Auction in First Sale Fishery Market _ Part. 6 – A fishery auction is a critical component of the seafood supply chain, acting as a marketplace where freshly caught fish and seafood products are sold to buyers, such as wholesalers, distributors, processors, and sometimes directly to retailers. This auction process is typically held at fishery markets, often in proximity to major landing sites where fishing vessels unload their catches. It serves as the point where fishery products are assessed, categorized, and traded based on their quality, size, and market demand.
The primary goal of a fishery auction is to facilitate the efficient sale of seafood in a transparent and competitive environment, ensuring fair prices for both sellers (fishermen and fishers) and buyers. The auction process typically involves the sorting of fish by species, size, and quality, followed by an open bidding or lot system where buyers place bids on specific lots of fish. The highest bidder wins the lot and purchases the seafood for immediate transportation to markets or processing plants.
Fishery auctions are an essential part of managing the flow of seafood products from the source to the consumer. They provide a means of quickly liquidating the catch, ensuring fresh products are promptly distributed. Additionally, the auction system helps regulate supply and demand, determining market prices in real-time based on the quality of the fish and the level of competition among buyers. This dynamic pricing mechanism encourages both efficiency in the seafood supply chain and fairness in the transaction process.
With an emphasis on hygiene, quality control, and transparency, modern fishery auctions are equipped with proper infrastructure, including refrigerated storage, sorting tables, and sanitation measures, to ensure the seafood remains in optimal condition throughout the process. The auction environment is regulated by food safety standards to maintain the quality and traceability of the products being sold, thus supporting consumer confidence and sustainability in the seafood market.
Overall, fishery auctions are not only essential for efficient market functioning but also play a crucial role in ensuring that fresh, high-quality seafood reaches consumers while maintaining fair practices in pricing and distribution.
Fishery auction concept
A fishery auction is a structured system used for selling fish and other marine products, where buyers bid for goods based on quality, freshness, and market demand. The concept of auctions in the fish trade has evolved over centuries, with the goal of ensuring efficient, transparent, and fair distribution of seafood from the point of catch to consumers and businesses. Fishery auctions have been particularly vital in regions where fishing is a dominant economic activity, such as in Japan, Europe, and the Arab world, as they allow for the rapid sale of fresh catches and optimal pricing through competition.
Early History of Fishery Auctions Worldwide
The practice of auctioning fish can be traced back to ancient Rome, where fish were sold in open markets to ensure that consumers could purchase fresh seafood at competitive prices. The Netherlands is often credited with formalizing the first organized fish auctions in the 16th century. These were modelled on the Dutch auction system, where buyers would place bids in a public setting for fish caught in the North Sea, ensuring that the freshest products reached the market. Over time, the Dutch auction model was adopted in various European countries, and by the 19th century, fish auctions became integral parts of port towns along the coasts of countries like England, France, and Spain.
In Japan, fish auctions have become a cornerstone of the country’s seafood trade, with Tsukiji Fish Market (now replaced by Toyosu Fish Market) in Tokyo being one of the most famous examples. Tsukiji’s auction system, which involved live bidding for premium products like bluefin tuna, has been a symbol of Japan’s seafood culture, where auctions ensured both high-quality and timely distribution of fish.
In the Arab world, fishery auctions have a rich history that dates back centuries. While these markets were not always as formally structured as those in Japan or Europe, they played an essential role in the trade of fish in coastal regions. As with many other fishing cultures, Arab countries developed informal auction systems where fish were sold in open-air markets or directly from fishing boats to traders or consumers. Nowadays also in a small landing site there is an organised auction with several auctioneers.
In the Arabian Gulf and the Mediterranean, fish markets historically served as central hubs for seafood distribution. In countries like Saudi Arabia, Oman, UAE, and Kuwait, small-scale fishery auctions took place where local fishmongers would bid on freshly caught fish. Markets in port towns such as Jeddah, Muscat, Dubai, and Sharjah were critical in the trade of seafood, with fishermen and traders negotiating prices for the catch. The practice of bidding was essential to maintaining the freshness of the seafood, particularly in the hot climate of the region.
In Saudi Arabia, the Jeddah Fish Market became one of the most important fish trade centres. The market began using auction-style systems in the 20th century to accommodate growing demand. Local wholesalers, restaurants, and traders would participate in the auctions to ensure they received the best-quality fish at competitive prices.
A Common Situation
A small artisanal boat, at landing site/first sale market, start showing some fish samples. If there is a price accord, the fish is displayed to the buyers. Buyers choose and weigh what they like—the unsold fish is returned to the fishermen. The fishermen stay at the landing site until they have sold all their fish, so some days can pass. On the other side, the traders with a truck buy the fish they need but leave the market only when they have achieved full load. The fish is stored in bulks with one layer of fish and one layer of ice in the boat and in the truck. Artisanal boats only keep small storage (i.e., ice box). Sometimes, the trucks are not equipped with cooling machines and the thickness of the cold store insulation is limited. Fish is normally selected on the ground and there are several manipulations from the boat to the buyer’s truck (once the expert counted more than 10 manipulations for one stock of fish). The boat owner and the trader could stay days in the market to complete their work.
