Organic Shrimp, Value-Added Ceviche Tuna, Tilapia and More from Ecuador
From-the-Field Report By JOHN M. SAULNIER, QFFI Chief Editor & Publisher

Farm-Raised Organic White Shrimp under Expalsa’s Organic Wonder label is certified as organic by Naturland. This 454g bag contains 61 to 70 shrimp, which is enough for about four servings.

Farmers raising shrimp and fish in productive South Pacific coastal ponds along the equator can harvest almost three times a year, guaranteeing steady supplies to buyers worldwide.

While not exactly enjoying a bonanza due to relatively low margins realized for Pacific whites in the marketplace, Ecuadorian processors of frozen shrimp celebrated a banner year in 2006 just the same. Exports generated $597.6 million, while volume weighed in at over 264.3 million pounds. That stacked up against $480.2 million and 212.5 million pounds in 2005.

Seven years after devastating White Spot Syndrome threatened to wipe out the very foundations of the Western Hemisphere’s premier powerhouse of shrimp aquaculture, production has robustly rebounded from a lowly 37.7 million pounds to lofty levels never before charted.

But the white gold, otherwise known as Peneaus vannamei, has lost a bit of its luster along the way, as value during record-setting 1998 was $875 million.

Supply and demand economics since then has resulted in bargain- priced product for consumers, as worldwide output of farm-raised shrimp continue reach higher levels. Global volume, which reportedly hit 2.3 million metric tons last year, is poised to top 2.5 million tons in 2007.

Farmers in Ecuador have successfully turned things around by going back to the fundamentals of sustainable cultivation under strict quality control parameters. Today 180 hatcheries and 150,000 hectares of shrimp farms are again roubustly operating from Esmeraldas Province bordering Colombia in the north to El Oro’s boundary with Peru in the south.

“Subsequent outbreaks of white spot disease have been prevented by naturally improving shrimp larvae selection and avoiding the use of uncontrolled wild larvae sourced from the sea,” said Mercedes Plaza, retail sales manager for Guayaquil-based Promarisco Empacadora. “Now, if only a higher return could be earned for our efforts. Hopefully we are at or near the low point for shrimp prices.”

The shrimp aquaculture industry, which has been in business for almost 40 years in Ecuador and provides jobs for approximately 250,000 people directly and indirectly, is again healthy if not as wealthy as it was for some major players during the boom times of the 1990s.

Humberto Trujillo points out that Expalsa’s shrimp plant was the first in Ecuador to be BRC-certified – three years ago.

Among companies all the wiser for having experienced and survived the White Spot crisis is Guayaquil-headquartered Expalsa Exportadora de Alimentos SA, which today employs more than 2,000 people and ranks as the South American nation’s leading exporter of shrimp products.

When the highly infectious disease hit in 1999, most producers responded by trying to treat the symptoms with chemicals, antibiotics, fungicides, pesticides and ozone. But not Expalsa, which shunned medicinal remedies and instead took a holistic approach to recuperation by reducing pond stocking densities to natural habitat levels. For several years production plodded along at approximately 20% of normal rates. Today output from Expalsa’s 40,000 hectares of coastal shrimp farms is again nearing full capacity.

“Actually, without knowing it we transitioned into becoming an organic aquaculture producer after harvesting several chemical-free crops,” said Humberto Trujillo, export manager. “As a result, today we are the only integrated shrimp producer in the world that is 100% organic-certified – from our feed manufacturing plant, which turns out 70,000 tons a year, to our hatchery and grow-out ponds. More than 2,000 hectares, mostly along the north coast, have been certified for organic cropping by Naturland of Germany.”

As the company is engaged in every aspect of shrimp aquaculture, it guarantees buyers total traceability all the way back to the initial broodstock and nauplii stages.

Quality control is the job of all workers at Expalsa’s shrimp processing factory. The 20,000-square-meter plant features several production lines that are outfitted with state-of-the-art equipment as well as highly skilled employees.

Expalsa’s shrimp reproduction center has capacity to produce 250 million larvae from approximately 10.8 billion eggs laid by broodstock annually. No genetic manipulation or artificial insemination techniques are employed in the process.

