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« November 2006 Table of Contents

Tilapia

Popular farmed whitefish a serious contender on the U.S. top-10 seafood list

Tilapia first appeared on the list of America's most popular seafood species in 2001, when it ranked 10th. Now, after vaulting from ninth to sixth place two years ago, the widely cultivated fish is poised to take over the No. 5 spot from catfish. When that happens - the 2006 statistics won't be released until next fall - tilapia will be the only new species to join the top-five club since 1998, when catfish displaced cod.

Tilapia's meteoric rise won't come as a surprise to industry stakeholders. The warmwater fish, whose origin has been traced to Africa's Nile River, is a sales star, thanks to its neutral flavor, versatility, year-round availability and stable, relatively low price.

Those attributes, coupled with vastly improved efficiencies in nutrition, selective breeding and processing technologies, ultimately could propel tilapia to the top of the seafood-consumption chart, says Kevin Fitzsim­mons, an aquaculture expert and a professor at the University of Arizona in Tucson.

"In my experience, anyone who tries a high-quality tilapia product is hooked," Fitzsimmons stated via 
e-mail.

Indeed, tilapia ( Tilapia spp .) boasts a presence on menus throughout the United States, ranging from mom-and-pop restaurants to national chains like Applebee's, Ruby Tuesday, T.G.I. Friday's, Red Lobster, Olive Garden and Denny's. Tilapia also is a standard offering at many supermarkets, specialty grocers and club stores, as well as at online retail outlets.

U.S. annual per-capita tilapia consumption, based on 2005 data, stands at 1 pound, just behind catfish. But this year, Americans are on pace to eat more than 580 million pounds of tilapia, in live weight, up from around 504 million pounds in 2005 and 412 million pounds two years ago, and consumption "will certainly exceed that of catfish," Fitzsimmons wrote.

Stateside seafood companies have experienced that spike firsthand. Tila­pia sales are growing by double digits at Sea Port Products in Kirkland, Wash., which imports frozen tilapia, mostly from China.

"Tilapia is the fastest-growing item we handle," says William Dresser, Sea Port president. "There's nothing [else] that approaches it right now."

Foreign push

Though tilapia is raised in states like California, Texas, Arizona and Florida, annual U.S. production accounts for only about 20 million pounds. The vast majority comes from overseas.

For the first seven months of 2006, U.S. imports of frozen and fresh tilapia, including whole fish, surpassed 190 million pounds. That's up more than 35 million pounds from the 155-plus million pounds imported during the same period last year, according to the National Marine Fisheries Service.

Most of the frozen tilapia entering the U.S. market flows from Asia, with China by far the largest producer, followed by Taiwan and Indonesia. Imports of frozen Chinese fillets topped 74 million pounds from January through July, a huge jump from just over 46 million pounds for the same period in 2005.

The bulk of fresh fillets, meanwhile, stem from Central and South Ame­rica. Shipments from Ecuador - the region's leading cultivator of U.S.-destined product - exceeded 14 million pounds for the first seven months of 2006, up slightly from a year ago. Honduras and Costa Rica are also key fresh-fillet exporters.

Tilapia prices overall are relatively stable, ranging in late September from $3.10 to $3.55 per pound for fresh fillets from Central and South America, compared with around $1.55 to $2.10 per pound for frozen fillets from China, according to Urner Barry in Toms River, N.J.

But suppliers say larger sizes have been difficult to come by, as many growers choose to harvest the high-demand fish sooner rather than later.

China, for example, "has not been able to fill that [size] void yet, so you've seen the pressure on the large sizes," says Dresser of Sea Port. "So you would expect those sizes increasing in price, especially as we move toward the holidays and the beginning of the new year."

China rising

China already is the world's No. 1 producer of tilapia, and it's showing no sign of giving up the title. Tilapia production in China this year is projected at 2.4 billion pounds, up 10 percent over 2005, according to the U.S. Department of Agriculture's Foreign Agriculture Service. And exports - 70 percent of which are destined for the United States - were expected to climb 20 percent.

Grobest USA in Arcadia, Calif., the sales office for Asia-based Grobest Group, is among a lengthening list of companies that are helping spark China's production prowess. Grobest sources frozen tilapia - including blocks, whole fish and fillets - from China and Thailand for foodservice and retail customers in the United States, Canada and Mexico.

"Demand continues to be almost explosive," says Ron Patton, company president. "So Grobest is expanding its operations in China and Thailand to try to meet our piece of it."

Nonetheless, supplies for many importers have been hampered in recent months by concerns about some aquaculture facilities in China using malachite green. The topical fungicide has been banned for use on food in the United States and Canada since the early 1990s. Those concerns led to heightened inspections by Chinese authorities, resulting in shipment delays.

"It used to take approximately six weeks from order to get [product] to the United States," says John Victoria, CEO of Western Edge Seafood, which sources frozen tilapia from a partner on Hainan Island off China's southern coast. "Now it's taking from eight to 10 weeks."

As of late September, delays had eased for some companies.

"I'm able to book under normal-purchasing time periods again, but I still haven't caught up and probably won't until maybe November or so," says Dresser of Sea Port. "Most people are in this situation; some worse so."

Shipments have been further restricted by the requirement for tilapia farmers to register with the CIQ - the Chinese equivalent of the USDA - says Charles Yi, sales director for O Fine Foods in Arcadia, Calif., which provides frozen tilapia to the North American market. "There's a lot of farms that didn't register with CIQ, so they can't export product," Yi says.

