Modern Scots are not generally known for their high levels of fish consumption, yet new fish restaurants and shops are opening at an unprecedented rate. Last year in Glasgow alone, four new city- centre fish restaurants opened, with another handful coming on stream later this year. Delicatessens across the country have also started selling fresh seafood, while independent fishmongers are going more upmarket.

This heartening trend would appear to be at odds with the official statistics: fewer than half of us eat the recommended two portions of fresh fish a week and, officially, consumption is down 8%. This apparent anomaly is further highlighted by the fact that the volume of fish being sold at the Glasgow fish market at Blochairn, the only inland wholesale market in Scotland, has dropped by 80% in 10 years. Some 10,000 boxes sold daily a decade ago have shrunk to fewer than 2000, and the number of fish merchants has declined from more than 20 to six. Footfall is also almost non-existent. Gone are the days of the 6am bell to mark the start of business, with long queues of buyers rushing in.

So what's the catch? EU fish quotas may have restricted the time our boats have at sea and the volume they can catch, but restaurants are not reporting difficulties in obtaining fish. And although fish and shellfish are Scotland's top exports, with a value of some £700m annually, there is still plenty to go round at home. According to Donald Neilson of the long-established Vallance fish merchants, which has around half the space at the Glasgow market, it is the advent of the supermarket fish counter that has put many independent fishmongers out of business who would have bought their stock from the market. And supermarkets are not buying Scottish fish. "They purchase their fish centrally from Grimsby and Hull."

Since it moved in 1979 to Blochairn from the Briggait at the Clyde - where the fishing boats used to come direct from the Ayrshire coast - the market is closer to the M8 and major distribution networks, but it has also become less accessible to city residents.

But if the Glasgow market appears to be struggling in the face of resurgent demand, there are now moves to resuscitate it. Glasgow City Council is to invest £5m next month when a new company, City Markets (Glasgow), takes over at Blochairn as a limited liability partnership (LLP) working with Glasgow City Council on an initial five-year lease. Graham Wallace, Glasgow council's group manager of markets, who hopes to run the new LLP, explains how this will change the look and purpose of the fishmarket, as well as the fruit, vegetable and flower markets. "The difference will be that the markets are more self-determining. Profits generated by the markets will be ploughed directly back into the markets instead of being pooled in a general pot."

The first priority is the rather mundane task of recladding and reroofing the existing buildings, and retarmacing the road network. More excitingly, new signage to make the markets more visible from the M8 and local neighbourhoods are also promised. This visibility is vital if the fishmarket is to keep its place in the public awareness as the rise of supermarkets continues unabated. Wallace acknowledges there has been a lack of confidence in the fish market owing to a prolonged lack of investment. He insists: "This move is sending out the message that the council wants the market to remain, and to remain where it is. We're looking to raise the markets' profile and prominence."

A new filleting department has already been installed to service a client base that demands prepared fish. But there are other challenges. A shift to supplying restaurants and hotels means fish has to be fresher and more exotic. "The quality on offer has to be improved because restaurants are incredibly demanding, and the fishmongers that do continue in business are going upmarket," says Wallace.

Which neatly puts the onus on the merchants, who must find good supplies of the imported seabream and seabass, king prawns, turbot and tilapia that are now in demand alongside salmon, haddock, halibut, sole, langoustine, monkfish, hake, lythe, pollack, herring, crab, scallops and lobster. The days when Glasgow only had to find vast quantities of haddock and whiting for its chippies are numbered. Established merchants' names such as McPhee, Semple and Mckechnie have disappeared from the market. Vallance, which supplies restaurants such as le Chardon d'Or and Ichi Ban, as well as Lochgreen Hotel in Troon, is experiencing the benefits of diversifying. "We've had to diversify," says Neilson. "It's about working harder to carry a wider range of products and to try to keep the volume at the same level as before. The market is competitive. We have to be as fresh as possible."

Alan Inglis, of S&A Seafoods, is also upbeat: he has just bought out his brother's half of the business and invested in new delivery vans.

But is it all too little, too late? Have suppliers and their customers grown accustomed to having fresher, more exotic fish delivered from other markets? John MacCallum will be sourcing his fish from Peterhead, Aberdeen, Shetland and Troon, while Mairi Taylor will use Just Hooked on Skye. Seumas MacInnes, of Gandolfi Fish, uses his own supplier on Barra, as well as the Glasgow market.

Wholesale fish merchant Graeme Fraser, of the firm Andrew McDicken, which has had a site at the Glasgow fishmarket for 80 years, feels there should be more emphasis on individual customers so a local demand is created which would keep the market on the suppliers' map. The 35-year-old, who has been at market since he was 16, has seen many changes. "The tragedy was moving the fishmarket out of the Briggait to avoid heavy goods vehicles clogging up the city centre, because it took the fish away from the people," he says. "Glaswegians don't realise what they've got on their own doorstep. If it were up to me, I'd move the fish market in with the fruit, veg and flower markets so they're all under one roof, with cafes and restaurants, and advertise them aggressively - as they do anywhere else in Europe and at London Borough Market. People would be enthused by such an environment and it could create a huge cultural shift at ground level."

Creating a demand from local people on lower incomes as well as foodies is crucial if the market is to continue, agrees Andy Bell of The Fish People, who runs his own fishmonger in Glasgow as well as supplying restaurants in Glasgow, Edinburgh and Ayrshire. He sources his fish not only from Glasgow but also from Mallaig, Fraserburgh, Peterhead, Shetland and Barra because he needs continuity of supply for his market, which he has built up over 30 years. He says many urban Scots eat fish in restaurants but will not buy it to cook at home.

"Troon fishmarket has gone, Edinburgh fish market is smaller than Glasgow's, and the Aberdeen market is not doing too well," he says. "The markets further north are getting busier, but I do think the Glasgow market has a future if it is nurtured properly.

"For a variety of reasons, fish is now expensive and I think the Scottish Government could do more to help it become available to people on lower incomes. It could promote fish in the same way it has promoted fruit and veg, and it could find ways of bringing the price down. Supermarket fish is not always sold very well, and just one bad experience can put people off for life."

Graham Wallace would like to establish a council-run seafood training school at Blochairn along the lines of the operation at Billingsgate in London, where the market is 50% retail and 50% wholesale. This would teach people how to buy, prepare and cook fish - and even which wines to have with it. "There is no such skills academy in Scotland, but there should be and I'd like it to be here," says Wallace.

For now, he will continue with school visits to try to educate a new generation about the benefits of fish. Tom Lewis, of Mhor Fish in Callander, launched his own fish academy this month with the same intention, and plans to invite as guest speakers the Scrabster fishermen he has been using as his suppliers. "We need to get more Scots eating fish so that more of it stays in this country," he agrees.

If Glasgow's market is no longer the one-stop shop it used to be, it doesn't worry Donald Neilson, who has his own list of suppliers. "The market has changed totally in the past 10 years. It's gone from being a people market to being more of a distribution centre for west and central Scotland," he says. "Now it's become a round-the-clock operation, with chefs phoning in their orders the night before and traders trying to get their orders out to them in time. There's more involved in getting fish to the end-user now than ever before. But it's certainly achievable."

Glasgow's fish market has been given a substantial lifeline. But the question remains: will it take the bait?