Sustainable Seafood 101
There are three criteria for sustainable seafood: environmental protection, economic viability and social responsibility. This Sustainable Seafood 101 overview focuses on the environmental considerations that determine whether seafood is sustainable, and the common sustainability failure points along the seafood supply chain that highlight opportunities for innovation and implementation by entrepreneurs and investors.
- Seafood is a $150B USD global industry that is expected to surpass $200B by 2030
- The retail seafood sub-industry generated $15 billion in sales in 2019
- Given rising demand and unsustainable practices, global fish stocks are being depleted rapidly, with ~90% already fished at unsustainable levels
- Seafood companies are leveraging supply chain innovations and improvements in transparency, technology and traceability to increase the marketing and revenue premiums for their sustainable brands
Sustaining the Supply of Seafood to Meet Rising Demand
Seafood is the primary source of protein for more than 3 billion people on Earth and supports a 150 billion dollar global industry - of which retail seafood comprised $15 billion in 2019 - that harvests over 179 million tons of wild and farmed seafood each year. As the world’s population grows, the demand for seafood grows too, with the market expected to surpass 200 billion dollars by 2030. By 2040, global population is estimated to total nine billion people, and the demand for food is expected to increase by as much as 70 percent above current levels.
Yet as demand for seafood grows, overfishing, environmental degradation and other forms of marine mismanagement have decimated global supply. An estimated 90% of marine stocks are already being fished at unsustainable levels. If current trends continue, a report released jointly by the World Economic Forum and Ellen MacArthur Foundation estimates there could be more plastic in the ocean than fish (by weight) by 2050.
Rising demand for seafood and food supply overall signal ample opportunities for growth for new, commercial entrants and at-market investments that introduce sustainable methodologies and products along all points of the seafood supply chain. These opportunities exist across all seafood-related industries (e.g. fishing, aquaculture, shipping, sales, hospitality, finance, etc.) and can leverage improvements in transparency, technology and traceability to increase the marketing and revenue premiums for their sustainable edge over less sustainable competitors.
Market Overview: Retail Seafood
In 2019, the retail seafood category accounted for $15 billion in sales, with finfish accounting for approximately $7.4 billion, or half of all sales (60% of which were for just salmon and tuna), shellfish for $5.7 billion, or one third of sales, and “all other seafood” (including sushi, octopus, squid, caviar, complete meals, snacks, and more) accounting for the remaining $1.9 billion.
What is Sustainable Seafood?
There are three criteria for sustainable seafood: environmental protection, economic viability and social responsibility. This overview focuses on the environmental considerations that determine whether seafood is sustainable, and the common sustainability failure points along the sector’s supply chain that highlight opportunities for improvement and innovation for entrepreneurs and investors.
Environmentally sustainable seafood is wild, farmed or otherwise cultivated (via processes like cellular aquaculture) seafood that is grown and harvested in ways that don’t harm the environment or other wildlife.
Wild-Caught vs. Farm-Raised
Seafood is traditionally sourced in one of two ways: fishing in open water, commonly labeled in stores as “wild-caught”, or via aquaculture, the farming of fish and other seafood, typically labeled as “farm-raised”.
Wild-caught seafood is fished using a wide range of traditional methodologies. Each type - trawling, dredging, netting, and harpooning, to name just a few - has its own effects on the ocean. Wild-caught products are sustainable only when the populations are well-managed and not overfished, and when fishing gear and processes have minimal impacts on habitat and other wildlife. Innovations in fishing methodologies and tools account for a large proportion of blue economy startups and have the potential to dramatically reduce the industry’s negative impacts on the environment.
Aquaculture is sustainable when its operations limit habitat damage, disease, pollution, farmed fish escapes and the use of wild fish as feed for farmed fish. Specifically, blue economy companies seek to make the seafood industry more sustainable by innovating their technology and operations to avoid overfishing, limit bycatch, limit wild fish use in aquaculture, manage pollution and disease, preserve habitats, prevent farmed fish escapes, stop illegal fishing, promote science-based fisheries, management, and improve supply chain transparency and traceability.
Cellular Aquaculture: the Newest Frontier in Cell-Cultured Meat
Cellular Aquaculture, or cultivated seafood as it is sometimes called, is an emergent new process for sourcing seafood that promises to supplement fish farming and wild-capture fishing with real seafood products that are produced in a lab from fish and other marine animal cells.
Cultivated seafood processes and products have the potential to eliminate the negative environmental and health effects of traditional seafood sources, and startups working in this field have raised nearly $100 million dollars in just the past four years. Start-ups in this field, still largely focused on R&D, include companies like Blue Nalu, Wild Type and Finless Foods.