“We don’t manipulate genetics, but rather select breeders that are captively raised under a closed production cycle,” pointed out Beatrice Vietl Bujard, who works in Expalsa’s organic support and advisory department. “Some 10.8 billion eggs are produced in our laboratory per annum, from which approximately 2.4 billion shrimp larvae are created.”

In fact, the company provides eggs to most of the shrimp hatcheries in Ecuador. It is also the main supplier of soy- and wheat-based organic feed, claiming a 40% domestic market share as well as a customer base in the USA and Central America. In addition, it produces conventional fish meal made primarily from tuna, which is exported throughout Latin America, Asia and the Middle East.

Low density stocking with no more than 10 postlarvae per square meter limits biomass, which is essential for organic shrimp raising.

“We exert tight controls over quality every step of the way,” said Ms. Bujard. “Water, which is pumped in only from estuaries that lead to the ocean, is monitored regularly. No artificial aeration is permitted, as this would require diesel or electric power and unnecessarily stir up the environment.”

Expalsa’s value-added products in both organic and conventional ranges run the gamut from semi-IQF skewers to breaded and popcorn shrimp, cooked rings, EZ-peel, shell-on and head-on shrimp.

Most of the company’s sales of head-on shrimp are rung up in Italy and within Chinese communities around the world. Large volumes were shipped in advance of recent Lunar New Year celebrations, as East Asian consumers both at home and abroad prepared to welcome the Year of the Pig with plenty of seafood products at banquet tables from Beijing to Brussels.

“The ultimate value-added shrimp product is organic or bio, as the Europeans say,” stated Trujillo. “We expect that segment to grow – especially in the EU, where a loyal following among distributors in Germany, Switzerland and other countries has already been developed.”

A farmer throws a net into one of the numerous semi-intensive Peneaus vannamei ponds in Ecuador, which typically measure from three to 20 hectares in size. Stocking density of post-larvae generally ranges from 8,000 to 150,000 per hectare, with yields averaging from 800 to 2,500 pounds per hectare.

One way Expalsa gives back to the community in Ecuador is by financing a shelter that provides housing, meals and education for 80 underprivileged children. The program is run in cooperation with a Catholic Church foundation.

In addition to the Naturland-certified Organic Wonder brand peeled and deveined cooked shrimp, numerous products are packed for private label clients. Among them is Ökofrost GmbH of Berlin, a German wholesaler specializing in the distribution of frozen organic foods sold under the Biopolar brand.

The raising of wholesome, nutritious shrimp in naturally balanced, ecologically-sustainable conditions is a business that Expalsa is proud to have helped pioneer in Ecuador. The sustainable, extensive farming process employed carefully guards against environmental degradation. Furthermore, its practitioners are fully committed to habitat protection and mangrove conservation. Over the years, the company has seen to the reforestation of 1,560 hectares of mangroves at its sites.

In addition to giving back to nature, the maintenance of human health and assumption of certain social responsibilities is something else to which Expalsa is committed. The company provides free medical care and schooling to farm and factory personnel, as well as to their children. Beyond this, room, board and education are given to 80 economically-disadvantaged youngsters aged 11-15. In coordination with a Catholic priest, a shelter was built near Guayaquil in which formerly homeless youths live, eat and are taught skills ranging from carpentry and metal working to machinery mechanics and computer programming.

“This project started some years ago, when it was decided to take money previously used to buy Christmas gifts for clients and suppliers and to instead use it to build a school,” recalled Carlos Rosales Pino, vice president. “The second year we constructed a church, and the third year a shelter was built to provide refuge for street kids. We are currently dedicating one cent earned on every pound of shrimp exported to this worthy cause. This pleases our customers as much as it pleases us.”

EU Market Beckons

Promarisco’s product development manager, R. Jara, stands before retail boxes of value-added frozen shrimp offerings packed by the company.