O Fine Foods has seen tilapia sales drop, Yi adds, but will still handle 5.8 million pounds of tilapia this year.

Fresh approach

Frozen tilapia is only part of the story, of course. Growers in Central and South America, which primarily export fresh fillets, are strengthening production as well.

Still, lack of rain in Ecuador and a subsequent drop in production led to a shortage of fresh fillets last fall and into the Lenten season. That was among the reasons two suppliers of fresh tilapia fillets decided to join forces.

Enaca USA in Medley, Fla., and Mountain Stream Tilapia in Miami merged in April to form a new company: Aquamericas, which now holds about a 22 percent share of the fresh-fillet market.

"After Lent last year was kind of a tough period for all of us in the industry; we felt as a combined company that we could avoid those kinds of things in the future and gain efficiencies," says Jim Nunneley, managing director of Aquamericas in Miami.

The deal, a 50-50 partnership, allowed the companies to blend some operations, exemplified by Mountain Stream's move into Enaca's distribution facility. For now, Aquamericas will continue to use the Rio Mar and Moun­tain Stream brands, Nunneley says.

In recent months, the company's production has returned to normal in Ecuador and remains strong at its other farms in El Salvador, Honduras and Belize. Nunneley expects up to 20 percent growth in 2006, not including the additional production capability in Honduras that's coming on now, as well as a joint-venture operation set to open in 2007.

Tropical Aquaculture Products in Rutland, Vt., representing its owners in Ecuador, Colombia and Costa Rica, also is seeing ramped-up production. By year's end, Tropical Aquaculture expects to sell 450,000 pounds of tilapia per week, compared with 375,000 pounds weekly in late August.

"The growth curve continues to increase," says John Schramm, the company's president.

Coast to coast

Given tilapia's widespread acceptance, it's not hard to find the fish in foodservice and retail arenas across the country. Casual-dining goliath Apple­bee's International in Overland Park, Kan., with more than 1,880 restaurants worldwide, features tilapia on the Weight Watchers menu at participating Applebee's Neighborhood Grill & Bar restaurants. The grilled Cajun Lime Tilapia, topped with black-bean-and-corn salsa, goes for around $9.50.

At Olive Garden, which has more than 580 locations in the United States and Canada, Parmesan Crusted Tilapia ($14.25) has been on the menu since the summer of 2005.

"It's a mild, white fish that complemented our Parmesan crusting," a spokesperson for the Orlando, Fla., chain said at the time. "And it gave us an opportunity to expand our seafood [selections]."

It's not just the big chains that are tapping tilapia. At the Riverside Tavern in Knox­ville, Tenn., roasted Key West Tilapia - marinated in key lime and cilantro and served with white-cheddar mashed potatoes and steamed broccoli for $16.99 - is a new addition to the restaurant's fresh-catch menu.

In Chicago, the Bistrot Margot uses 15 pounds of fresh tilapia fillets each weekday and another 20 pounds per day on weekends. The signature Tila­pia Aux Noix ($14.95 for lunch and $17.95 for dinner) is roasted with a balsamic brown-butter sauce and served with asparagus, beets and walnuts.

"It's one of the biggest sellers in the restaurant," says Carlos Gaytan, Bis­trot Margot's chef de cuisine."

Moreover, tilapia continues to make inroads in retail settings, both in the seafood counter and in the frozen case.

Bloom, a fresh-focused supermarket concept with a dozen locations in the Carolinas and greater Washington, D.C., in late August was offering 5-ounce South American tilapia fillets for $2.29 apiece in two varieties: tortilla crusted and coconut crusted. "Tilapia sells well in all Bloom markets," says a spokesperson for Bloom's corporate parent, Food Lion, in Salisbury, N.C.

And at the Hannaford supermarket in Yarmouth, Maine - one of the chain's 150-plus stores in five states - fresh fillets from Ecuador last month were priced at $5.99 a pound.

On the frozen front, Gerrity's supermarkets, with nine locations in northeast Pennsylvania, was carrying 1-pound packages of frozen Seabest tilapia fillets for $2.99.

Newport International in St. Peters­burg, Fla., recently introduced a 1-pound, resealable retail pack of frozen tilapia under the Jack's Catch brand, priced anywhere from $2.99 to $3.99.

"We're marketing more heavily now for the supermarket trade," says Troy Turkin, the company's executive VP of sales and marketing.

Internet outlets offer plenty of tilapia choices, too, both frozen and fresh. In late September, Nebraska-based Omaha Steaks was selling four frozen, 6-ounce lemon-peppered tila­pia fillets for $19.99, touted as a $10 savings. And Amazon.com listed 2 pounds of fresh tilapia, shipped from Charleston Seafood in South Carolina, for $26.61.

For now, tilapia sales remain on a steep ascent, with no plateau in sight.

"We hear people say all the time that tilapia is the fish for people who don't like fish," says Patton of Grobest USA. "I don't expect it to level off yet."

Sea Port's Dresser concurs: "It's still extremely healthy from an infrastructure standpoint. Supply is able to meet growing demand. I'd say it will continue to grow exponentially and could even challenge shrimp for the No. 1 spot."

Contributing Editor Rick Ramseyer lives in Cumberland, Maine