Written by Jen Finn
Successful 2006 season casts hope for recovery of biomass and demand
A strong 2006 show of scup in Northeast waters and a modest recovery in consumer demand has some fishermen thinking this longtime pillar of the mixed trawl fleet could recover some of its strength.
Big, full tows and early season prices that achieved $2 a pound for some crews contrasted with glum scientific assessments for scup. That has fishermen and managers alike wondering if the measures of the scup population's apparently mediocre recruitment success are accurate.
Now regional and state managers are weighing options for a new measure, called Amendment 14, to the combined plan for summer flounder, scup and black sea bass. Amendment 14 would adjust scup fishing limits and help that stock grow faster.
When it comes to scup, managers, fishermen and scientists agree the biological measures are so imprecise, they can't really be certain about the state of the species. That has them talking about all kinds of Amendment 14 options.
"We started to see a little bit of a resurgence in the market in the last year or so," says Chris Brown, a South Kingston, R.I., captain and president of the Rhode Island Commercial Fishermen's Association. "I'm worried that if they whack us back down again [with lowered quota], that market will erode again."
In recent years, opening season prices for scup around $1 per pound would drop quickly to around 30 cents in Rhode Island. Boats competed to supply a market of buyers who had soured on scup's declining availability. In contrast, those $2 to 85-cent prices in 2006 showed a marked recovery, Brown says.
"As industrious as fishermen are, fish dealers are just as industrious. Give them a steady supply, and they'll figure out a way to market it," Brown says. "There's a tremendous amount of scup out in the ocean.
"Nice big fish, too. We chose to use 6 1/2-inch mesh," he adds. "This should be a management success story. But the good efforts of fishermen and managers are going to waste in this fishery."
A staple for fish-fry restaurants, scup — known as porgies in New York and southward — are popular in ethnic African-American, Asian and Mediterranean communities. Conveyor lines at the fishermen's cooperative docks in Belford and Point Pleasant Beach, N.J., sloshed with tons of scup coming out of fish holds in early 2006. Crews "couldn't put a net down anywhere without catching fluke and scup," Belford co-op manager Joe Branin told state regulators at one December 2006 meeting in New York City.
But years of quota limits on landings and seasonal times took a toll on consumer loyalty, says Phil Ruhle, captain of the Rhode Island boat Sea Breeze.
"We've already destroyed the market with low quota. We're rebuilding that, very slowly," says Ruhle, a longtime adviser to scup planners.
So the low hover of catch below quota is just a bottom line. In 2008, newly equipped government survey trips might raise the scup numbers and validate fishermen's reports, he adds.
The key problem lies in the federal Northeast Fisheries Science Center's spring trawl surveys, according to federal and state managers. The scup management plan set a biomass threshold that says there should be 2.77 kilograms of scup, little more than 6 pounds of the fish, in an average sample tow. The three-year average as of 2004 was 0.69 kilograms, or less than 1.5 pounds, per tow.
In 2005 NMFS determined that scup are in an overfished status. Still, management documents show exploitation rates have declined in the fishery since 1995, and there's much uncertainty about the real state of the fish.
"There's no doubt that it's a bad assessment. Everyone recognizes that," Ruhle says.
New Jersey fishermen and the National Fisheries Institute had proposed an independently funded survey for scup and other species, to be paid with fractional set-aside quota dedicated for research. But scup science proposals got waylaid by the 2006 uproar over summer flounder that became a focus of the East Coast fishing community's discontents last year, Ruhle says.
Meanwhile, enterprising dealers are finding ways to adjust their inventory to the scup season, Brown says.
"A lot of the price is supported by the frozen market," he says. "When the price is 40 to 50 cents a pound, they will freeze and hold the product for 90 or 120 days, then roll it out when the fresh prices are back up to over $1 a pound." — Kirk Moore
Chinook scarcity, high prices posing biggest challenges for 2007 season
The 2006 West Coast salmon season was one of the worst on record — and 2007 isn't looking much better, industry officials and buyers say.