Luis Mario Rojas, seafood coordinator of the Corporation for the Promotion of Exports and Investments (CORPEI), told Quick Frozen Foods International (QFFI) that Ecuador’s Peneaus vannamei farming sector continues to benefit from ongoing funding of shrimp genetics research and the favorable weather conditions that allow year-around production.

“Twelve companies accounted for 80% of the record volume exported last year,” he said, “with most output coming from two provinces – Guayas and El Oro.”

“Buyers in the USA took 49% of the exports during 2006, which was down from 55% the year before,” Rojas continued. “Spain ranks as the No. 1 market in Europe, followed by Italy, France and the UK. Ecuador’s exporters have been focusing more on the EU since Washington imposed anti-dumping duties a few years ago.”

Promarisco Adds Value

Promarisco Empacadora, another major producer of shrimp products in Ecuador, operates a state-of-the-art processing plant next door to Expalsa’s factory. Employing some 2,000 people, the company is part of a vertically integrated group engaged in shrimp farming at 5,500-plus hectares of ponds. It operates a hatchery capable of producing 40 million larvae per annum.

“We also grow tilapia, which gives us something else to offer customers,” said Mercedes Plaza, retail sales manager. “Shrimp is a major activity, generating approximately $62 million in sales during 2005, with exports primarily going to the EU, the US and Japan.”

Promarisco’s frozen shrimp offerings include cooked, peeled and deveined, heads-on, heads-off, easy-peel, skewered and breaded products. Production amounted to 2.7 million pounds last year, compared to 7.6 million pounds of tilapia.

“Exports to Europe and the USA are about the same, even though we are unfairly forced to pay an anti-dumping duty of 3.58% on shipments to the United States,” said the retail sales manager.

Value-added products are increasingly moving to the forefront of Promarisco’s portfolio. Among them are a range of newly introduced ceviche treats, which feature shrimp marinated in lemon juice, tomato sauce and onions.

The dish, which is popular in Ecuador as well as other Latin American countries, is believed to have originated along the north coast of Peru during the Nineteenth Century. According to the online encyclopedia, Wikipedia, “One theory suggests that it got its name from the Quechua word siwichi.

Another suggests the name is derived from the Arabic term sibesh (acidic aromatic food), due to the participation of Moorish women who came to Peru during the viceroyalty. Hence the popular name Tapadas Limeñas.”

“In addition to an Ecuadorian recipe version, which is distributed in 250-gram retail packs, we have created a Mexican-style ceviche that is made with a spicier salsa,” said R. Jara, product development manager.

Q Stands for Quirola and Quality

Block-frozen and IQF shrimp products are weighed and packed at the Quirola plant in Ecuador. More than 4,500 pounds can be processed hourly, with Peneaus vannamei raw material sourced from farms in Guayas and El Oro.

Grupo Quirola, another supplier of Pacific white shrimp, is also focusing on enhancing its value-added line. “This segment will be more and more important for us in the future, as there is little profit to be earned in the commodity market nowadays,” stated Fernando Cevallos, manager of the Estar C.A. factory in Guayaquil that packs Quirola brand products.

The company, which employs 1,500 people in its integrated farm and factory network, gets raw material from 100,000 hectares of shrimp farms in El Oro and Guayas – about 100 kilometers from the processing plant.

“Vannamei are typically harvested at night and processed the next day to assure top quality,” said Cevallos. “We are presently capable of handling about 55,000 pounds during a 12-hour day. This will rise by 50% after the expansion of our plant is completed.”

The increased capacity is needed to meet growing demand, which increased by 18% last year. “We exported 25 containers in the month of December alone,” beamed the factory manager.

Like most of Ecuador’s shrimp exporters, Quirola is concentrating more of its sales efforts in Europe. France, Italy, Spain and the Netherlands are important markets, along with the United States.

Seafood Bounty from Bilbosa

Jorge Luis Verduga (left), general manager of Bilbosa, with the assistance of Laura Del Pino Caicedo of CORPEI (Ecuador’s Corporation for the Promotion of Exports and Investments), show part of the range of value-added seafood items made by the Manta-Montecristi-based company.

