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Alaska Fish Factor: Nice Gains for Alaska Fishermen, Processors

28 May 2013
 Alaska Fish Factor: Laine Welch Laine Welch has been covering news of Alaska’s seafood industry for print and broadcast since 1988. She also has worked ‘behind the counter’ in wholesale and retail seafood businesses in Alaska and Cape Cod, MA. Laine lives in Kodiak, Alaska. www.alaskafishradio.com

msfish@alaska.com
 
 

US - It takes quite a crew to get an Alaska salmon from “boat to throat,” and everyone along the line gets a cut of the catch. How that “value chain” has paid out in the past few years shows some nice gains for Alaska fishermen and processors.

“We often get asked what share the fisherman retains, and how much each segment of the supply chain gets for salmon. The answer depends on the species, and the product you are talking about, and what gear type,” said Andy Wink, a fisheries economist with the McDowell Group in Juneau who compiled the report for the Alaska Seafood Marketing Institute. “

Wink’s report tracks and compares from 2008 – 2011salmon ex-vessel (dock price) payouts for fishermen and first wholesale value for processors, which typically is defined as the value of the product as it leaves Alaska.

The chain illustrates three examples, showing values from high to low returns for fishermen, with troll caught kings topping the list.

“In this case, the harvester bleeds and dresses the fish and adds most of the value before delivery. The processor basically just holds and ships out the fish, and acts as more of a distributor,” Wink explained.

For that reason, the Chinook fisherman gets a higher return; 40% of the final retail value in that four year time frame. The value chain for sockeye fillets follows a very different pattern.

“In this example, the processors are taking on fish in the round, filleting them, packaging and freezing, they’ve got a lot more labor and capital expended. It’s the processors who are adding more value, and for that reason they get a larger share,” he explained.

Canned salmon follows a similar pattern in terms processors adding value to the raw product, he added.

Comparisons from 2008 show nice gains throughout the salmon value chain, and the trend is likely to continue.

“The share of the first wholesale value paid to fishermen has increased, and we attribute that to higher prices for salmon in general,” Wink said. “If salmon prices are higher at the wholesale level, processors are going to have more funds to compete for fish. And that’s what we see going on here.”

Forecasts call for less sockeye salmon meaning “there might not be enough to go around” which could boost those prices. And despite a big rebound by farmed fish from Chile, Wink said Alaska wild salmon prices are holding strong.

“There has been some weakness in the frozen pink and chum market recently, but besides that, it’s been pretty good going. All the work Alaska has done since the start of new millennium is starting to pay off to keep our market share,” he said.

In another sign of how times have changed, Alaska sockeye exports to Japan were down 72% last year. Not long ago, nearly all of Alaska’s red salmon went to that one country. Chile has taken a lot of market share within Japan, but there doesn’t seem to be any shortage of demand for sockeye from the US market and the European market as well, Wink said.

New rules for hired skippers - The practice of hiring skippers to fish for other people’s quota shares is set to undergo some big changes.

Last April the North Pacific Fishery Management Council approved a plan to limit the use of hired skippers who fish quota shares initially allocated to others when the IFQ plan began in 1995.

When the halibut and sablefish quota share program hit the water, federal managers envisioned a primarily owner-operated fleet that would reduce pressure on the resource, and provide entry level opportunities for coastal Alaskans. But over 20 years, the number of hired skippers has surged from eight percent to 50 percent. Many of the absentee quota owners have been charging them high “rents” for their fish; that’s cut into crew wages and inflated the costs for quota shares.

A proposed rule has been published in the Federal Register that would bar an initial quota share recipient from using a hired skipper to harvest any halibut or sablefish shares acquired after a cutoff date of Feb. 12, 2010.

Comments on the new rule are being accepted by NOAA Fisheries through May 28 via the federal e-Rulemaking portal at www.regulations.gov .

IFQ bids online - Bids on repossessed quota shares can be made on line through the Alaska Dept. of Economic Development. Right now there is one listing for 28,419 pounds of halibut in Area 4A, along the Aleutians the near Dutch Harbor. A scan of fishing permit broker sites shows 4A shares selling for between $15- $24 per pound.

Death by sunscreen - All that sun block being slathered on by beach-goers around the world is causing major damage to ocean corals. A study funded by the European Commission revealed that the mix of 20 compounds used to protect skin from the harmful effects of the sun causes rapid bleaching of coral reefs.

The World Trade Organization reports that 10 per cent of world tourism takes place in tropical areas, with nearly 80 million people visiting coral reefs each year. The WTO estimates that up to 6,000 tons of sun screen lotions are released into reef areas each year – and that up to 10 per cent of the world's coral reefs are at risk of ‘death by sunscreen.’

While Alaska’s deep sea corals face threats from ocean acidification, they are safe from sun screens. Unlike tropical varieties, Alaska corals don’t form reefs – they grow into dense gardens and can live for hundreds of years. The waters surrounding the Aleutian Islands are believed to harbor the most abundant and diverse coldwater corals in the world.

This material is protected by copyright. For information on reprinting, contact msfish@alaska.com

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