As with other types of cell-cultured/cultivated meat, cultivated seafood products must first be approved by national regulators before going to market, though seafood products may face fewer hurdles and accelerated review timelines (none of the aforementioned start-ups in this field have yet undergone review processes).
In the U.S., seafood products fall under the FDA’s jurisdiction for review, provided they do not contain land-based meat products. In the event that cultivated seafood products are augmented with terrestrial meat products (such as bovine serum) or genetically modified organisms (GMOs), they will also become subject to review by the USDA, which would extend the regulation process and timeline for approval. Leading companies in this space are largely aiming to avoid the incorporation of any terrestrial animal ingredients in their products to streamline their regulatory processes, something which makes it likely they could reach the market before cultivated terrestrial meat.
In many places, cultivated meat will be approved product by product. In Europe, cultivated meat will be regulated under an existing regulatory framework, although no company has yet submitted a product for approval. The government of Singapore formalized their regulatory process in 2020. The U.S., Israel, and Japan are also interested in cultivated meat and likely to present regulatory breakthroughs soon. India and Brazil are monitoring global progress with an eye to creating a path to market as well.
In addition to these traditional and pioneering sources for real seafood, there are two categories of alternative seafood that are drawing increasing investor attention.
Plant-based seafood, which uses plant-derived ingredients to replicate the flavor and texture of seafood, accounted for just 0.06% of total retail seafood sales in 2019. Common supermarket brands that produce plant-based seafood products include Gardein, while several newer start-ups, like Sophie’s Kitchen, New Wave Foods, Good Catch and more still have relatively limited distribution.
Though often conflated with broader plant-based seafood alternatives, some alternative seafood products use fermentation-product proteins rather than traditional plant-based proteins. Quorn, for example, sells a “fishless sticks” product built around mycoprotein, a signature ingredient it produces via fermentation. Increasingly, product research may produce hybrid products with one or more plant-based, fermentation-derived, and/or cultivated proteins.
Consumer Demand & Marketing Campaigns
Brand sustainability rating systems
Major brands and seafood vendors such as Whole Foods have gradually begun rolling out sustainable seafood rating systems that track key sustainability metrics and rank products accordingly. Some, like Whole Foods, have stopped carrying fish brands that do not meet baseline rating requirements.
Key Investors: New Crop Capital, Rage Capital, S2G Ventures, Tyson Foods
This primer was prepared by our Investable Oceans team with invaluable contributions from key leaders in the sector. Our team extends a special thanks to:
The entire team at Blue Nalu, Alex and Julie Wallace
Want to learn more about sustainable seafood?
Browse our collection of Quick Dips (short articles) and Deep Dives (longer articles) in the Investable Oceans Sustainable Seafood Zone.
New sustainable advances help reimagine fish farming: “It’s really the wave of the future” (CBS News, April 2021) https://www.cbsnews.com/news/fish-farming-reimagined/
Novel offshore fish farm edges closer to commercial reality (The Fish Site, April 2021) https://thefishsite.com/articles/novel-offshore-fish-farm-edges-closer-to-commercial-reality
‘Aquafeed 3.0’: creating a more resilient aquaculture industry with a circular bioeconomy framework (Reviews in Aquaculture, April 2021. https://onlinelibrary.wiley.com/doi/full/10.1111/raq.12567#.YJR2sIAu8sQ.linkedin
Ensuring the sustainable growth of the US offshore aquaculture sector (The Fish Site, March 2021) https://thefishsite.com/articles/ensuring-the-sustainable-growth-of-the-us-offshore-aquaculture-sector
“How do we build an aquaculture sector that is serious about SDGs 1 and 2?” (The Fish Site, March 2021) https://thefishsite.com/articles/how-do-we-build-an-aquaculture-sector-that-is-serious-about-sdgs-1-and-2?utm_source=COS+General+Mailing+List&utm_campaign=c67b159506-EMAIL_CAMPAIGN_2019_06_03_03_17_COPY_01&utm_medium=email&utm_term=0_dac1066b57-c67b159506-449799714
A 20-year retrospective review of global aquaculture (Nature, March 2021) https://www.nature.com/articles/s41586-021-03308-6
