Sector Trend Analysis – Fish and seafood trends in the United Kingdom

Production and consumption trends

In 2021, the OECD estimated that total aquaculture production in the UK reached 0.9 million tonnes in 2018, representing a 17% quantity increase over 2008. The value of aquaculture in the UK was US$ 2.7 billion in 2018, up 25% from 2008^{Footnote 1}. The UK seafood sector employed 15,201 people, and the UK fishing fleet had 6,046 powered vessels, most of which are small vessels, less than 12 m in length.

Fish and seafood expenditures in the UK were severely impacted by the pandemic, due to the closure of restaurants and other foodservice outbreaks. Recovery occurred through 2021 as foodservice resumed, but high inflation in 2022 has caused consumers to reduce their expenditure on fish and seafood^{Footnote 2}. Consumers are opting for poultry, eggs and pulses as cheaper sources of protein. Recovery for fish and seafood is forecasted to be slow, only recovering to pre-pandemic levels by 2025.

As a result of these pressures on the fish and seafood market, the British fish industry and their partners in government have launched a series of promotional campaigns, research initiatives, and infrastructure investments. Resources for these initiatives remain limited, however, and thus some campaigns have been discontinued due to shifting priorities^{Footnote 2}.

Retail market volume

The retail volume of fish and seafood grew from 2017 to 2022 in the United Kingdom at a CAGR of 1.2%. Consumption dipped in 2020, but recovered in 2021. Flat growth is forecasted through 2027, at 0.4% CAGR from 2022 to 2022. Crustaceans will be the fastest growing category through 2007, while growth in fish consumption will be minimal.

Trade overview and Canadian performance

The UK is a net importer of fish and fish products with US$ 4.9 billion of imports and US$ 2.2 billion of exports by value in 2022^{Footnote 3}.

The UK was the 11th largest fish and seafood import market in the world by value (2.6% market share), and the 13th largest by volume (2.1% market share) in 2022. The top three countries were the U.S., China and Japan, with a combined 37.9% market share by value in the same year. In 2022, Canada was the 13th largest import market by value (2.1% market share).

The United Kingdom was the 13th largest import market by volume in the world in 2022, representing a 2.1% market share. The import volume peaked in 2019, and has since fallen. Canada ranked 19th in the world, with a 1.5% market share. The top three countries for volume in 2022 were China, the United States and Japan. China has experienced rapid growth, with 24.1% CAGR, whereas Japan shrank from 2018 to 2022, with −6.8% CAGR.

In terms of value, the leading exporters to the UK in 2022 were Norway, Iceland and China. Canada was the 10th largest supplier, with $US 155 million of exports, representing 3.1% of total UK fish and seafood imports. Canada's import share cratered in 2020, but has since rebounded to pre-pandemic levels.

Canada's volume share of UK imports is much lower than its value share, at only 1.4% in 2022. This indicates that Canadian exports to the UK are driven by high-value products. By volume, the leading country is Iceland, with 18.6% of total UK import tonnage, followed by Norway and China. Icelandic exports to the UK have doubled from 2018 to 2022. Norway and China are the second and third most important import partners. Iceland and Norway are both notable for being non-EU nations that are located in the North Atlantic. It is therefore possible that the growth in their export volume reflects favourable trade conditions in the wake of Brexit.

The leading products imported into the UK in 2022 by value were fresh or chilled salmon, frozen fillets of cod, and prepared or preserved tuna, skipjack and bonito. Salmon grew 9.4% CAGR from 2018 to 2022. Tuna was previously the most important import product, but shrank (−5.1% CAGR) from 2018 to 2022. Canada had two products in the UK top 10 among its top 10 exports: frozen fillets of cod and prepared or preserved shrimp and prawns.

In 2022, Canada's main exports to the UK were salmon, shrimp and prawns, and lobsters. Other important exports included scallops and cod. Imports from Canada cratered in 2020, but have since recovered. As such, UK imports from Canada grew 2.6% CAGR from 2018 to 2022. Frozen lobsters were the fastest growing export product to the United Kingdom, with 47.6% CAGR from 2018 to 2022.

Canadian provinces' fish and seafood exports to the United Kingdom

Canada's provinces reported a total of US$152 million in 2022^{Footnote 4}. The leading provinces were British Columbia, Nova Scotia and Newfoundland and Labrador, which collectively accounted for 91.1% of Canadian exports in 2022. New Brunswick, Quebec and Prince Edward Island are the only three other provinces with significant exports to New Brunswick. Nova Scotia and New Brunswick were the two provinces whose exports were most affected by COVID-19, but they have since rebounded, and both posted positive CAGR from 2018 to 2022.

