1 percent in market share and fresh prepared shrimp manufacturers with 4.6 percent.

Growing consumer knowledge about the potentially harmful effects of pollution and the consequences of improper handling and storage compounded the perennial worries about the quality of fish and seafood, both of which swiftly lose their taste and freshness. In the late 1990s, the National Fisheries Institute (NFI) commissioned a study that found that less than 30 percent of the younger generation between the ages of 35 and 50 called themselves moderate seafood users. In an effort to boost per capita consumption, the NFI turned its attention to seafood marketing. The institute launched an "Eat Seafood Twice a Week for Better Health" campaign, similar to the catchy "5-a-day" program used by the produce industry. The industry latched on to the low-carbohydrate diet trend of the early 2000s, and became more creative in the products offered. Whereas fish products previously were buried in breading or drowned in soups and stews, they are accented with herbs and marinated in sauces with gourmet appeal. The result was a steady and convincing gain in sales through the mid- and late 2000s. Moreover, based on positive health news regarding the benefits of eating more seafood, the industry has been able to increase prices on its products while sustaining the demand.

Organization and Structure

In general, small-scale processing plants are tied to local fleets that are in turn tied to specific stocks of fish that in many cases fluctuate dramatically, discouraging processors from expanding operations, developing new products, or adopting new technology. Those fleets not equipped for processing at sea must return to land at short intervals, rather than when full, so their harvest can be processed while the fish are still fresh. In addition to an expansion of at-sea processing operations and a greater use of fish and shellfish raised by aquacultural means, vertical integration is perceived to be the key to a profitable restructuring of the U.S. fish and seafood processing industry. Some industry observers feel restructuring is necessary to bring about large-scale, sustained investment in underutilized species, greater speed to market, and the ability to respond to shortages and gluts.

In an effort to boost consumption, a better program of inspection was regarded as a necessity for the future of the industry. While there was no mandatory inspection of fish and seafood by the federal government prior to the 1990s, processors, retailers, and wholesalers could pay for a U.S. Department of Commerce inspection. Approximately 10 percent of processors participated in such voluntary inspection programs in 1992. However, even in this restricted form, there was no uniformity since three different seals were available, designating different levels of inspection. Regulations at the state level differed from region to region but in general gave little protection to consumers.

By the mid-1990s, the rising incidence of seafood poisoning, estimated at 20,000 to 60,000 cases per year, prompted the Food and Drug Administration (FDA) to apply the Hazard Analysis and Critical Control Points (HACCP) program to the seafood industry.

HACCP is a scientific and systematic method used to monitor the microbiological, chemical, and physical safety of prepared foods that was followed on a voluntary basis by other food industries beginning in 1959. Under the plan, seafood distributors must identify critical points at which their product's quality is endangered and install safeguards. Although the regulations do not apply to fishing vessels or transporters, the processors are responsible for ensuring that the product reaches them in the purest form. For example, distributors are expected to only accept fish from government-approved waters.

Compliance with the HACCP program is expensive for the industry with a cost of $70 to $160 million to institute and $40 to $80 million per year to maintain thereafter. However, the FDA says the cost is offset by the reduced incidence of food poisoning, the nutritional benefits of more people eating seafood, and increased export income.

Background and Development

Soon after World War II, U.S. consumers began to rely increasingly on the convenience of fully or partially prepared fish and seafood, often available in frozen form. These fish products were available with or without coatings of breading; batter coatings were introduced in the 1960s. Batter-fried fish and seafood reached the consumer only after an extensive preparation in which the product was dusted with flour, dredged in batter, and lightly fried to fix the batter and achieve specified standards of texture and quality.

Fish and seafood constituted about half the frozen battered and breaded products consumed in the United States, the largest consumer of breaded fish and seafood in the world. The most frequently consumed types of coated seafood were precooked and raw portions of fish, followed by shrimp, fish cakes, and scallops. Among the breaded products most typically sold in frozen form were scallops, oysters, clam strips, clam cakes, and squid rings (calamari).

Freezing technology permitted great advances in an industry dependent on a product subject to rapid spoilage. However, not all species of fish and seafood respond well to freezing, and often delicacies of texture and flavor are lost. For instance, whereas crabmeat generally does not freeze well and has a briefer shelf life than many other types of fish and seafood, king crab lends itself to freezing. Well-suited to shrimp, catfish, and halibut, the technique of rapid freezing is especially effective because it minimizes loss of texture and flavor by guaranteeing uniformity of freezing. The "I.Q.F." marking, which refers to individually quick-frozen products, became a selling point for the U.S. consumer.

The United States was the world leader for a long period in terms of versatility in processing, handling, distributing, and marketing frozen fish and seafood. It was also an early leader in deploying techniques for freezing catches aboard ships, but lost its edge in the commercial application of this technology, which allowed fishing vessels to remain at sea for greater periods of time. Ships could remain at sea until their load was full instead of frequently returning to shore to ensure the freshness of their catch.

After peaking in the 1980s at 16.2 pounds per person, per capita seafood consumption rates declined in the 1990s. Along with health concerns regarding fish quality and levels of pollution present in waterways and, therefore, fish, this downturn was also related to negative images of the fishing industry, which came under attack from recreational fishers and environmental groups who charged that certain waters were being over-fished. The Gulf Coast Conservation Association was successful in pushing through legislation in Texas, Florida, Alabama, and Louisiana to prevent commercial fishers from destroying wetlands and endangering certain fish species. According to a 1998 report by the National Academy of Sciences, over-exploitation caused a 30 percent decline of fish stocks worldwide, from orange roughy and shark to swordfish and tuna. The report also said that an additional 44 percent are nearing over-exploitation. It was further noted that in U.S. waters, 80 percent of commercial fish stocks, from Atlantic halibut to red snapper to Pacific ocean perch, were disappearing.