Illegal Fishing & Seafood Fraud
Atlantic Fishery Managers Have Big Opportunity to Improve Transparency and Prevent Illegal Fishing (The PEW Charitable Trusts, June 2021) https://www.pewtrusts.org/en/research-and-analysis/articles/2021/06/09/atlantic-fishery-managers-have-big-opportunity-to-improve-transparency-and-prevent-illegal-fishing
Information Sharing Is Key to Ending Illegal, Unreported, and Unregulated Fishing (The PEW Charitable Trusts, May 2021. https://www.pewtrusts.org/-/media/assets/2021/04/information-sharing-is-key-to-ending-illegal-unreported-and-unregulated-fishing.pdf
Oceana Finds Hundreds of Vessels Vanishing Along Argentina’s Waters. (OCEANA, June 2021) https://usa.oceana.org/publications/reports/oceana-finds-hundreds-vessels-vanishing-along-argentinas-waters
Revealed: seafood fraud happening on a vast global scale (The Guardian, March 2021) https://www.theguardian.com/environment/2021/mar/15/revealed-seafood-happening-on-a-vast-global-scale
The Outlaw Ocean: Business and Technology Solutions that Address Illegal Fishing and Labor Abuses in Seafood Supply Chains (Stanford Center for Ocean Solutions, Fall 2020) https://oceansolutions.stanford.edu/sites/g/files/sbiybj13371/f/outlawocean_fullreport_fall2020.pdf
Aqua Cultured Foods Debuts Microbial Fermentation Whole-Muscle Cut Seafood Alternative (Green Queen, June 2021) https://www-greenqueen-com-hk.cdn.ampproject.org/c/s/www.greenqueen.com.hk/amp/aqua-cultured-foods-debuts-microbial-fermentation-whole-muscle-seafood-alternative/
BlueNalu’s cell-cultured seafood offers fresh fish without the catch (Climate & Capital Media, June 2021) https://www.climateandcapitalmedia.com/bluenalus-cell-cultured-seafood-offers-fresh-fish-without-the-catch/
Fish Without the Catch: Seafood Alternatives Are on the Rise (Sentient Media, January 2021) https://sentientmedia.org/fish-without-the-catch-seafood-alternatives-are-on-the-rise/
Blue Nalu has compiled a through reading list with academic and mainstream coverage of cellular aquaculture here: https://www.bluenalu.com/resources
Seafood Business for Ocean Stewardship (SeaBOS, 2021) https://seabos.org/
How blockchain is protecting species and consumers from fish fraud(CNN, May 2021) https://www.cnn.com/videos/tv/2021/05/27/open-sc-australia-c2e-spc-intl.cnn
Experts Propose Enforcement and Reporting Improvements for Regional Fisheries Management Organizations (RAMS) (The PEW Charitable Trusts, April 2021) https://www.pewtrusts.org/en/research-and-analysis/white-papers/2021/04/experts-propose-enforcement-and-reporting-improvements-for-rfmos
Conservation Alliance for Seafood Solutions aims for bigger impact (SeafoodSource, April 2021) https://www.seafoodsource.com/news/environment-sustainability/conservation-alliance-for-seafood-solutions-aims-for-bigger-impact
Sea Change: Using Citizen Science to Inform Fisheries Management (BioScience, March 2021) https://academic.oup.com/bioscience/article/71/5/519/6162973#246821336
Electronic Monitoring Benefits Every Link in Seafood Supply Chain (PEW, Feb 2021) https://www.pewtrusts.org/en/research-and-analysis/fact-sheets/2021/02/electronic-monitoring-benefits-every-link-in-seafood-supply-chain
IPNLF releases new five-year strategic plan (SeafoodSource, August 2020) https://www.seafoodsource.com/news/environment-sustainability/ipnlf-releases-new-five-year-strategic-plan
The Role of Aquatic Foods in Sustainable Healthy Diets (UN Nutrition, May 2021) https://www.unnutrition.org/wp-content/uploads/FINAL-UN-Nutrition-Aquatic-foods-Paper_EN_.pdf
CREO Investment Report Release: Aquaculture Value Chain (CREO, April 2021) https://creosyndicate.org/news-collection/2021/4/22/creo-investment-report-release-aquaculture-value-chain
Accelerating Sustainable Seafood (UN Global Compact, February 2021 https://ungc-communications-assets.s3.amazonaws.com/docs/publications/Accelerating%20Sustainable%20Seafood.pdf
Sustainable Fishing, Higher Yields and the Global Food Supply (Marine Stewardship Council, January 2021) https://www.msc.org/docs/default-source/default-document-library/about-the-msc/msc-insights-january-2021.pdf
The Top 25: Seafood Sustainability & Conservation (SeafoodSource, September 2020) https://www.seafoodsource.com/news/environment-sustainability/the-top-25-seafood-sustainability-conservation
Netting Billions 2020: A Global Tuna Valuation (The PEW Charitable Trusts, 2020) https://www.pewtrusts.org/en/research-and-analysis/reports/2020/10/netting-billions-2020-a-global-tuna-valuation