BC exported mainly salmon to the UK, accounting for 89.4% of its total fish and seafood exports to the UK in 2022. Smoked salmon has grown significantly, while other prepared and preserved salmon shrank from 2018 to 2022. Overall, British Columbian exports to the UK shrank (−3.3% CAGR) between 2018 and 2022.

Nova Scotia primarily exported lobsters to the UK, accounting for 76.9% of exports in 2022. Shrimp accounted for a further 22.2% of exports, with scallops making up most of the remainder. Frozen lobsters grew significantly from 2018 to 2022, while live lobsters fell slightly. Lobster exports were affected by the closure of foodservice outlets during the COVID-19 pandemic, but have recovered as these outlets reopened.

Shrimp are the leading Newfoundland and Labrador export to the UK, followed by cod. Shrimp and prawns accounted for 76.7% of Newfoundland and Labrador exports to the UK in 2022. Prepared and preserved shrimp grew by 14.9% CAGR from 2018 to 2022, while frozen shrimp increase slightly, by 0.9% CAGR. Newfoundland and Labrador's exports to the UK were less affected by the COVID-19 pandemic than other provinces.

Lobster forms the majority of New Brunswick's fish and seafood exports to the UK, at 93.1% of exports by value in 2022. As was the case with Nova Scotia, lobster exports fell significantly during the pandemic and have since recovered. As such, New Brunswick fish and seafood exports posted positive compound annual growth from 2018 to 2022.

Quebec's exports to the UK actually reached their peak during the COVID-19 pandemic, falling slightly since then. Frozen shrimp and prawns and frozen crabs were the two leading exports by value in 2022, representing 94.8% of exports by value.

Prince Edward Island's two exports to the United Kingdom were lobsters and tuna, with lobsters representing 88.4% of exports by value. Exports increased in 2019, 2020 and 2021, and have since fallen, such that CAGR from 2018 to 2022 was flat.

Opportunities

In order to mitigate the impacts of Brexit on bilateral trade between the two countries, Canada and the United Kingdom signed a Trade Continuity Agreement that entered into force on January 1st, 2021. The Canada-UK TCA is meant to replicate CETA and preserve preferential tariff rates. 94.4% of Canada's exports to the United Kingdom are duty free. Certain kinds of fish and seafood are not exempt, however, with Global Affairs Canada estimating an average tariff rate of 8.0%, which represents the Most Favoured Nation tariff^{Footnote 5}. CETA eliminated tariffs on a number of seafood products including live lobster, fresh mussels, fresh crabs, frozen shrimp, and frozen mackerel. Tariffs on seafood products such as frozen and processed lobster and mussels were set to be phased out by CETA, and so continuity of the CETA schedule implies that more opportunities will open for Canadian fish and seafood exporters to the UK in coming years.^{Footnote 6}

Canada and the United Kingdom launched free trade agreement negotiations on March 24th, 2022. Barriers to trade in fish and seafood are therefore likely to continue to be removed once this FTA is concluded, and Canada may be positioned to gain preferential access to UK markets relative to other UK trade partners.

Canada's broad (and growing) trade network provides Canadian companies preferred access to diverse markets all over the world. Information on Canada's free trade agreements (FTA) may be found at Global Affairs Canada, Trade and investment agreements.

The Canada-United Kingdom Trade Continuity Agreement (Canada-UK TCA) came into force on April 1, 2021, and provides continuity, predictability, and stability for trade between Canada and the United Kingdom (UK) (Trade Agreements; Canada-UK Trade Continuity Agreement). The Canada-UK Trade Continuity Agreement (Canada-UK TCA) replicates the main benefits of the Canada-EU Comprehensive Economic Trade Agreement (CETA) to ensure continuity in Canada's trade with the UK following the UK's departure from the EU (Canada-UK Trade Continuity Agreement explained).

The Canada-UK TCA provides Canadian exporters with continued preferential access to the UK market and includes the elimination of 98% of tariffs on Canadian exports to the UK (carried over from CETA) on entry into force, and the elimination of an additional 1% of tariffs on Canadian exports to the UK by January 1, 2024, when the TCA is fully implemented–which will bring the elimination of tariffs on Canadian exports to 99% (Canada-UK Trade Continuity Agreement explained).

For more information

The Canadian Trade Commissioner Service:

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Sector Trend Analysis – Fish and seafood trends in the United Kingdom
Global Analysis Report

Prepared by: Alexandre Holm Perrault, Market Analyst

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