Guest Column: Lobster sales in Asia soaring

First published in Landings, September, 2014

Colleen Coyne is seafood program coordinator at Food Export-Northeast, a non-profit organization composed of 10 Northeastern state agricultural promotion agencies, which administers federal, state and industry resources to help food companies increase sales overseas. In Maine, the organization works under the guidance of the Maine Department of Agriculture and in conjunction with the Maine International Trade Center.

Strong growth in Asian demand for American lobster continues in 2014. Maine’s lobster exporters are poised to reap more sales and greater market share this fall as Food Export-Northeast expands in-market lobster promotions and Maine companies again join Food Export-Northeast at fall trade shows in Hong Kong and Mainland China.

China became the leading foreign market consumer of U.S. lobster in 2013, purchasing more than $52.4 million worth, up $24 million (85%) from 2012. In 2013, growth in sales of U.S. lobster to China, Hong Kong, Korea and Taiwan outpaced sales to traditional big European markets. Combined, these four Asian markets accounted for 68% of foreign market lobster consumption and 87% of the $53 million in worldwide export sales growth. Speculation is that much of the growth in sales to Korea and Taiwan can be attributed to a spillover effect from the dramatic growth in Chinese consumer demand.

During the first six months of 2014 (latest data), total exports of U.S. lobster to world markets jumped 32%, compared to the same period in 2013, to reach $153 million. Increased purchases by China accounted for one-third of the total sales growth. China’s purchases of U.S. lobster swelled to nearly $30 million for the period (up nearly $13 million or 75%). Hong Kong, up 5%, Korea, up 63%, and Taiwan, up 54%, are also on track to make 2014 another record-breaking year for lobster purchases. Combined, these three markets accounted for $27 million in sales during the first six months of 2014.

Food Export-Northeast will again provide companies exhibiting at Seafood Expo Asia (September 2-4, in Hong Kong) and the China Fisheries & Seafood Expo (November 5-7, in Qingdao, China) with market briefings, trained interpreters, pre-arranged meetings with qualified buyers, and cost-share funding assistance to defray show and travel expenses. By late August, six Maine lobster companies were registered to exhibit at one or both events. Food Export-Northeast also continues to conduct importer and chef training seminars to create awareness and demand for American lobster. Restaurant and retail promotions are coordinated to help importers pull lobster into the consumer market. Product education, business introductions and promotion support are integral to introducing new products to foreign markets. Focused efforts conducted by Food Export-Northeast to promote American lobster to China’s major cities over the past four years has helped to make it a familiar item on many restaurant menus and at many retail counters.

To deepen market penetration and to expand sales opportunities for U.S. lobster suppliers, Food Export-Northeast’s current promotion efforts are focusing on China’s second tier cities. Consumers in these cities have acquired strong purchasing power and a taste for imported wild seafood products. Food Export-Northeast, as lead coordinator of a multi-year USA seafood promotion activity in China, is partnered with the Alaska Seafood Marketing Institute, the Southern U.S. Trade Association and the Western U.S. Agricultural Trade Association to conduct unified seafood promotions. Seminars and promotions featuring American lobster were conducted in China’s five largest cities during 2013 (Beijing, Shanghai, Guangzhou, Chengdu and Shenyang). In 2014, seminars and promotions are being conducted in up-and-coming cities (Heilongjiang, Dalian, Fuzhou, and Chongqing).

E-commerce is now an important food promotion avenue in China. E-commerce promotions provide nationwide product exposure and sales opportunities. Food Export-Northeast is coordinating lobster promotions with Alibaba’s retail site, Tmall, for this fall. Tmall is similar to Amazon in the U.S. Tmall’s “Single’s Day” (China’s version of Black Friday) produced sales in excess of US$5 billion during a single 24-hour period in 2013. Food products ordered online, including live seafood, can be delivered to consumers within hours after purchase. With consumer demand building, China’s appetite for lobster shows no signs of slowing and Maine’s lobster industry should continue to make strong gains in sales as market penetration expands.