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Finfish Focus: Tilapia

Improved quality and more value adding should help this popular species realize its market potential

Rick Ramseyer
November 01, 2005

Bill Beattie, the general manager of Shirttail Charlie’s restaurant in Fort Lauderdale, Fla., doesn’t have any trouble explaining the surging popularity of tilapia. It’s mild-flavored. It’s plentiful. It’s versatile. It’s inexpensive. Oh, and it’s hard to screw up.

“It holds together when you blacken it on the grill, it holds together in a pan when you sauté it — you can do most anything with it,” says Beattie, who estimates that the restaurant sells 22,000 pounds of tilapia per year. “It’s the perfect fish to use on a menu.”

Shirttail Charlie’s isn’t unique. Indeed, tilapia has found a place at the table at the nation’s largest casual-dining chains, including Applebee’s, T.G.I. Fridays, Olive Garden, Red Lobster and Ruby Tuesday, as well as at family-dining leader Denny’s.

And tilapia’s appeal extends far beyond restaurants, since consumers can easily cook the fish at home. Which explains why tilapia fillets are a given at supermarkets, club stores and specialty grocers nationwide, and why manufacturers are creating value-added tilapia products that are marinated, breaded or stuffed.

Tilapia (Tilapia spp.) has come a long way from its origin in Africa’s Nile River to its status as one of the world’s most-cultivated finfish. U.S. tilapia consumption, in live weight, stood at 412 million pounds last year and is projected to hit 504 million pounds in 2005. Tilapia now ranks as America’s sixth-most-popular seafood, with per-capita consumption at 0.7 pound.

Kevin Fitzsimmons, a professor at the University of Arizona in Tucson who has studied aquaculture for 25 years, says tilapia’s ascent is in step with producers’ emphasis on improving quality, pack- aging and presentation.

“In the last couple of years, there are better trims, deeper-skinned fillets — those kinds of things,” Fitzsimmons observes.

The bulk of tilapia is from overseas, with the vast majority of frozen fillets stemming from Asia. U.S. imports of frozen fillets from China, for example, approached 46 million pounds from January through July 2005, up from 33.7 million pounds for the same period last year, according to the National Marine Fisheries Service.

The lion’s share of fresh tilapia fillets, meanwhile, is farmed in Central and South America. Imports of fillets from Ecuador — the region’s top cultivator of U.S.-bound product — reached 14 million pounds for the first seven months of 2005, compared with 13.7 million pounds a year ago. (The two other leading fresh-fillet exporters are Honduras, followed by Costa Rica.)

All told, from January through July, U.S. imports of frozen and fresh tilapia — including whole fish — totaled 155.4 million pounds, up from 137.6 million pounds in 2004.

Twin Tails Seafood Corp. in Miami, which got into the tilapia business last year, is now bringing in multiple loads per month of frozen fillets from China. Providing fish primarily to foodservice distributors and seafood wholesalers, the company is focusing on vacuum-packed fillets marketed under the Boss brand.

“I don’t feel we’ve even begun to scratch the surface [of potential],” says Patrick McGill, executive VP of Twin Tails, citing consumers’ desire for a white, flaky fish that’s virtually boneless if it’s properly trimmed.

In late September, Twin Tails’ prices to wholesalers were $1.55 per pound for 3- to 5-ounce fillets, $1.95 for 5-to-7s and $2.15 for 7-to-9s.

“Prices have gone up a little bit — there’s been a firming of the market,” McGill says. “Right now they’re up about 10 cents to 15 cents a pound from what I was paying a year ago.”

Newport International in Tierra Verde, Fla. — slated to move to downtown St. Petersburg in December — also is using Chinese product.

“Our main category is crabmeat, but tilapia is very significant,” says Troy Turkin, executive VP of sales and marketing for Newport, which mostly supplies foodservice channels via distributors. The company’s prices in late September for frozen fillets were around $1.75 for 3-to-5s; $2.10 for 5-to-7s; and $2.15 to $2.20 for 7-to-9s.

“From a dollar standpoint, tilapia doesn’t compare with crabmeat, because it’s an [inexpensive] fish,” Turkin says. “But it’s definitely a huge growth vehicle for the industry and for us.”

Fresh-fillet providers also have seen sales rise. Mountain Stream Tilapia in Miami, an importer of fish cultivated in Honduras, El Salvador, Colombia and Belize, is “growing as fast as our farms can produce,” says Bob Tate, regional sales manager.

Mountain Stream sends its fresh fillets to foodservice distributors and to supermarket chains such as Price Chopper, Cub Foods and Stew Leonard’s, where tilapia is sold in full-service or self-service cases.

“Retailers prefer 5- to 7-ounce fillets, but with the rising demand, a lot of [producers] are going to market at 3-to-5,” says Tate, noting in late August that prices were $3.25 to $3.55 per pound, f.o.b. Miami.

Chain reaction
Tilapia’s attributes — not the least of which is a non-fishy taste — have spurred its move onto mainstream menus coast to coast.

“It’s such a mild fish that chefs can show off their culinary skills with sauces, seasonings and preparation techniques,” says University of Arizona’s Fitzsimmons.

“And tilapia works well as a substitution for almost any other kind of whitefish.”

Family-dining icon Denny’s, with about 1,600 locations nationwide, introduced China-sourced tilapia as a grilled-seafood selection ($7.79) in April 2005 and rolled out Lemon Pepper Grilled Tilapia ($7.99) this past summer.

