Australian Seafood Industry

http://seafood.tradeworlds.com/

Introduction

Overview of Industry Importance and Value

The Australian commercial fishing and seafood industry encompasses the wild catch sector, the aquaculture sector and the processing and retail seafood sectors (Austrade, online). The aquaculture and wild catch sectors are found on the country's vast land space which gives Australia the distinction of having the "world's third largest fishing zone covering 11 million square kilometres and extending 200 nautical miles out to sea" (Department of Foreign Affairs and Trade, online). It spans a number of climatic zones resulting in the increase in the aquatic environments that can be broadly divided into oceans, reef, inshore area and freshwater habitats. This is also probably why it has the distinction of being one of the most diverse marine faunas in the world because of its "geographical isolation from other continents and wide range of habitat types that include tropical to sub-Antarctic waters" (dfta, online). This diversity, coupled with the clean aquatic environment that the government has endeavoured to achieve, mean Australia is able to supply a vast collection of delicious seafood products worldwide.

Annual Sales Turnover of Seafood Industry in Australia

According to the Australian Seafood Industry Council (ASIC, online), total value of Australian seafood exports on average is around AUD$1.84 billion per annum. In the last financial year, it raked in AUD$2.2 billion in production. The seafood industry is the fourth most valuable food industry, after beef, wheat and milk (Austrade, online). Most recent figures from the Fisheries Research and Development Corporation show a potentially positive performance and outlook for the seafood industry.

Among the key commodities in the seafood industry are tuna, prawns, rock lobster, crab, abalone, scallops and oysters. Figure 1.1 shows the share of the fishery production across Australia.

Figure1.1

(Source: Seafood Industry Victoria, online)

Number of Seafood Retailers

The number of retailers in the seafood industrial business environment in Australia is calculated based on the restaurants, supermarkets / fishmongers and fish "n" chips the seafood is sold to. As of the 1999 period, there were a total of 34,867 seafood retailers operating in the industry, an increase by 16, 989 as compared to the total in 1991 (frdc, online)

Unique Selling Proposition

One of the Australian seafood producers selling proposition is that they are the only place in the world to provide Western Rock lobster, Northern Prawn and the Southern Bluefish which are some of the more highly demanded products in the market (Austrade, online). The emphasis is also to produce the industry's biggest money spinners, eg. High quality rock lobster, prawn, abalone and southern blue fin tuna (Australian Trade Commission, online)

Number of Competitors

The number of seafood suppliers in this report is based on the number of seafood producers that are found across Australia. From the findings made through Sea-Ex database (online), there are approximately 190 recorded seafood producers operating in the industry. The top three locations where the most number of producers can be found are listed below:

Top 3 seafood producing locations:

Western Australia Ð'- 30

Sydney Ð'- 24

Brisbane Ð'- 21

(Sea-Ex, online)

It is also noted that 30% of the total catch in the seafood industry is from the Western Australian waters, which explains the high number of competitors in WA.

Components of the Seafood Supply Chain

Current Practices

Product and Service Offerings

The supply chain in the commercial fishing and seafood industry includes the wild catch sector, the aquaculture and the processing, retailers, customers and human labour (Austrade, online). Fish and seafood products are distributed live, fresh or frozen as either whole or fillets, to the various retail sectors. The air and ocean freight carriers and the processing plant that produces canned, dried, salted and smoked seafood also make up part of the components of the seafood industry.

Transaction Costs

Transaction costs incurred throughout the supply chain process are considered a major component of the process. These costs are categorised into information cost, negotiating cost, and monitoring or enforcement cost (Hobbs, online). Information cost is the cost of searching for information about seafood and other crustaceans, its seasonal demands, the tide flow, best location for catchment areas and buyers demand fluctuations. Negotiation cost includes costs for negotiating for the best equipped fishing machineries plus any licensing issues. The monitoring costs apply to the cost of monitoring the quality and ensure that all specifications in the food production and terms are met.

Others costs that are incurred in the process are the costs of purchasing the supplies and raw materials, labour costs, machinery costs involved in the production, distribution costs, defects and defaults, the information system that is used in consolidating the whole process chain, and costs involved in marketing the products.

IT plays a major role in integrating the whole supply chain process together. The role of information technology (IT) in supply chain management is to assist managers in managing uncertainty and lead time through improved collection and sharing of information within supply chain processes. This is to ensure better, through better coordination, and improve asset management, and give the stakeholders involved the information necessary to optimize production and capital asset costs.

The Processes

The seafood supply chain encompasses production of fish by wild-catch or aquaculture, through processing, storing, transporting, marketing and/or selling, to the point at which the seafood is consumed. A step-by-step process is discussed in this section.

Reproduction and Harvesting - Aquaculture and Wild Catch Sector

For