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As oil spill lingers in Gulf of Mexico, seafood prices could begin to rise

Frank Chivas, owner of Salt Rock Grill and other bay area restaurants, has stocked up on 50,000 pounds of shrimp. He fears the price of local seafood is about soar because of the large oil spill in the gulf.

STEPHEN J. CODDINGTON | Times

Frank Chivas, owner of Salt Rock Grill and other bay area restaurants, has stocked up on 50,000 pounds of shrimp. He fears the price of local seafood is about soar because of the large oil spill in the gulf.

Restaurateurs and retailers are poised for seafood prices to spike as the oil slick in the Gulf of Mexico spreads and settles. Consumers should anticipate spending more for shrimp and oysters first, and perhaps grouper and other fish later.

Gulf of Mexico fisheries are some of the most productive in the world, home to 59 percent of U.S. oyster production and three-quarters of the country's wild shrimp. People in the seafood business worry that all that could change.

Frank Chivas, co-owner of Salt Rock Grill, Rumba, Marlin Darlin' and Island Way Grill, isn't taking any chances. He bought 50,000 pounds of shrimp last week when he first got wind of the spill. He's not underestimating the potential impact of this environmental disaster.

"We're going to see the price of grouper, shrimp and other fish rise. Oysters could be nonexistent out of the gulf. This could affect things for decades," Chivas said.

Terence McElroy, spokesman for the Florida Department of Agriculture and Consumer Services, however, stresses that gulf seafood continues to be safe to eat, despite the restriction of commercial and recreational fishing in federal waters from Louisiana to waters off Pensacola Bay.

"I'm not saying that Florida is out of the woods, it depends how the currents run and how the winds are blowing," McElroy said.

Large restaurant chains like Darden (Red Lobster, Olive Garden and others) and groceries like Publix Super Markets are not yet feeling any economic impact or passing along additional costs to consumers.

"We pull from 28 different areas in the gulf, seven or eight of which are now closed. Our supply has not been affected yet. Although this is a big environmental issue, we source seafood from 30 different countries and mitigate our risk by purchasing throughout the world," said Lauren Enz, manager of seafood purchasing for Darden.

Shannon Patten, media and community relations manager for Publix, says that the product supplied out of the gulf is a very small part of Publix's overall seafood supply.

"The short term impact on most fish species should be minimal, as fish are migratory or will move to other areas to find food or avoid dangers," she said. "There may be some risk to bottom dwellers such as crustaceans or mollusks, but we aren't sure yet."

Still, many experts agree that price hikes will come.

Greg Abrams has owned Abrams Seafood in Panama City Beach for the past 21 years. He owns 12 fishing boats and 41 more work for him. Already he has sent some of those boats out of the gulf, heading to South Carolina for tuna, mahi and swordfish. He will send others to Texas for grouper and tile fish in the western gulf and south toward Fort Myers for snapper and red and black grouper. Many fishing fleets report redeploying boats to the Atlantic coast until the oil spill ramifications become more clear. Additional fuel costs and extra time and labor will eventually be passed along to consumers in the form of price increases.

Yonnie Patronis, one of the owners of Capt. Anderson's Seafood in Panama City Beach, says the first species to command a higher cost will be crabs and oysters.

"Crabs and oysters are primarily pulled from the Alabama and Mississippi coast, and those are the areas affected right now. And shrimping here will be severely impacted," he said.

Still, Patronis was not entirely gloomy. His company routinely buys its shrimp from Central America or Mexico during the winter months when it's cheaper. He has already stockpiled all he needs for the year; same goes for Florida lobster. Although there are no restrictions yet put on the fishing fleet heading out of the marina in Panama City Beach, Patronis said he and others are aggressively stocking up on grouper in the event of a fishing closure. In fact, he says, availability may temporarily go up as fishermen bring in as much product as possible, fearful that fishing will be closed.

And, as always, psychology comes into play. Chivas said he thinks wholesalers and retailers will use the crisis as an excuse to raise prices. Richard Charter, senior policy adviser of marine programs at Defenders of Wildlife, thinks that consumer confidence issues may affect prices.

"The last thing a fisherman wants to see is any hint of contaminated product making it to market. There would be a stigma on the product for quite some time — the Tylenol effect."

He says we're headed into a period of weeks or months where seafood costs will generally go up, citing how prices have fluctuated in other spills.

Gib Migliano urges calm. Owner of Saveon Seafood, a St. Petersburg wholesaler that sells to Publix and Red Lobster, he says, "The only thing consequential we'll see right now is a bump in the price of oysters and shrimp. We're fishing where we normally fish, with boats in the gulf and boats in the Atlantic. We're not pushing any panic buttons. The only fear that I have is that the whole situation gets exaggerated."

Many fishing experts agree, however, that this could potentially have catastrophic long-term effects on gulf seafood species. If containment efforts are not successful, says Charter grimly, "Consumers better like hamburgers."

Laura Reiley can be reached at lreiley@sptimes.com or (727) 892-2293.

As oil spill lingers in Gulf of Mexico, seafood prices could begin to rise 05/04/10 [Last modified: Wednesday, May 5, 2010 8:04am]

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