Traditional Auction
In North Africa Countries, the traditional auction is called “Mezat.” It is done by commissioners several times per day until all the fish is sold. The mezat, ancient and traditional approach for selling, requires space for commissioners and for adequate display of the fish. As all fish are sold on the same space, new auction infrastructure must be sufficient to accommodate massive demersal, large pelagic auctions (i.e., snapper, groupers, emperor, tuna) as well as space for miscellaneous low volume species. There are also peak periods for some species such as cuttlefish and shrimp. Generally, one auctioneer (sometime called agent) has the responsibility to distribute the fish payment to the different concerned parties for different baches . This type of auction is included in the sale ascending bid auction. Sometime the auction is performed in any places close to the landing site, if not well organized auction is there.
Technological advances in fishery auctions
The integration of technology in fishery auctions has played a significant role in improving the efficiency and transparency of the trade. In several countries markets auction has adopted digital platforms for online bidding, allowing remote participation and facilitating more streamlined transactions. The use of digital systems has improved traceability, with modern auction platforms recording transactions and ensuring that the origins of seafood products can be easily traced.
Agent in auctions
A local agent represents ashore the interests of the producer and performs a number of services for them. He can arrange ship’s provisions, fuel and water supply, cash money advances etc. – but also the sales of the catch on the market all on a commission basis.
He is not charged of the management of the facilities necessary to operate in such a manner (e.g. the fish market hall), the agents are solely responsible for the sales of the products. The management of the market could be public or private or mixed depending on the arrangement and the FSFM situation.
There are essentially five methods of selling used with modern electronic auctions:
- . Sale by descending bids – This method, otherwise known as a Dutch auction, is the most popular in mainland Europe, and is also the fastest. The clock starts at a high price and simply descends until one of the buyers presses his button, thereby stopping the clock. It is virtually impossible, given the accuracy of the system for two or more buyers to press buttons at the same time. If this does occur, the sale can be repeated. A minimum price is often established.
- . Sale by descending bids (alternative method) – The clock starts at a high price and then falls, as with the Dutch auction. Once the first bid is received, the price is increased by a pre-determined value and then begins to fall again. If no bid is made before the level of the first bid is again reached then the lot is sold at that price, to the original bidder. If a bid is made at a higher level than the original bid, the lot is assigned at the new, higher price.
- . Sale by ascending bid – The majority of shout auctions are operated on an ascending bid basis, whereby the price continues to rise until only one buyer is left bidding. Such a system can be operated with an electronic auction. The auctioneer starts the auction at a high price and the clock then falls until a buyer presses his or her button and stops the clock. The price then remains at that level for a pre-determined period of time. When another buyer pushes the button during the running of the timer, the price is increased by an agreed increment and the timer starts running again. This process continues until no buyer bids during the timer period and the last bidder gets the purchase.
- . Sales by ascending bid (first alternative method) – The method described above is unpopular as it slows down the auction process considerably. Therefore, a faster ascending bid method has been devised. In this case, the price starts descending and the clock stops when a button is pushed. The buyers are then given a fixed time to raise the bid by pushing their buttons. If one or more buttons are pushed during this period, the clock ascends again. The bidders do not release their buttons until they are no longer prepared to pay the purchase price. Hence the price continues to rise until only one button is depressed. If no bid is made during the fixed time, the lot is assigned to the first bidder. When this method is used, buyers cannot raise their own bids.
- . Sales by ascending bid (second alternative method) – This last method is a mixture of the two previous ones. The procedure is the same as in the method described in number 4, until the point when there is only one buyer left. At this point the buyers are able to raise the bid by individual pushes, as in the first ascending bid method described in number 3. This method allows a buyer, who decides at the last moment that he wishes to buy the lot, to still bid.
Practically the auction can be managed in different way:
-“Whisper” Auctioning: Buyers are bidding in a non-public manner
– “Shouting” auction In this most traditional manner, prices are “shouted” and buyers can bid straight to the auction master, who physically stands next to the products offered for sale. (UK, Spain, North Africa, ).
-Electronic Auctioning, here the products are offered through some automated (electronic sometime online) sales tool ensuring a more transparent market and more efficient transaction generation. (Aucxis trading solution).
In this last case there are some advantages such as: recording of supplies/catalog, recording of sales, display with product information, price and possibility to bid, data information processing. In this system the auction is very fast and efficient, information is spread very rapidly, there is financial control possibility, there is additional added value for all operators and the chance to buy is fair. Every area needs to have a tailor-made system adapted to the local traditions. The auction could also be remote, avoiding the presence in the hall, more products available and based on a PC.
Anyway, the Auction have a presentation period where all the buyers can see the products in advance, then there is a bidding process performed in different way. For example, there is a bidding conveyor where the fish are shown in small crate, and anyone can bid or a bidding floor for larger batches of fish. For large quantities during high catching season some biddings are performed at the jetty
From humble beginnings in coastal fishing villages to sophisticated, high-tech auction systems, fishery auctions in the world have adapted to meet the growing demands of both local and international markets. As these systems continue to evolve, particularly with the integration of digital platforms and a focus on sustainability, third countries are solidifying their role as key players in the global seafood trade.
Auction in First Sale Fishery Market _ Part. 6
