Gulf/South Atlantic TUNA
High price of fuel, shaky economy plague an otherwise healthy fishery
Tuna fishing in the Southeast sometimes begins to pick up a bit in March after the winter lull. But this year weather was limiting fishing of any kind in the Mid-Atlantic and the Gulf of Mexico, and tuna fishing hadn't really begun.
"Lots of wind; the boats haven't been out since Friday," said Steve George, general manager of Willie R. Etheridge Seafood in Wanchese, N.C., one Tuesday morning. "We have two or three days of blow, then a day of fishing."
George was hoping for a good start to the tuna season in April.
The story was much the same in the Gulf of Mexico, where tuna fishing typically doesn't get serious until sometime after Easter.
High winds were keeping boats at the docks, says Greg Abrams, owner of Greg Abrams Seafood in Panama City, Fla.
"It's blowing and blowing and blowing," he says.
The weather problem would rectify itself in a few weeks or a few days. However, another problem that keeps vessels dockside is only likely to worsen.
"The [diesel] fuel is killing us — $3.72" on the morning of March 19, says Abrams, who must keep a half a dozen dual-gear longline-bandit vessels fueled.
Tuna prices were pretty good in 2007, averaging $3.23 a pound for all grades on Florida landings of 700,000 pounds, one of the best harvests in several seasons, according to the Florida Fish and Wildlife Research Institute.
But who would have thought, two years ago, that a gallon of diesel fuel would cost more than the ex-vessel price of a pound of grill-grade yellowfin tuna?
Florida fishermen also landed a few bluefin in 2007, 13,825 pounds worth $55,886 on 30 trips.
In Wanchese, the fall 2007 tuna fishing was reasonably good, George says.
"There was some fish around," he says, with most yellowfins "mainly in that 40- to 60-pound category" and ex-vessel price in the mid-$3 range. The Wanchese fleet also caught more bigeyes than usual and a few bluefin that brought $5 to $12 a pound, he says.
Overall, 2007 North Carolina yellowfin landings, at 1.21 million pounds, according to preliminary North Carolina Division of Marine Fisheries numbers, were good, though down slightly from 1.22 million pounds in 2006, which is the best year since 2000.
For a premium finfish like tuna, the current economic downturn coupled with still rising fuel costs is especially worrisome and raises lots of as yet unanswerable questions. How high will diesel go? Abrams wouldn't be surprised to see $5. Can increases in fuel costs be passed on to the consumer when the economy is slowing?
In this economic environment, tuna's premium status may be problematic. In the domestic market, high-end sales — gourmet restaurants, sashimi bars — are likely to suffer during recession.
As for exports, U.S. economic troubles are likely to equally affect Canada, the biggest consumer of fresh U.S. yellowfin. The occasional fresh bluefin from North Carolina, New York or Boston does end up in the Tokyo markets, and U.S. problems are less likely to directly affect prices there, but this is a tiny part of the market overall.
Americans eat many more tuna steaks than the domestic fishery can provide. Most of it comes from yellowfin, and most of that fresh yellowfin comes from Trinidad and Tobago, the Philippines, Vietnam and Costa Rica, in that order.
From 2005 to 2007 fresh yellowfin import volume has been creeping up — 37.62 million pounds to 39.65 million pounds — while its value has increased more rapidly, from $116.58 million to $137.42 million.
For January 2008, the latest month for which import numbers are available from NMFS, fresh yellowfin volume, at 3.15 million pounds, was slightly less than the January 2007 volume of 3.25 million pounds, while import value increased from $10.50 million to $11.21 million.
Fortunately, given the otherwise uncertain economic outlook for 2008, the basic underpinnings of the yellowfin fishery, the South Atlantic and Gulf of Mexico's most valuable tuna fishery by far, appear sound. Yellowfin are plentiful and the price is good, if not as good as it needs to be compared to the ever-increasing fuel price.
Like most fishermen, Abrams worries about fuel costs and what continuing increases might mean.
"Diesel fuel drives the country," he says.
But like most fishermen, he's also an optimist.
