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Species Focus: Blue crab

The demand for crabmeat heats up as producers rush to market with more value-added products

Crabmeat is used in a variety of products from salads
    and soups to traditional crab cakes. - Photo courtesy of Byrd International
By Rick Ramseyer
December 01, 2006

There's no shortage of seafood companies selling crab cakes these days, including the likes of Phillips Foods and Handy International. But the list is about to get longer: At least three major blue crab importers - Crab Associates, Byrd International and Twin Tails Seafood - are introducing new or forthcoming crab-cake products, potentially heating up demand for crabmeat this year and beyond.

Blue crab, long a regional offering from the Chesapeake to the Gulf of Mexico, has evolved into a national commodity in both foodservice and retail channels, spurred largely by the ready availability of low-cost imported crabmeat, especially the Portunus genus of swimming crab.

And though crabmeat is used in everything from salads to soups and sauces, the lion's share ends up in crab cakes, which in recent years have joined the lineup at casual-dining chains such as Applebee's, Ruby Tuesday and Bennigan's Grill & Tavern. They're also popular appetizers at seafood houses like McCormick & Schmick's and Bonefish Grill.

Crab Associates in Pinellas Park, Fla., with annual sales of around $30 million, recently began producing foodservice-destined crab cakes with a partner in Florida.

"We provide the crabmeat to them, and they formulate it and blend it," says David Fair, managing partner of the company, which annually imports about 2.5 million pounds of pasteurized crabmeat and another 1 million pounds of frozen crabmeat from Asia.

The new 3.5-ounce cakes, made with 75 percent crabmeat, are sold under the Pacific Cove brand. Up next for Crab Associates, which additionally provides colossal lump and backfin lump crabmeat to the Ruth's Chris Steak House chain, is supplying retail-ready frozen crab cakes to Fresh Market, a 60-unit specialty grocer in Greensboro, N.C., and Whole Foods Market, with 180-plus U.S. locations.

The crab cakes for Whole Foods of Austin, Texas - offered two or six to a package, as well as in a 30-piece appetizer pack - will be available in early 2007 and are made with organic vegetables and an approved list of spices and preservatives.

"We were one of the only companies that wasn't doing crab cakes, so we wanted to have something unique," Fair says.

Another player, Byrd International, which last year imported 2 million pounds of blue crab, is rolling out crab cakes as well.

"We never did a crab cake until [two months ago], and we sold our first run of it into a lot of foodservice places down here," says Kim Bishop, accounting and marketing manager for Byrd in Berlin, Md.

Marketed under the Chesapeake Tradition brand, the crab cakes come in 4-ounce and 3.25-ounce sizes, all made with 65 percent meat (mostly lump) and packed 12 to 
a box.

Twin Tails Seafood in Miami, an importer of blue crab from Venezuela and blue-swimming crab from Southeast Asia, is "investing in plants to produce certain value-added items - and the first ones will be crab cakes for foodservice customers," says Carlos Sarria, marketing manager, who was expecting the first shipment by year's end.

Twin Tails is also developing retail crab cakes for introduction in the first half of 2007, Sarria adds.

Handy International in Crisfield, Md., meanwhile, has been making crab cakes for 15 years as part of its value-added line.

"There's at least 20 crab cake producers out there now," says Terry Conway, chairman of Handy, which additionally handles domestic and imported softshell crabs and imported pasteurized crabmeat. "So it's a growth area of the market."

 

Fuel costs, weather take toll

Despite rising demand for blue crab, U.S. imports of the Portunus and Callinectes genus collectively dipped 5 percent during the first eight months of 2006, to 28.9 million pounds, compared with the same period a year ago, according to the National Marine Fisheries Service.

"Supply is not keeping up with demand right now," says Mark Sneed, president of Phillips Foods, which produces 14 million pounds annually, sourced from places like Indonesia, Vietnam, China and India.

"Fuel is a global issue, but it's particularly acute in Indonesia, where there were fuel subsidies before this year," Sneed explains. "We rely on small-boat fishermen who can't afford a lot of fuel; the result is they can't go out as far now, and they end up catching smaller crab, which is damaging to yields and impacts costs negatively."

Moreover, a slow start to the rainy season in Indonesia - the top producer of U.S.-bound pasteurized crabmeat - is slowing the harvest.

"We haven't seen conditions like this before in our time in Asia," Sneed says. "Not that it won't correct itself when the rains start, but it doesn't solve the issue of fuel or the [weak] U.S. dollar."

Through August, Indonesia sent a total of 9.6 million pounds of crabmeat to the United States, down from 10.2 million pounds for the same period in 2005. Other major suppliers are China, Vietnam and Thailand.

Regarding frozen product, China is the leading importer, with 1.5 million pounds of frozen crabmeat shipped through August, up from 1.4 million pounds for the same period in 2005.

Newport International in St. Petersburg, Fla., was the largest packer out of China last year. The company, which also sources from Thailand, Indonesia, Vietnam and the Philippines, has "developed a new process that allows us to produce the crab four to five days faster than is traditionally done in the industry in China," says Troy Turkin, executive VP of sales and marketing. "It's going to provide a much better quality product [that] is firmer, sweeter and has a better texture."

Byrd International is another significant importer, with plants in Thailand, China and Indonesia. Byrd also co-packs crabmeat in the Philippines, says Bishop, and was set to begin co-packing in Vietnam in late 2006.

Not everyone sources from Asia, of course. Ocean Technology in Arnold, Md., handles several million pounds of crabmeat a year - 90 percent of it pasteurized - with the majority stemming from Mexico and an increasing amount from South America.

