U.S. Seafood Prices Spike Amid Inflation and Labor Shortage – A New Concern for RestaurantsAntonia Stroe
The inflation-driven seafood price spike is a growing concern in our industry, affecting operations across the entire chain—from suppliers to retail and restaurants.
A devastating storm is swiping across the U.S. seafood industry. Rising demand and low availability for many seafood products have caused prices to double for some specialty varieties. What does this mean by wholesalers and restaurants, and should we brace for worse?
Why are Seafood Prices on the Rise?
Rising inflation, labor shortages, and the pandemic-burned international trade have all shaken up the seafood supply in the U.S. And the results, predictably, were terrible. Some sources quote a baffling 17% rise in seafood prices over the past 12 months!
Looking at the broader picture, seafood is merely the latest category to fall victim to the inflationary surge that has been rocking the U.S. market. We’ve already witnessed gas, lumber, chicken wings, and even computer chips taking big hits in the new shortage economy. As of late, the food industry has also seen a record rise in wholesale prices compared to the previous year, and seafood products seem to be riding the same wave. Varieties like crab, halibut, scallops, and salmon have seen staringly high price increases in particular.
However, supply-level shortages are not the only ones to blame for the soaring cost of seafood ingredients. For one, the entire foodservice industry continues to struggle with labor shortages. Fishermen are more and more of a rarity, as many left the business when restaurant demand dropped significantly during the COVID lockdown. Suppliers still have a hard time finding truck drivers. Ports are also overwhelmed due to a lack of workers.
What’s more, the U.S. has seen substantially less activity in international trade due to COVID restrictions. This has been disastrous, as most seafood supply in the U.S. relies on imports. According to Restaurant Businesses Online, “supply lines from South America and Asia are broken due to the pandemic,” and the more expensive local alternatives cannot make up for the entire loss.
Many Restaurants Pull Seafood Dishes from their Menus
Once again, this is bad news for restaurants, tormented by cost increases and shortages of all kinds of items. To pass part of the weight of rising costs on to their customers, businesses featuring fish-based menus have no choice but to raise their prices.
Naturally, diners aren’t on board with this. As a result, some restaurant owners are completely pulling out many dishes from their menus: “the price we had to charge to be profitable was almost insulting,” Josue Pena, chef at Iberian Pig, told Bloomberg.
The soaring prices in the seafood industry, excessively high demand, and limited availability of seafood products continue to rock industry prices. But are they going to dip anytime soon? Luckily, It’s predicted that the current, overwhelmingly high demand will simmer down within a month—when the start of a new school year should halt increased pressure from tourism.
Even so, wholesalers and restaurants should still expect a residual price increase due to inflation and broken domestic supply lines, which continue to struggle with significant shortages.