Situated about two hours northwest of Guayaquil via automobile is Manta-Montecristi-based Bilbosa Empacadora Bilbo S.A. Founded in 1993, the seafood company packs a wide assortment of frozen items ranging from raw and pre-cooked tuna steaks and loins to marlin loins and fillets, mahi mahi, squid rings and other forms of calamari, to value-added shrimp of numerous sizes and presentations.

“We started out exclusively in the frozen shrimp business, but after white spot disease struck other ways were found to survive and thrive by diversifying into finfish and calamari products,” said Jorge Luis Verduga, general manager.

With a processing plant operating close to the Port of Manta, Bilbosa has quick access to landings from the national tuna fishing fleet, which ranks as one of the most productive in the Pacific. Almost 300 industrial fishing vessels ply the rich waters off Ecuador, where the Humboldt cold stream converges with the El Niño warm stream to provide ideal habitat for yellowfin, skipjack and big eye tuna, as well as mahi mahi, snapper, grouper, swordfish, marlin, sea bass, flounder and round sardine.

“In addition to sourcing from deep-sea fishermen who freeze their catch on board, we are also supplied by near-shore artisan fishing boats which bring in fish daily,” explained Verduga.

Bilbosa’s factory is equipped with seven freezing tunnels able to rapidly bring finished products down to temperatures ranging from -35° to -50° C. Capacity is 60 tons of finished product per day, with blast freezer throughput capable of handling nine tons every 18 hours.

“Much of our tuna steaks and loins go to wholesalers and distributors in the United States, with significant volumes also shipped to Spain, France, Italy and Germany. Pre-cooked loins are typically exported in 20-pound bags to Spain, where repacking takes place,” noted the general manager.

Mahi mahi has been a hot seller of late, with twelve 20-foot containers loaded with 45,000 pounds shipped between February and April. “We are sourcing most of the mahi locally, with some supplies coming from nearby Peruvian waters,” said Verduga.

On the shellfish front, value-adding is ever in the spotlight. From Shrimp Tempura and Gambas con Gabardina (Coated Shrimp) to Shrimp Brochettes on bamboo sticks, Bilbosa offers these and much more. Skewered Giant Shrimp & Calamari, the latest item in the catalog, has been well received by Italian customers.

Asiservy Boosts EU Sales

Carlos Núñez is general manager of Asiservy, a family-operated tuna processing company based in Manta.

Manta-based Asiservy S.A., another tuna specialist, rang up $20.566 million in sales of 6.706 million kilos of frozen fish exports during the first nine months of last year.

The family-run company, founded by Gustavo Núñez in 1995, was initially established to supply fresh mahi mahi, swordfish and whitefish to the United States market. Two years later its focus shifted to frozen tuna loins, shipped mainly to EU buyers in Spain, Italy, Holland, France, Portugal and Greece.

“Our tuna products are subject to duties in the US, while the European market is duty-free,” commented Carlos Núñez, general manager. “That is why exports to the EU are steadily rising while sales in the US have remained fairly stagnant for the last five or six years.”

Juan Francisco Núñez heads up operations at the Asiservy plant, which is able to produce 100 tons of frozen tuna per day, plus an additional 15 tons of canned product. Prices received recently for loins were in the $3.20 range, while a 48-pack case of cans fetched $29.

“While there is plenty of competition from suppliers in Thailand, the Philippines, Indonesia, Vietnam and ACP countries, the advantage of being in Manta is that we are near an extraordinarily productive fishing zone, and have a highly efficient infrastructure,” pointed out Carlos Núñez.

In the future, the general manager expects to produce more value-added items such as exact-weight and custom-cut tuna portions, chunks, slices and perhaps even pre-packaged branded and private label products for European retail chains.

“As the cost for applying finishing touches to raw materials becomes more expensive to do in developed countries, buyers should turn to us to provide completely finished frozen tuna products. Our factory labor costs are perhaps 20% of what they are in the EU,” concluded Núñez.

The Tilapia Express

Priscilla Salem (right), production manager of Industria Pesquera Santa Priscila, oversees the sorting of premium-trim tilapia fillets that will be transported by air to Tropical Aquaculture Products in the USA.