It's just time to hunker down and push harder. If you're going to be in the business, you've got to believe things will work out, he says.
"It's gonna be OK; just work a little harder." — Hoyt Childers
Domestic calamari demand offsetting dock price hangover in global markets
Prices in global squid markets declined thanks to a huge rise in South Atlantic production during 2007. That effect lingered in spring 2008, as South American fishermen glumly contemplated high fuel costs and low opening season prices reported at little more than $700 U.S. per metric ton.
But calamari is popular on North American appetizer menus, so solid domestic demand for American-caught squid, especially longfin (Loligo pealei) now helps insulate a fishery once dependent on export markets. Fall 2007 prices were 70 to 75 cents a pound to Mid-Atlantic boats. A slow start to the 2008 season pushed them up around $1.
"There's nothing that takes the place of our Loligo pealei. It's a unique product. The domestic end of the market dominates," says Jimmy Ruhle, a Wanchese, N.C., fisherman and chairman of the Mid-Atlantic Fishery Management Council's squid, mackerel and butterfish committee.
Squid catches were off in early 2008 compared with the same time in 2007, most likely because of weather conditions, Ruhle says. "Last year we shut down with something like 20 days left on the [first] trimester" of the season, he says.
In late 2007 the United Nations Food and Agriculture Organization predicted squid prices wouldn't rise again in the first half of 2008. The agency says last year's southwest Atlantic squid production may have hit 350,000 metric tons, the highest level since 2000, helping Argentina recapture much of its market in Japan — largely at the expense of American producers, who saw their exports fall.
"Price-wise, it's going to be average" in 2008, Ruhle concurs. But based on chatter from dealers and buyers at trade shows, he thinks global demand is building again and has "cleaned up a lot of that inventory" from 2007.
FAO statisticians also noticed an 18 percent decline in Chinese squid exports to the United States last year. They blame the decline on importers' negative reactions to 2007 food safety scares with other Chinese products.
This year East Coast squidders are working under the second year of a trimester season with four-month divisions.
"It looks like people are pretty happy with it," says Richard J. Seagraves, a Mid-Atlantic Fishery Management Council analyst. The council is maintaining last year's total catch limits of 17,000 metric tons for loligo and 24,000 metric tons for shortfin (Illex illecebrosus) squids.
Trimester limits break down as 7,310 metric tons in the peak January through April season, then 2,890 tons through August and a final 6,800 tons in the fall.
Butterfish, which is classified as overfished, remains a major bycatch problem for squid harvesters. The council has lowered the incidental trip limit from 5,000 to 1,000 pounds of butterfish. Boats then must switch to a 3-inch mesh net, which squid captains say effectively ends the trip.
"We're trying to manage two fisheries at once," Seagraves says. The council cut directed butterfish landings to 500 metric tons, he says, "basically freezing the fishery where it's been for the last three years," and using some of the permissible butterfish take to make up small-fish discards, "where we might forgo some butterfish landings and trade them off for more loligo."
"Otherwise, they're looking at mesh size increases," Seagraves adds. Industry advocates say they can't afford that.
A Rutgers University study of optimum cod end sizes for squid fishing reveals that just moving the industry standard mesh of 1.8 inches up to 2.5 inches would reduce catches of market-size loligo by 79 percent. "Mesh sizes needed to exclude butterfish reduce catchability of loligo squid to levels below economic viability," the researchers concluded.
In June the council is holding hearings on Amendment 10, its plan for reducing bycatch. Environmental activists are putting on pressure for bigger mesh size and other measures to reduce butterfish takes.
Bycatch estimated around 22 million pounds in 2001 now stands at around 8 million pounds annually, but "the main reason is there are fewer butterfish around," says Brooks Mountcastle of the Marine Fish Conservation Network, which cited the squid-butterfish relationship in a recent critique of the Mid-Atlantic council.
"We know we're catching less," Ruhle says, because the fleet has experimented with different mesh configurations in recent years. If a stock assessment could be done, butterfish could be in better shape than the current overfished status indicates, he says.
