Young's set to lose £30m Asda contract

THE seemingly endless merry-go-round of winning and losing major fish contracts took a new turn last night with news that Young’s Seafood is poised to lose a £30 million contract with the supermarket chain ASDA. The impact on jobs is still to be assessed.
The contract is in two parts – a shrimp or prawn processing arrangement which has gone to Labeyrie Fine Foods of France and the supply of white fish (mainly cod and haddock) which looks like being taken up by Albert Darnell of Grimsby, now part of Chessington, Surrey, based New England Seafood International.
Young’s said it was disappointed but stressed that Asda remained an important customer – presumably through it sale of its Gastro Range and other Young’s branded products.
The company also pointed to recent impressive sales growth and contract wins. Asda said it will not comment on individual contracts, but added that Young’s would remain a significant partner.
Young’s is currently up for sale, with a deal expected by the end of the year, so this latest development will not sit easily with its private equity owners, despite securing important new markets in the United States.
However, the seafood processing industry is currently in a state of turmoil, with contracts being won and lost on a regular basis.
Young’s recently won an M&S coated fish deal from Grimsby rivals Five Star Fish, which is closing its factory on the Humber.
And in a highly controversial move it has announced the closure of its Pinneys salmon plant in Annan, Scotland, moving the fresh salmon operation to Grimsby by the end of the year.
UK fish processors are coming under intense pressure as prices continue to rise. Further contract changes among companies look almost inevitable over the coming months.