The pandemic is driving Michigan seafood processors into a new retail-based environment

SState officials are preparing to distribute block federal grants to Michigan seafood processors who have transitioned from wholesale to retail during the COVID-19 pandemic.

Pandemic-related lockdowns in 2021 made transportation difficult and caused severe supply chain disruptions. As a result, processors turned away from the depleted wholesale market and into the retail trade to serve individual customers.

Lauren Jescovitch, Fisheries and Aquaculture Extension Educator for Michigan Sea Grantsays the pandemic has had an uneven effect on seafood processors overall, as some needed federal relief funding to ‘keep afloat’ compared to other ‘places having their best years ever’ the temperature”.

Specifically, however, most Michigan seafood processors primarily sold to wholesalers before the pandemic.

“It was much more of a wholesaler than a retailer,” Jescovitch said. “I would say it was around 80-20. Now I think it’s around 20-80.

Jescovitch describes seeing processors redo their storefront markets to accommodate larger retail volumes, with some installing drive-thru windows to serve customers while adhering to pandemic precautions.

The most common processed seafood products in Michigan include fillets and value-added products such as smoked fish and fish dips. The state defines seafood processors as any entity “responsible for any activity that alters the physical state of a fishery resource suitable for human consumption, retail sale, industrial use, or storage. long-term, including cooking, canning, smoking, salting, drying, shelling, filleting, freezing, or processing into flour or oil.

By the end of 2020, the state had issued 288 seafood processing licenses to 248 Michigan businesses, according to the state’s Department of Agriculture and Rural Development (MDARD). As of June 2022, 281 seafood processing licenses have been issued to 233 enterprises in the state.

The number of processor licenses is disproportionate to the number of producer licenses (51). Producers are fishers who catch or harvest large quantities of wild fish for commercial purposes. A report from the Michigan Sea Grant says the discrepancy in the number of licenses indicates the large volume of fish imported and handled in the state before arriving on our plates. According to another Michigan Sea Grant report, 90% of Michigan’s seafood was imported in 2017.

Meanwhile, the pandemic has led more Michigan seafood processors to source more locally.

Based in Grand Rapids Fishmongers of Michigan LLC opened in 2016, importing most products from South America and Asia and selling to restaurants and wholesalers. When COVID-19 caused significant disruptions in supply chains, the company turned to local and regional sourcing from Michigan and Canada.

Fishmongers of Michigan co-owner Louis Hamper said throughout the pandemic, the company was struggling to recruit staff and — with its main market closed — it was difficult to move product. While placing more emphasis on local and regional sourcing, the company has also leaned into the independent grocery market.

“It was a good thing for us to focus more on those networks,” Hamper said. “That’s pretty much how we weathered the storm. We pivoted very quickly and were very lucky.

Jescovitch said Michigan’s seafood processing industry is now “just a different world” than before the pandemic, and she hopes to continue to see more local sourcing led by consumer demand.

“I think people in Michigan should pay more attention to where their seafood comes from,” Jescovitch said. “If you’re going for a whitefish dinner, is that actually coming from the fishermen in Michigan or Canada? I think these are questions that consumers can start asking to help the industry.

Federal support

Reflecting these market changes, the state last month announced the opening of applications for the Seafood Processors Pandemic Response and Safety Block Grant program.

MDARD grants — funded by the U.S. Department of Agriculture — will cover the costs of workplace safety measures, facility upgrades, transportation, worker housing, medical and market pivots, such as those carried out by Fishmonger of Michigan. The grants cover costs incurred from January 27, 2020 to December 31, 2021.

“Michigan’s seafood processing industry is robust, and like so many food and agriculture sectors, our seafood processors have demonstrated their resilience and innovation during the pandemic,” said MDARD Director Gary McDowell in a recent grant announcement. “This grant offers an opportunity to provide much needed relief for unforeseen business costs incurred during the pandemic. Seafood processing remains an important part of Michigan agriculture and our state’s economy.

Jescovitch says the funds will particularly help processors who have taken extra precautions and delayed reopening even after lockdowns lifted.

“Those are the places that have a harder time coming back,” Jescovitch said. “Those who stayed open with extra precautions took a risk and got away with it.”

Meanwhile, labor shortages continue to be one of the main challenges facing commercial fish harvesters and processors.

While Fishmongers of Michigan has actually grown during the pandemic, the company’s biggest challenge is staffing.

“After going through that initial change, we continued to grow,” Hamper said. “We’re in a growth phase right now and it’s really hard to get people to work.”

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