By LAINE WELCH
September 26, 2009
"Whether you're talking fish or crude oil or timber or minerals, people around the world are producing competing products and selling into the same markets. And they are working very aggressively - as hard as we are - to try and increase their share of those markets. So we are always affected by what our competitors are doing, and their ups and downs in supply," said Gunnar Knapp, a fisheries economist at the University of Alaska/Anchorage.
The ups and downs in their currency values are another price driver for seafood and other natural resources.
"Anytime you have a product that is exported, the value of currencies compared to the US dollar will play a role in what people in the foreign country will pay to get that product," Knapp said.
Japan and the European Union are two of Alaska's most important seafood markets, and those currencies have flipped flop a bit since last year. The exchange rate for the dollar and the Euro are up compared to each other, while the dollar and the yen are about the same, Knapp explained.
"The changes are enough to make a difference, but it's not a dramatic difference from a year ago," he added.
Knapp said what fish processors can pay fishermen is limited by two basic things: how much they are able to sell their products for, and what their costs are. Sales of canned and frozen seafoods are often made months after a fishery ends, adding to the price uncertainty.
"But the bottom line is that it's a big world out there and what happens in the those markets plays right down to the prices the Alaska processors get and the prices the fishermen get," Knapp said. "There is a lot going on and it's always changing, especially in fish production because so much depends on nature. Some things work in our favor and some work against us."
A case in point
Working in favor of Alaska's salmon markets is a 60% drop in the availability of farmed fish from Chile, the #1 exporter to the U.S. Chile's $2.2 billion farmed salmon industry is in a state of collapse due to a deadly fish virus, and its production is not expected to be back on line until at least 2011. A Chilean government task force also cited the farmed salmon industry for 'hair raising' use of antibiotics to control the disease outbreaks.
Intrafish reports that the price differentials between wild and farmed salmon have narrowed this year. On the west coast, for example, farmed salmon fillets have been hovering at the $6 per pound mark, not much less than wild cohos or even net-caught wild kings. Chum salmon is selling for even less than farmed fish, Intrafish said. Buyers told Intrafish that global demand - especially for wild sockeye and coho salmon - will be stronger due to the farmed fish shortfall.
Never one to miss a market opportunity -- Norway has stepped up its strategy to fill U.S. orders. Through August, Norway sent 23 million pounds of fresh farmed salmon fillets to the U.S., valued at more than $90 million. That's an increase from just three million pounds of salmon fillets from Norway last year.
Alaska crabbers will drop pots for a lower snow crab catch this winter, but it might not be as drastic as many had feared. In a letter to state and federal managers from Robert Mecum, Acting Administrator of the Alaska Region, said NOAA fisheries scientists have recommended a snow crab catch of 50.5 million pounds, a drop of 14 percent.
The decrease does not stem from the snow crab stock being in danger; rather, their numbers have not yet reached a rebuilding target required by a 10 year federal rebuilding plan after it was classified as overfished in 1999. According to the plan, the biomass needs to reach 317 million pounds in order to be considered 'rebuilt.' It is estimated at 260 million pounds now.
Along with snow crab, managers said two other Bering Sea stocks need to be rebuilt - Tanner crab and Pribilof Islands blue king crab. Tanner crab is approaching an overfished condition, Mecum said, and the rebuilding plans for blue king crab have not resulted in adequate progress.
For Tanner crab, the North Pacific Fishery Management Council has two years to prepare and implement a rebuilding plan. Managers have recommended a 5 year time period that ends in the 2014 fishing year. The letter said that the Tanner stock can support a fishery during that time.
The Pribilof fishery for blue king crab has been closed for 10 years. To further protect that stock, crab scientists are recommending restrictions on pot cod and all groundfish fisheries in that region.
On a brighter note, the blue king crab stock at St. Matthew Island is now considered rebuilt. That fishery, which has been closed for 10 years, may reopen this winter. Managers are set to announce the Bering Sea crab catch quotas any day. Most of the fisheries open in mid-October.