Adding value in a mature seafood market: the French canned sardine industry

Faced with increasing competition from lower cost producers, French sardine canners have responded by developing niche markets and by focusing on convenience and quality as means to increase value.

Canned sardine production in France has been stable in recent years at around 10 000 MT per annum. The industry has consolidated significantly over the past 50 years or so with the number of factories dropping from 250 in 1950 to just 8 in 2003. This concentration has also coincided with increased imports of competitively priced product particularly from Morocco and Portugal. For some time canned sardine imports have been on an upward trend with 2002 volumes at 13 000 MT.

With strong price competition on the standard lines of sardines in oil or tomato sauce, French producers have attempted to develop niche markets for a range of higher value products based on convenience and quality. On the convenience side, canned sardine fillets are now widely available on French retail shelves and may be perceived as an improvement on the basic head off sardine product. Sardine fillets are generally sold in 95-100 gram net cans with either olive oil or tomato sauce. Fillets are also available in larger, 700 gram, catering cans. Production is on an upward trend. In 1998 French output was at 1 400 MT reaching 2 500 MT in 2002. The share of canned fillets in total French canned sardine output increased from 14% to 25% over this period.

French sardine canners have also sought to create niche markets by developing a quality image for what is regarded as a standard seafood product. Efforts have been made to differentiate an artisanal production approach from larger scale mechanical production. Sardines "a` l'ancienne", Label Rouge certification and the "Millésime" label represent various efforts in this direction.

'Sardines "a` l'ancienne" ' is now a regulated description subject to guidelines formulated by the French standards agency, AFNOR. The sardines must be headed and gutted by hand, fried in oil (as distinct from the usual steaming process), hand laid in the can and stocked (matured) for several months after canning. The cans are generally sold with a distinctive design to highlight the "artisinal" aspect of the product. The number one French sardine canner, Chancerelle, is also a leader in the production of sardines "a l'ancienne".

The French 'Label Rouge' quality certification takes the production "a` l'ancienne" a step further by insisting on stricter processing guidelines and by including regulations on raw material quality. On the raw material side, the sardines must be handled on board according to specific criteria, landed 12 hours after catch, delivered to the factory within 4 hours of landing and processed within 24 hours of factory arrival. Minimum fat content is 8%.

On the processing side, Label Rouge norms cover all stages of production including the use of sunflower oil for frying and the layering of fish on grills after frying. Extra virgin oil is used for the final product and the storage period is 4 months. Regarding presentation, the backs of the sardines should be visible on opening, and the fish should be homogeneous in size and aspect (around 4-7 to the can). The name of the boat and the fishing date should also be indicated on the can.

Label Rouge certification, which is perhaps the most widely known quality system in the French food market, is based on strict quality norms and complete traceability. Conformity to the norms is assessed by an independent agency. The French canner, Gendreau, was the first company, in 2001, to obtain the Label Rouge certification for canned sardines.

The "Millésime" description (based on the 'vintage' notion in the wine industry) is a variation on the "a` l'ancienne" process in that it involves the production of a limited volume of canned sardines (a l'ancienne) based on landings for a specific period, generally May to June, when fat content should be ideal. The sardines are packed in iron, as against the usual aluminium, containers and cans are illustrated in a "limited edition" series. To stimulate consumer interest, recommended consumption dates may also be indicated. For Chancerelle's 2001 millésime, the recommended year for consumption is 2007.

A final variation on the 'a` l'ancienne' theme concerns the introduction in 2002 of acanned sardine using a butter based recipe which allows the sardines to be fried after opening. The product offers consumers the possibility to heat the sardines for main mealuse instead of for the usual starter preparation. The new product was launched on the French market by Gonidec, a family owned canner based in Brittany. Retail price is reported to be 25% above the standard olive oil product.

In addition to the above efforts to upgrade the standardcanned product, at least one French canner has followed the tuna trend in introducing an alternative long life packaging format. Sardine fillets in pouch containers were introduced on the French market in 2002. To date, the product has been limited to the catering sector in which Saupiquet/Furic are selling a 697 gram net pouch product in lemon/vegetable oil. The high level of marketing expenditure currently being made by tuna pouch producers suggests a promising future for this type of presentation.

Efforts by French processors to add value in the canned sardine sector represent creative solutions to dynamize what is essentially a mature, low cost market. Niche markets created by French sardine canners, particularly in the fillet segment, appear to be increasing although price continues to dominate the core canned sardine market. Pressure from Moroccan and Portuguese canners looks set to continue during 2003. Boosted by a 5% decline in unit values, French canned sardine imports are up 11% for the first 8 months of this year. While canned sardine exporters to France are unlikely to compete in the traditional "a` l'ancienne" niche markets, it may be just a question of time before they become more active in the fillet and pouch segments.

Gerry O'Sullivan
© 2003 FAO