But the only viable strategy for now is to save butterfish as a buffer to keep the squid fishery, Ruhle says. "With anything over a 2-inch mesh size, you don't have a fishery." — Kirk Moore
North Pacific salmon
'Genuine growth' in market for fresh sockeyes could propel prices upward
More salmon to fresh markets should continue to improve gross revenues for Alaska's fleet, particularly for the folks whose sockeye salmon are destined for domestic outlets at the retail end.
Last year, Alaska reported that landings of headed and gutted fresh salmon (all five species) hit 34 million pounds, a 27.3 percent increase from 26.7 million pounds in 2006.
Accompanying revenues for fresh headed and gutted salmon jumped from $66.3 million to $81.2 million, up 22 percent over 2006, the state's Department of Revenue reported.
Of the above numbers, fresh headed and gutted sockeyes accounted for almost 14 million pounds in 2006 and 18.8 million pounds last year, about a 34 percent increase. According to annual data from the Department of Revenue, which reports only volume, Alaska produced 3.2 million pounds of fresh sockeye fillets in 2007, 138 percent higher than 1.34 million pounds in 2006.
"I think what you've got there is genuine demand growth, combined with a strong sockeye harvest," says Chris McDowell, a seafood industry analyst with the McDowell Group in Juneau.
"Sockeyes will be the ones to watch," says McDowell, who also harvests Bristol Bay sockeyes and runs a troller for kings and cohos in Southeast. "While the ex-vessel values for the other four species have gone up pretty substantially in recent years, sockeye prices have not."
That could change if the demand trend continues and the Alaska industry keeps developing the infrastructure to put even more fresh fish on planes headed for domestic markets.
It would be a stretch to say Alaska wild sockeyes have begun to give farmed Atlantic salmon a run for its money in terms of market share. But McDowell notes that rising costs associated with shipping — and the relatively shorter distance fresh sockeyes travel from the fishing grounds to fill niches created by imported fresh Atlantics from Canada and Chile — could provide the impetus for increased demand.
Gunnar Knapp, professor of economics at the University of Alaska Anchorage's Institute of Social and Economic Research, cautions that the various apportionments of each species comprising the mix of Alaska's catch in any given year must considered when analyzing data. However, he says, the increased presence of Alaska's wild-caught salmon in domestic markets can't be ignored.
"My anecdotal sense is that the amount of Alaska salmon going to the U.S. market is substantially higher than it was 10 years ago," Knapp says. "You can just see that if you go into the supermarkets."
Ample sockeye harvests in recent years have also created a consistency of volume available to those markets — another factor bolstering demand, according to McDowell.
"If you look at the 100-year historical salmon data," McDowell says, "we've exceeded annual harvests of 40 million sockeyes for 14 years in a row."
The 2008 Bristol Bay sockeye forecast calls for 31.4 million sockeyes, up from last year's harvest of 29.8 million. The statewide sockeye harvest, meanwhile, projects at 47.2 million.
Among economic factors affecting Alaska's other salmon species, the bounty of the 2008 harvest could dictate directions in product flow and product forms, McDowell says.
The Alaska Department of Fish and Game is predicting a statewide commercial harvest for all five species of 137 million fish. That total would be considerably lower than last year's catch of 213 million fish.
A bumper crop of 143 million pink salmon drove last year's harvest total, the fourth largest since Alaska took over salmon management as part of statehood in 1959. This year's pink salmon harvest predictions call for 66.4 million, 53 percent less than what the fleet landed in 2007.
Overall, preliminary Fish and Game dock price data for 2007 shows the statewide average chinook price per pound slipped from $3.03 in 2006 to $2.68.
However, product availability should buoy ex-vessel prices for troll- and gillnet-caught kings from Southeast Alaska, given the West Coast salmon fishery disaster, McDowell says.
Statewide coho prices also dipped from $1.04 in 2006 to 83 cents. Chum prices fell slightly from 32 cents in 2006 to 30 cents. Pink prices rose from 16 cents in '06 to 17 cents, and sockeyes slipped from 76 to 75 cents.