"Nothing is looking red hot," says Paul Heikkila, a Pacific Fishery Management Council Salmon Advisory Subpanel member and retired Sea Grant agent.
Heikkila says Klamath River fall chinook returns had the greatest impact, closing fishing along much of the Oregon and northern California coasts and severely restricting it along much of the rest. Columbia River returns were a little lower than predicted but not devastating, he says. Early predictions for the Sacramento River returns show fewer fish as well.
Nonetheless, there is good news on the Klamath River, according to Heikkila.
Even though commercial effort is managed on returns of 4-year-old fish, predictions of 2-year-old fish are 10 times what they were last year.
"Last year was a disastrous prediction," Heikkila says. It's possible, he says, that in a couple years, the salmon troll fishery could once again have a bountiful season. The 2007 season may not be much improved, but there is hope for 2008 and 2009.
But the questions then will be much same as when chinook rebounded in the 1990s: Will fishermen have to sacrifice prices to regain customers? Not even 10 years ago, processors were paying fishermen around $1 a pound, when the Columbia River as well as Oregon and California salmon seasons were in full swing and the market was flush with fresh fish.
A look at the 2006 season may help to provide an answer.
When unprecedented salmon closures were predicted, fishermen feared losing market share to farmed product.
"That hasn't really happened. There has been enough Alaska fish to help" supply the market with wild salmon, Heikkila says.
Dock prices stayed high throughout the season, above $4 a pound and occasionally higher than $6 a pound, as buyers scrambled to find West Coast kings. The average price of $3.09 a pound rose almost $1 over the average price of $2.34 a pound in 2005.
On the West Coast, preliminary Pacific States Marine Fisheries Commission figures show chinook was responsible for $15.4 million to fishermen this year.
That translated into kings that sold in the marketplace for upward of $20 a pound, a price consumers so far have been willing to pay.
Despite its name, the Wild Salmon Seafood Market, at Fishermen's Terminal in Seattle, sells a variety of seafood products. But salmon is "far and away" what his buyers look for the most, says owner Jon Speltz.
Speltz says he buys fish from several places. Finding the best kings for the best price is a constant challenge.
"We're always looking for good quality," Speltz says. "Oregon's been a good source of king salmon since forever, but we've purchased very few Oregon kings this year."
So, instead of paying an average of $12.99 a pound for Oregon chinook filets, customers at Wild Salmon's seafood counter fork over between $14 and $16 a pound, Speltz says, and other places in Seattle and around the country charge upward of $20 a pound. Thus, consumers could drop $200 on a small 10-pound king.
The problem is the high prices could force consumers either to buy less fish or turn to a substitute.
Customers once bought a whole fish, which Wild Salmon Seafood Market would filet into portions customers could freeze, Speltz says. "Now they're buying for one meal instead of a whole fish," he says.
Speltz sees another problem: Wild kings could be in danger of losing market share. In 2007, which is expected to be as bad as or worse than the 2006 season, Speltz says he plans to try to sell more sockeye and coho, mostly from Alaska. Kings, Speltz says, could face an uphill battle regaining their foothold.
Processors, too, had trouble selling a variety of fish, since salmon drives much of the sales of other species. Salmon is just one product on a buyer's list, and buyers usually hope to source from one processor or distributor. If they can't, many will turn to the competition.
Management limits of 50, 75 or 100 fish per week for fishermen on some parts of the coast compounded processors' problems during the summer. The demand for salmon was there, but there were too few fish to truck at one time.
But, Heikkila says, as long as Alaska's salmon seasons are productive, that will help the West Coast retain its place in the market overall.
"We just have to keep some fish in that niche," he says. — Susan Chambers
Gulf/South Atlantic Grouper
Price, stocks and demand are strong,but will red and gag survive politics?