"We're kind of in a niche market, because we're only producing crabs from the Callinectes genus," says Bob Stryker, president of Ocean Technology. The company sells an 8-ounce container at retail and a 16-ounce package for foodservice, both under the All Natural brand.

"Our demand has been tremendous," Stryker notes.

 

Prices steady

In late October, 16-ounce cans of pasteurized Asian crabmeat were priced in the $15.50 to $16 range for jumbo lump, $9.25 to $9.75 range for backfin and lump, $8.25 to $8.50 for backfin, $6.50 to $6.75 for special and $4.25 to $4.75 for claw, according to Urner Barry Publications in Toms River, N.J.

Pasteurized Venezuelan crabmeat was listed in the $14.50 to $14.75 range for jumbo lump, $6.50 to $7 for backfin and lump, $4.50 to $5 for backfin, $5 to $5.25 for special and $3.75 to $4 for claw.

The harvest of domestic blue crab ( Callinectes sapidus ) was hindered by inclement weather this season and was lackluster. In late October, No. 1 Jimmies fetched $65 to $75 a bushel, up from $30 to $35 in the summer, while No. 2s brought $30 to $40, up from summertime prices of $20 to $25.

Prices for softshell crabs remained high throughout the season. Whales and jumbos topped $50 a dozen in April, but slipped under $20 in the summer when the fishery peaked. By summer's end, whales climbed back to $40 to $45 a dozen, while jumbos were $25 to $35.

Domestic blues

The U.S. blue crab industry has taken its share of lumps in recent years, with the double-whammy of tightened fishing restrictions to protect stocks and the onslaught of blue-swimming-crab imports.

"It's been said that out of every 3 pounds of crabmeat in the United States, 2 pounds are imported," says Joe Cardwell, marketing specialist for the Virginia Marine Products Board in Newport News. He 
cites Callinectes crabmeat from Venezuela in particular for keeping domestic prices down and forcing East Coast processors and picking houses out of business.

"Venezuela has a year-round [operation]," Cardwell says, "and they flood the market."

Still, blue crab remains a significant economic driver along the 
East Coast.

Through June, Virginia watermen harvested more than 1.5 million pounds of blue crab - up slightly from a year ago - with the majority of crabmeat from that catch ending up in regional grocery chains such as Ukrops and Wegmans, says Cardwell.

In North Carolina, the 2005 blue crab haul approached 23.6 million pounds, with a dockside value of almost $15.4 million. The state's marketing efforts include "working with chefs throughout the state to develop and promote blue crab recipes," William Small, seafood marketing supervisor for the Department of Agriculture and Consumer Services in Raleigh, stated via e-mail.

The Capital Grille in Charlotte, for example, features the North Carolina Blue Crab & Avocado Salad with Ruby Grapefruit Vinaigrette, created by executive chef Tony Schwappach.

In Maryland, where blue crab landings last year were 32 million pounds valued at $38.1 million, domestic crabmeat is a staple at local grocery stores, as well as at seafood restaurants like Cantler's Riverside Inn in Annapolis; and Suicide Bridge and Harris Crab House, both on the Eastern Shore.

In recent years Maryland has used newspaper, radio and TV ads to remind consumers that the blue crab season is open until mid-December.

"With hard crabs, the demand is between Memorial Day and Labor Day, but the harvest peaks August through October," says Noreen Eberly, director of the seafood and aquaculture program for the state's Department of Agriculture in Annapolis. "That's always been a challenge to get people to think about eating crabs and crabmeat after Labor Day."

 

Retail, foodservice inroads

Refrigerated or frozen crabmeat (and, increasingly, crab cakes) have become commonplace at national supermarket chains that in-
clude Wal-Mart, Costco, Safeway, Albertson's, Giant, Stop & Shop, Food Lion, Hannaford, Ahold, Publix and Trader Joe's.

And seafood companies are still finding ways to tap that market. Earlier this year, Crab Associates introduced 8-ounce and 16-ounce clear-plastic cups of crabmeat at Whole Foods and Fresh Market. (And the price is steep, in the neighborhood of $34 per pound for jumbo lump, one of six varieties.)

"The average [consumer] is able to walk into the retailer and say, 'Wow, look at the big pieces of jumbo lump in this," Fair says.

Crab Associates is also preparing private-label crabmeat for H-E-B supermarkets in San Antonio that should be ready in time for Lent.

In the foodservice world, blue crab plays a serious role on many a menu. But few seafood players rival Phillips, where blue crab items represent more than 65 percent of the lineup at its eight full-service restaurants in Maryland, Washington, D.C., Myrtle Beach, S.C., and Atlantic City, N.J.

Phillips is getting further exposure via concession providers such as HMSHost Corp. in Bethesda, Md., which has license agreements to run Phillips outlets in airports in Baltimore, Charlotte, N.C., and Washington, D.C., with more sites slated for Norfolk, Va.; Islip, N.Y.; and Atlanta.

"We also sell Host quite a substantial amount of product that they put on menus around the country," Sneed says. "But it's still sold under the Phillips brand."

All told, despite challenges in the blue crab industry, both domestically and abroad, seafood representatives expect demand to continue to rise, especially for crabmeat.

"It's a commodity that's withstood the test of time - it's been around for 100 years," says Stryker of Ocean Technology. "And I don't see that changing anytime soon."

 

Contributing Editor Rick Ramseyer lives in Cumberland, Maine

 

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