However, harvest volumes made up for lower dock prices. The 2007 statewide harvest total stands at 212.6 million fish worth $374.4 million versus 141 million salmon valued at $346.4 million in 2006. — Charlie Ess
Hawaii longliners finding large fish, few turtles as 2008 gets under way
Hawaii's swordfish fishery has been good so far in 2008 — and longliners hope the trend continues.
"Good, large fish are being taken," says Sean Martin, president of the Hawaii Longline Association, "and we're still at zero loggerheads [turtles] for the year, which is an anomaly."
Through early March, swordfish longliners had only three turtle interactions during the shallow-set fishery: one olive ridley, one leatherback and one green.
It's in stark contrast to past years. Fifteen loggerheads were incidentally taken throughout 2007. In 2006, 17 loggerheads — the total allowable incidental catch — were caught by mid-March and the season closed for the year on March 20.
Between 15 and 18 vessels were making longline sets in early 2008, Martin says, and the only downside so far this year is weather: snowstorms on the East Coast, primarily. Weather around the Hawaiian Islands has been good.
"The market is always being influenced by airlift capacity," Martin says. "It's a fresh-fish market; almost 100 percent is exported to the mainland."
That variability in weather thousands of miles away affects Hawaii and dramatically affects prices.
"The prices are all over the board, but that could change tomorrow," Martin says. Longliners were getting between $2 and $5 a pound for swords in January, February and March.
The other issue affecting longliners for a few years is fuel price. Escalating diesel cost for vessels that travel hundreds of miles away, primarily to fish outside the U.S. exclusive economic zone, is a major factor.
"They just cracked $3 a gallon," Martin says, though the price hovered between $2.85 and $3-plus for a few weeks. "I think it will have a significant effect on some of the larger vessels that travel a long way."
Martin says higher tuna prices are helping offset fuel prices.
The swordfish fleet traditionally also makes deepwater longline sets for other fish, such as bigeye tuna and yellowfin tuna. In 2007, the number of tuna trips increased at about the same time the number of swordfish trips dropped, during April.
Recently, however, bigeye has been under specific quota restrictions that have limited effort in that fishery and, in a way, have had an effect in other areas.
"It's nice to have some of the effort diverted to swordfish," Martin says. "It keeps the bigeye take down."
The trade-off between swordfish and tuna is enabling Hawaii's longline fleets to survive. After years of high swordfish catches, the fishery was closed in 2001 because of concern over turtle takes. Since the sword fishery reopened in 2004, turtle takes, except for 2005, have been so few and so minor that things could change, Martin says.
Observer coverage on the swordfish fleet is 100 percent. Between January and March of 2007, the first quarter, interactions with seven loggerheads and two leatherbacks were recorded. Of those, none were seriously injured and there was no mortality, Martin says. During the second quarter of 2007, there were seven loggerhead interactions and three leatherbacks, also resulting in no mortality and no serious injury. The third quarter was even better: Only one loggerhead interaction, with no serious injury.
"They may re-evaluate the shallow-set fishery based on this," Martin says. "It's pretty precautionary now."
The deep-set fishery — for tunas — takes fewer turtles, but there is higher mortality because the turtles drown.
But nobody knows why there are fewer turtle takes this year.
"There's not really any change in fishing practice," Martin says.
Even so, the Pacific Islands Fisheries Science Center began publishing temperature charts this year that show narrow bands of water with temperature characteristics possibly favored by turtles. Martin says scientists suggested staying out of those bands of water earlier in the year.
"As it happens, the band is not very wide," Martin says. "But it demonstrates how little we know."
Management changes on both sides of the Pacific also could change the market balance in the future.
The Western Pacific Regional Fishery Management Council is considering modifications to its permitting system.
"It would incorporate some of the new information that's become available that has to do with changes in the fishery that have resulted in reduced turtle take," Martin says.
Closer to the U.S. mainland, the Pacific Fishery Management Council is looking at a limited-entry swordfish fishery — a shallow-set longline fishery outside of the U.S. EEZ. The council plans to approve one of the three alternatives at its September meeting. — Susan Chambers
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