Demand for domestic grouper remains very strong, and so does the price. Stocks are arguably in decent shape. The real question for the two primary commercial species, red and gag, is whether the fishery as fishermen have known it will survive the political, allocation and management conflicts now surrounding it.
Red grouper averaged $2.30 a pound ex-vessel in 2006, according to preliminary numbers from the Florida Fish and Wildlife Research Institute, while gag averaged $2.85. These prices are at or near all-time highs in dollars and cents, though still below the $1.55 red grouper brought in 1986 when adjusted for inflation.
Lynn Haven, Fla., skipper Buster Niquet, owner of the 58-foot longliner Galilean, says fishing was pretty decent in 2006.
"We caught quite a lot," he says. "It was good until about three months ago; now they're starting to pick back up a bit."
Red grouper landings overall appear to be down a bit through September, compared to the same months in 2005. But vessels now operate under a 6,000-pound trip limit that kept the fishery open most of last year, versus 2005 when the shallow water grouper quota forced an Oct. 10 closure.
The 6,000-pound commercial trip limit is among measures NMFS approved, at fishermen's request, to avoid such early closures and to meet a 2012, 10-year rebuilding target for red grouper.
Both red grouper and gag, though not officially designated as overfished, are "undergoing overfishing." That means NMFS considers the annual harvest in excess of maximum sustainable yield.
Fishermen generally accept the 6,000-pound trip limit as a necessary — or at least unavoidable — burden of membership in the reef fish club, but it has put the bigger vessels in a bind, Niquet says.
"With the 6,000-pound trip limit, they're just barely making it," he says. Caught between high fuel prices and the 6,000-pound trip limit, some of the larger vessels have tied up indefinitely.
Proposed changes to reduce gag mortality by 13 to 43 percent threaten to sideline even more vessels and marginalize the domestic fishery. The changes a stock assessment review panel recommended also would affect the recreational fishery, which, according to NMFS, accounted for 99 percent of the dead gag discards in 2004.
Such a high percentage of recreational dead discards is believable, Niquet says.
"It's hard to keep them alive when you hold them in the box until you've got a bigger one," he says.
A stock assessment review committee's preferred option is to reduce gag mortality by 13 percent, but the Gulf of Mexico Fishery Management Council is still considering alternatives.
Many fishermen believe proposed cutbacks for commercial fishermen are unfair and unnecessary. Under current regulations, the commercial fishery closes if either the red grouper quota or the overall shallow-water grouper quota is filled.
Eric Schmidt, a vertical line fisherman from Naples, Fla., says gag cutbacks will force a much earlier closing of the shallow-water grouper fishery, which includes red, gag and black grouper.
"The reductions are not going to be pleasant," he says. "Gag will trigger it."
Schmidt says he can't see how such commercial cuts are justified when gag biomass is near its historical high and spawning biomass is at a historic high, according to the 2006 stock assessment.
"We're getting screwed," he says. "The changes are arbitrary."
The real danger for the U.S. grouper fisherman here is that closures will push wholesale buyers toward imports. That would send domestic grouper the way of so many other U.S. fisheries that annually see their market share slip closer to the point of no return.
For now, the market is strong, and red and gag grouper are among a very few fin fisheries that remain profitable for Gulf of Mexico fishermen. But decisions to be made in the next year or so (a new red grouper stock assessment is due in 2007) will be critical to the industry's survival.
The Gulf council recently implemented a Feb. 15-March 15 recreational closure for red, gag and black grouper. The closure coincides with a similar spawning season closure for commercial vessels that began in 2000.
Recreational organizations are not happy about having to make sacrifices similar to those commercial fishermen have made for years. They dispute NMFS data showing an extremely high level of recreational dead discards.
Additional recreational sector cuts include a one red grouper per day bag limit within a five grouper overall bag limit and zero bag limit for captains and crews of vessels under charter.
— Hoyt Childers
North Pacific Herring
Japanese yen for holiday treat wanes, triggering efforts to curtail processing
Declining consumption in Japanese retail markets appears to have caught up with the ex-vessel end of the Alaska herring roe industry, and the cure may be to crimp supplies coming out of Alaska in 2007.
