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What now for German frozen food market? Weak economy, war fallout cloud future: consumer confidence falls, as petrol prices rise along with unemployment. Disposable income is shrinking. Still, folks have to eat. Discount retailers are doing well, and traffic should pick up at value-oriented fast food restaurants. Frozen food sales seem to be recession-proof. (News from Europe).

Article Excerpt
"Last year was the worst I can remember for shrimp marketers in Germany," candidly commented Jurgen Schulz, managing director of Hamburger Feinfrost. "We were hoping that demand would pick up measurably during the Christmas and New Year period, but it never happened. Just before the holidays, consumers bought small quantities of seafood that went almost directly from hand to mouth."

With unemployment rising along with the price of petrol and other commodities, many Germans were not in much of a mood to party hardy during traditional New Year galas and family gatherings. Most folks continued to hold tightly onto their wallets and limit discretionary spending in the first quarter of 2003. Uneasiness about distant thunder and darkening war clouds gathering over Iraq and the Middle East added further gloom to the economic picture.

Uncertainty about the future was thick in the air both at home and abroad in February, when editors of this magazine surveyed the country's frozen food production and marketing sectors from the northern state of Hamburg and Lower Saxony [where columns of US and British tanks and other armored combat vehicles were seen being trucked via autobahn to awaiting transport ships at the port of Emden], southward to Nurnberg, and from Westphalia eastward to Hesse and Thuringia.

But then uncertainty is something that food traders in general and seafood importers in particular have been steadfastly coping with for a number of years now.

Strict EU enforcement of zero tolerance levels for trace elements of illegal antibiotics and other substances detected in imported foodstuffs has destabilized the supply of tropical, farm-raised shrimp from Asia [See related stories on pages 62 and 64.], as shipments from leading producing countries have been subjected to automatic detention pending laboratory analysis.

Sensational stories in the popular press suggesting debatable links between tropical shrimp consumption and potentially serious health problems were rehashed again and again during much of 2002. The adverse impact of the repetition continues to be felt by the trade.

"Some restaurants in Germany have taken shrimp off the menu, as ongoing negative publicity on television and in the newspapers has depressed sales greatly," Mr. Schulz told Quick Frozen Foods International during an interview at his office in Hamburg's Altona section. "Major fast food operators, who used to prominently feature shrimp products from time to time, don't even consider menuing them now because of the perceived risk that worries some customers."

The fact that prices charged for restaurant dishes have risen substantially since replacement of the Deutschmark by the Euro as official currency does not help matters. And the nation's economic stagnation has generally slowed traffic into foodservice establishments other than fast food outlets.

The cost of conducting business is getting higher for importers and exporters, who are obliged to foot the bill for inspections which can run as much as EUR 360 per item tested. Highly sensitive laboratory detection equipment utilized in Europe is apparently operating more efficiently than the same standard of gear that is on the job...