Compared to a rate of 15.2 pounds in the mid-1990s, per capita seafood consumption stood at 16.5 pounds in 2006, up 0.3 pounds from 2005. Fresh and frozen fish accounted for more than 12.3 pounds of this total, an increase of 0.7 pounds from 2005. According to Packaged Facts retail frozen seafood sales rose 3.2 percent from 2004 to $1.6 billion in 2005 sales.

In 2006, the National Marine Fisheries Service (NMFS) indicated that the value of edible processed fresh and frozen fishery products was $6.7 billion. This represented a drop from the U.S. Census report that the value of shipments in the fresh and frozen seafood processing industry was $7.57 billion in 2002, which grew from $6.86 billion in 1999. This represented nearly 1.65 percent of the overall food manufacturing industry. For the larger seafood product preparation and packaging industry (including both the seafood canning and fresh and frozen seafood processing industries) shipments were valued at more than $10.1 billion in 2005, which represented an increase of 10 percent from 2004 ($9.21 billion). The number of establishments involved in processing decreased to 581 in 2005 from 606 establishments in 2002 while the number of employees in the industry dropped to 33,423 workers in 2005 from 36,158 workers in 2002.

A 2004 study conducted by Harris Interactive indicated that 51 percent of Americans who had ever eaten seafood said they were eating more seafood than they did five years earlier. Also Seafood Business reported that nearly 48 percent of U.S. households purchased frozen prepared seafood during 2005.

Creative seafood products continued to debut and buoy industry sales. In Kenai, Alaska, Fred West, president of Sea Products, marketed his salmon sausage and Wild Dogs (hot dogs made of wild Alaskan salmon). By the mid-2000s, his products were sold in 128 stores from Washington to Ohio. Sea Star, maker of Beacon Light seafood products, also introduced Bourbon-style Marinated Atlantic Salmon and Lemon Dill Salmon Burger products in 2005. Sojo Foods introduced frozen seafood cakes with two-ounce trendy sauces, including Thai Tuna with Chili Peanut Sauce, Caribbean Shrimp with Jamaican Pepper Sauce, or Fiesta Cod with Mexican Chipotle Sauce.

In 2007, American Pride Seafoods joined with Disney in a marketing effort geared toward increasing children's consumption. Characters such as Mickey Mouse, the Little Mermaid, Peter Pan, and Lilo and Stitch adorned various types of breaded fish products.

Current Conditions

According to the National Oceanic and Atmospheric Administration NOAA Fisheries Report, per capita consumption of fish and shellfish fell slightly to 15.8 pounds in 2009, 0.2 pounds less than the reported 16.0 pounds for 2008. Of the 15.8 pounds consumed, 11.8 pounds were fresh and frozen fish products. As the third largest country for fish and shellfish consumption, along with China and Japan, the U.S. consumed 4.83 billion pounds of seafood in 2009. Since 2007, Americans have consumed 4.1 pounds of shrimp annually.

In 2009, Seafood Business reported sales of private-label seafood entrees jumped 28 percent to $21.3 million; frozen fish sales increased 21 percent to $306.8 million; and other frozen seafood, such as breaded seafood items (besides fish and shrimp), along with unbreaded crab, climbed 15 percent to $44.6 million.

Controversy surrounded the frozen fish industry following the removal of more than 21,000 packages of seafood from either store shelves or distribution facilities in 17 states. The National Conference on Weights and Measures alleged in the March 2010 Chicago Tribune that "the ice was wrongly included as part of the labeled weight of seafood....In some instances, the investigation found, ice accounted for up to 40 percent of the product's weight."

New processing and packaging technologies that extend the shelf life of fresh and prepared fish and seafood are important to growth in the processing industry. Other challenges facing this industry include developing seafood products that can be microwaved without any loss of crispness and improving the overall quality of such products. Another focus will be creating new products to catch new customers. This includes upscale, gourmet-type frozen seafood products with a focus on healthy foods that are also safe and reliable.

Industry Leaders

Major companies in this industry included Gorton's Seafood with 2008 sales of $740million; Pinnacle Foods with brands Van de Kamp's and Mrs. Paul's and 2008 sales of $1.5 billion across all product categories; and Admiralty Island Fisheries, Inc., which does business as Aqua Star, with sales of $34 million. However, private labels held the largest segment of the market with 39 percent.


According to the U.S. Department of Labor, only slight change in employment in the U.S. fish and seafood processing industry was expected through 2014, although a shift in the distribution of the work performed is expected, along with an increase of semiskilled workers for processing plants and a decrease in skilled workers for markets and other retail centers.

The skills most important to processors include good eye-hand coordination, manual dexterity, depth perception, and color discrimination. These skills are usually acquired in apprenticeship programs or on the job rather than in any formal educational settings. Work environments often require extended periods of standing for employees, as well as low temperatures necessary to keep product fresh.

Aside from promotion to a supervisory position, employment in processing of fish and seafood offers few career prospects. In this area, as in other areas of the fishing industry, wages are typically low, although there are some variances in salary scales based on geographic location. According to a May 2006 U.S. Department of Labor's Bureau of Labor Statistics report, the seafood product preparation and packaging industry employed 36,800 workers, with the largest segment working in production.

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