In the 2006 season, ex-vessel prices for herring sac roe at Sitka started out abysmally low at $200 per short ton — a far cry from 2005, when the fleet saw prices of up to $510 per ton. Though average ex-vessel values were considerably lower at Togiak, another major production area, prices there fell from $147 to $103 during the same period.
"It's a tough situation," says Bob Nickinovich, chairman of the Alaska Seafood Marketing Institute's Roe Herring Committee and president of North Pacific Seafoods in Seattle.
According to Nickinovich, the 2005 ex-vessel prices were disproportionately higher than what retail markets could bear, shaving processors' profit margin.
Processors, meanwhile, struggle to achieve economy of scale when profit margins grow thin. The processors' attempts to procure enough volume to cover their fixed costs often translate to competition that can whack ex-vessel prices out of the ballpark during the fishing season.
"You can't sit there and let somebody take the volume away when you've got millions of dollars tied up," Nickinovich says. "You've got to minimize the loss."
Compounding the industry's financial conundrum is that many processors don't realize profits (or losses) for the kazunoko crop until oseibo, the Japanese year-end holiday, which occurs months after the last herring has been caught.
"You have to remember that whatever is harvested is in the early part of the year and isn't sold until the later part of the year," Nickinovich says. "What sets the [ex-vessel] value is how well the product sold during the previous fall."
Nickinovich visited Japan in the preamble to oseibo late last November. Many companies had only liquidated inventories held over from 2005, Nickinovich says. That didn't bode well for moving inventories accumulated from the 2006 season.
The relative strength of the Japanese yen to the U.S. dollar, meanwhile, slipped slightly last year. During the buying seasons of April 2004 and 2005, the yen traded at an average of 107 to the dollar. In 2006, however, the yen's value had fallen to 117 to the dollar.
Higher roe recovery also played a hand in the higher 2005 ex-vessel offers. With weights of the roe skeins running at an average of 11.4 percent of the whole fish at Sitka, buyers were moving more sellable product across the docks, per ton, than in 2004 when the recovery rate was 10.75 percent and last year, when it was 10.5 percent.
As for factors nearer the retail end, Japanese consumers have seen a sharp increase in the availability of substitute products.
"In the reality, herring and herring roe consumption have been dropped year by year," says Lee Sung Hwa, Japan marketing representative with the Alaska Seafood Marketing Institute in Japan. Sung Hwa adds that Japan has seen a similar decline in the consumption of rice, pickles, tofu, processed surimi and salmon roe.
Simultaneously, steady supply volumes coming from Alaska and increasing volumes coming from Russia have thrown the supply and demand model out of balance.
"In a declining market arena we still continue to produce more," Nickinovich says.
In hope of relaxing the rubber band of market elasticity, the Canadian industry has announced plans to cut production by half in 2007, according to Sung Hwa and others.
Alaska, in response to the crash in demand, also has curbed production, albeit unwittingly, in the form of reduced processing capacity among fewer buyers.
"It's pretty severe," says Dave Gordon, a herring management biologist with the Alaska Department of Fish and Game in Sitka. "Some of the processors have dropped out."
According to Fish and Game data, the number of processors at Sitka has suffered a steady decline from 10 in 2001 to six last year.
In 2006, the statewide harvest quotas were set at more than 49,000 short tons, but fishermen took just shy of 40,000 tons. In 2005, the fleets took 41,468 short tons of a statewide quota of 45,747 tons.
The 2007 herring seine quotas, meanwhile, are set at 16,554 short tons at Togiak and 11,655 tons at Sitka. The 2007 gillnet quota for Togiak, meanwhile, is set at 7,090 tons. Just how much volume winds up on Japan-bound cargo ships will set the table for retail demand during oseibo later this year and contribute to the setting of 2008 ex-vessel prices.
— Charlie Ess
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