“Both have done very well — they are among our top 10 dinner entrées,” says Denny’s spokesperson Debbie Atkins in Spartanburg, S.C.

Casual-dining chains have incorporated tilapia in their lineups, too. Applebee’s International in Overland Park, Kan., which franchises and operates more than 1,740 restaurants under the Applebee’s Neighborhood Grill & Bar banner, introduced Grilled Tilapia with Mango Salsa ($9.49) in May 2004.

And T.G.I. Friday’s, the flagship concept of Carlson Restaurants Worldwide in Carrollton, Texas, touts roasted Bruschetta Tilapia as a new item. Corporate siblings Red Lobster and Olive Garden, part of the Darden Restaurants fold in Orlando, Fla., menu tilapia as well.

Tilapia isn’t limited to the mega chains, of course. Among the choices at the 20-unit Rockfish Grill, with headquarters in Dallas, is the Cajun-themed Tilapia Pontchartrain ($11.12), plus chalkboard specials.

“It’s one of our bigger movers,” says Virginia Pivonka, purchasing manager, who sources 5- to 7-ounce IQF fillets from China.

Shirttail Charlie’s in Fort Lauderdale, uses blackened or broiled tilapia as a sandwich ($9.94) or a dinner entrée ($12.95). The restaurant receives weekly shipments of Costa Rican-farmed fillets — typically 3-to-5s — from a supplier in Florida.

“We pay between $2.90 and $3 per pound, and that’s been holding steady for years,” says Beattie.

Robust at retail
Tilapia’s popularity and versatility haven’t gone unnoticed by supermarkets and specialty grocers looking to offer customers convenient, cook-at-home options.

“Tilapia is pretty much all-purpose,” says David Friend, co-owner and seafood buyer for Weiland’s Gourmet Market in Columbus, Ohio, which sold 1,600 pounds of fresh fillets from January through September. “Bake, broil, fry, grill — you can do anything you want with it.”

Weiland’s, supplied by MidWest Seafood in nearby Dayton, features tilapia cultivated in Costa Rica. The 5- to 7-ounce fillets are displayed in the store’s full-service seafood case at $8.99 a pound.

“We buy a special trim,” Friend says. “It’s deeper skinned, and the belly [flap] is removed.”

Big-name grocers also are in the mix. In late September, Publix Super Markets in Lakeland, Fla., was selling fresh tilapia from Costa Rica and Ecuador for $4.99 per pound at its 865 locations in the Southeast. And Hy-Vee in West Des Moines, Iowa, with more than 200 stores in seven Midwestern states, had tilapia fillets going for $5.88 a pound as a weekly special.

Plenty of frozen tilapia is available as well, as both private label and
manufacturers’ brands. Newport International is developing a resealable 1-pound bag under its Jack’s Catch tag that will hold five or six fillets.

“I could see retailers possibly [pricing it] at $3.99, and they would be making good margins,” Turkin says.

And don’t forget warehouse stores like Sam’s Club and Costco. Sam’s, a division of Wal-Mart, lists 10-pound cases of “fresh-packed” tilapia fillets on its Web site for $42.26, plus shipping.

Moreover, tilapia is emerging as a value-added product for retail shoppers to take and bake. Icelandic USA in Newport News, Va., for instance, recently unveiled its Market Bay line of tilapia meals, available frozen or refrigerated in varieties such as teriyaki ginger and mild Cajun. The packages, priced around $5.99, each contain two 6-ounce fillets from Ecuador.

Outlook is bright
Tilapia demand may be strong, but with cultivation ratcheting up the world over, there are few concerns about supply.

“Farms in Southeast Asia and in Central and South America keep coming online, and existing farms continue to be more efficient,” says Fitzsimmons in Arizona.

“The rate of improvement we’ve seen — conversion rates, growth rates, survival rates, fillet-to-body-weight ratio — is just short of
spectacular.”

Fitzsimmons further highlights across-the-board hikes in quality — something that’s particularly important for tilapia, which absorbs flavor from the water it’s raised in and from feed.

At Newport International, “our partners in China have 1,000 or 1,500 acres of farmland [where] they either own or control the water and feed sources,” Turkin says.

“So we can have an impact on the water quality and what the feed is. For us, it’s basically corn and trims from our own fish-processing line.”

Also top of mind among some seafood players is sizing — namely, producers’ incentive to harvest fish sooner rather than later due to burgeoning markets.

Charles Yi, sales director of O Fine Foods in Arcadia, Calif., says tilapia has become “more price-driven right now” and notes that many farmers in China are thus focusing on smaller sizes, especially 3- to 5-ounce fillets.

McGill of Twin Tails makes the same observation but says the company’s two packers in China are providing enough larger portions.

“We haven’t had any problem getting the sizes nor the breakdown we need,” McGill says.

Longer term, industry representatives expect that higher costs for fuel, transportation and feed — coupled with the Chinese yuan’s strength versus the U.S. dollar — will prod tilapia prices up.

“The fuel surcharge right now is unbelievable,” says Turkin. “There are some [shipments] that we’re being charged 20 percent to 30 percent more than before.”

Still, stakeholders stress that tilapia prices are relatively low compared with those for other popular finfish species, and the outlook remains bright.

“As much as tilapia consumption has grown in the United States, we’re only talking 0.7 pounds per capita per year, which basically is one fish,” Fitzsimmons says.

“So there’s plenty of potential.”

November 2005 - SeaFood Business
 

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