All tilapia processed by Industria Santa Priscila is hand-filleted at this Guayaquil plant. Raw materials, which are trucked to the facility live, are sourced from 800 hectares of ponds operated by the company.

Don’t think for a minute that 27-year-old Priscilla Salem is too young to run a tilapia processing plant with the cool confidence of a seasoned professional. As the daughter of the founder of Guayaquil-headquartered Industria Pesquera Santa Priscila S.A., she grew up in the marine products industry and thus has logged many years of practical experience on the job. Furthermore, the hands-on factory manager has studied food science in Spain.

“My father built shrimp farms for other companies for many years, before going into the tilapia farming business prior to the outbreak of the white spot disease that crippled shrimp production in Ecuador,” she told Quick Frozen Foods International. “Today our company is the main Ecuadorian supplier of fresh tilapia to the United States. We are also a producer of frozen fillets, though volumes are relatively small. It is hard to compete with the Chinese producers in this sector.”

Mrs. Salem oversees a tight operation, with the help of a foreman who sets the pace according to the flow of raw material. When QFFI visited the premises he was gearing up the work force as live fish were being transferred from just-arriving mobile tankers into the factory for processing.

Though the facility is equipped with grading equipment and other automated, gleaming stainless steel machinery, it is immediately apparent that the greatest efficiency comes from the fleet-fingered line workers who skillfully wield razor-sharp knives to gut and cut the fish into fillets.

Tilapia, with its mild flavor and firm texture, has dramatically risen in popularity among both professional chefs and home kitchen cooks in North America. US consumers annually eat 0.85 pounds of the low-fat, high-protein fish per capita, according to the National Fisheries Institute. The ranking is No. 6 on the Top 10 list, with tilapia nipping at the tail of catfish’s 1.03 pounds mark.

Producers in Ecuador reportedly shipped 23.9 million pounds of chilled tilapia fillets to the United States in 2006, well ahead of the 15.9 million pounds sent from Honduras.

Meanwhile, frozen fillet volume exported to the USA from China rose 43% last year, reaching 139.5 million pounds. Frozen tilapia has typically been offered at about $1 a pound less than chilled product during the past few years, selling in the low $2 range for 7- to 9-ounce fillets, compared to a low $3 range for the same weight of chilled boneless, skinless fillets from South America.

Santa Priscila is a diversified company, exporting 2,700 tons of tilapia and other fish in 2006, in addition to 3,600 tons of frozen shrimp (processed at a separate plant) and 5,600 tons of mangoes.

“Our shrimp production has doubled in recent years, but prices received have remained low.

Unfortunately, the profit margin for tilapia is not much either,” said Mrs. Salem.

Industria Santa Priscila’s tilapia is farm-raised in chemical- and antibiotic-free environments at company-managed low-density ponds that occupy 800 hectares of space. This compares with approximately 8,000 hectares dedicated to shrimp aquaculture. Most fresh fillet production – which can be as much as 30,000 pounds per day – is shipped to Tropical Aquaculture Products, Inc., of Rutland, Vermont, which exclusively distributes the product in the United States.

“We deliver fresh fillets in 2- to 3-ounce, 3-5s, 4-6s, 5-7s, 5-8s and greater weights, in premium- or quality-trim as well skin-on or partial skin-on forms,” said the factory manager. She added that it typically takes nine to 10 months for tilapia to grow to a size that will yield a 600- to 700-gram fillet.
Once the fillets are packed in ice-filled, insulated styrofoam boxes, they are rushed to the airport for express shipment to the USA and elsewhere. Not that the tilapia fly first-class aboard Lan Chile and American Airlines, but the price of transport currently exceeds the cost of production and processing. Shelf life of the fish is up to 10 days. However, the distributor works hard to assure that sales occur within five to seven days.

“Demand for tilapia is growing, and we are prepared to supply larger orders. Our factory will soon be modernized with new equipment to assure that the pace of high-quality production will not be interrupted,” concluded Mrs. Salem.