Written by Jen Finn
October 2, 2012
Gulf/South Atlantic flounder
Assessments leading quotas upward, downside is economy's effect on price
Economic conditions continue to drag on flounder prices — with no real signs of improvement for the short term — while summer flounder quotas have begun to increase, reflecting improved stock assessments.
On the North Carolina Outer Banks, the southern flounder pound-net fishery, which generally begins producing in late spring and peaks in late summer or early fall, was mediocre, says Tilman Gray, owner of Avon Seafood on Hatteras Island. Recent ex-vessel prices were in the $2 range.
"The southern flounder, it probably averaged $2 a pound," Gray says. "It was OK, not a good season."
For the previous three seasons, southern flounder and summer flounder average ex-vessel prices marched in lockstep. They ranged from a low of $2.12 in 2006, to a high of $2.38 in 2007, and then back down to $2.17 in 2008, according to figures from the North Carolina Division of Marine Fisheries.
The 2008-10 recession, now characterized by persistent unemployment and a decline in prospects for local and small business, has shown little sign of lifting in North Carolina coastal communities, Gray says. Seafood prices reflect this.
"No, it is not over," Gray says. "The only ones that say it's over is the ones that got this grant money... or have federal jobs."
Summer flounder quota increases have thus far been insufficient to compensate for flat or sagging ex-vessel prices for both summer and southern flounder.
For 2010, North Carolina, Virginia and New Jersey have the largest state quotas for summer flounder with 3,382,502 pounds, 2,897,955 pounds and 2,154,122 pounds respectively.
Greg DiDomenico, the Garden State Seafood Association's executive director, says New Jersey's market was relatively weak, too.
"Most of what's really driven it has been the economy," he says. "Bottom line, things are not good. Most people in business are being somewhat conservative."
In Wanchese, N.C., Willie R. Etheridge Seafood Co. had a decent spring fluke season, says general manager Steve George. Prices there have ranged from $1.50 to $2.50.
The early 2010 season was unusual, however, with fewer trips than normal because of weather and other factors.
"We had a very weird season, one trip a month in February, March," he says. "The ones in April were getting $1.50 to $2."
With roughly 80 percent of the annual quota caught, the North Carolina fishery is now closed down until the fall, when the remaining 20 percent can be harvested.
With the North Carolina fishery closed, the market focus shifts to states that still have significant quota unharvested. As of early May, Virginia had fished 56 percent of its quota, New Jersey 36 percent and Rhode Island 44 percent, according to a NMFS coastwide weekly landings report.
George says it is frustrating to see a plentiful resource like flounder but be unable to fish it.
Sean McKeon, president of the North Carolina Fisheries Association, says fishermen generally believe the flounder quotas are lagging the biology by a substantial margin. Science, they add, is not the determining factor.
"Guys tell me you could double it — you'd never see a change in the stock," McKeon says.
Summer flounder, with its roller coaster stock-assessment and quota ride of the past 10 years, is an excellent example of a fishery in which politics has become a primary market component. NGO-driven federal regulations and inflexible rebuilding schedules hobble domestic production in favor of imports and promote a downward market-share spiral.
In many cases, environmental groups are controlling federal policy, and resultant statutory overfishing determinations have "regulated many fisheries into oblivion," McKeon says.
"I think it's a very, very dark period right now," McKeon says. — Hoyt Childers
Uncertainty rules as fleet charts new course in sector management system
An avalanche of consequences from the new New England groundfish management system began rolling in May, with high landing rates for flounders and haddock that some predicted could close down the remaining fleet fishing in the "common pool" of days at sea by August.
For the majority who joined the groundfish sectors, uncertainty reigned almost daily. Captains are unsure how far their assigned shares will take them and how they will acquire more through quota transfers.
Prices in Gloucester, Mass., were as high as $3.80 for large cod in early May but dropped.
"People are steaming away from large cod because markets" — medium-sized cod — "are worth more. It's crazy," fisherman Paul Theriault of Rockport, Mass., said in early June.
At the end of May, big landings of scrod haddock sold for around $1 a pound in Gloucester and New Bedford. Market cod brought around $1.65 and small catches of pollock garnered around $1.55. At the end of May in 2008, market-sized to large cod got $4 a pound although landings were just a few thousand pounds a day. Then as now, scrod haddock was abundant, selling for $1.30 to $1.88. Pollock sold for 75 cents to $1.40.
Theriault says he thinks sector uncertainty is driving market swings. The danger is that retailers and restaurants won't commit to what they see as uncertain supply. "I see the market constantly disrupted," he says. "I've seen shrimp markets go away because of that."
Pollock, usually a poor relation in the groundfish marketplace, is critical in the new management regime. As a so-called choke species, it was feared low harvest limits could shut down sectors early.
But a draft working paper on pollock assessment issued May 28 that says the species is "not overfished and overfishing is not occurring" changed all that.
In an emergency move June 16 NMFS officials said they would slide the pollock quota up from 2,748 metric tons to nearly 16,000 metric tons. That could remove the most immediate bottleneck, but winter and yellowtail flounders are another threat.
NMFS and dealers were reluctant to venture what May catch numbers meant for the future of catch shares.
Longtime industry observer John Sackton, editor of Seafood.com, was criticized for his analysis that saw higher catches in the first week of May. But even after reconsideration Sackton wrote that at least 51,000 more pounds sold through Boston, New Bedford and Portland auctions compared to 2009 and confirmed some captains "were able to get better trips under the new system."
Common pool fishermen working under days-at-sea management were landing more, too. But their May catch rates were high — perhaps as much as one-third of their 2010 share for Gulf of Maine winter flounder and Georges Bank yellowtail flounder, NMFS reported.
Gulf of Maine haddock catches were 13 percent of the quota in May and big catches could overrun the limits, the agency said when it cut species trip limits May 27. Previously unlimited, haddock was reduced to 1,000 pounds in the Gulf of Maine and 10,000 pounds on Georges Bank and Massachusetts to southern New England.
Previously there were no winter flounder harvest restrictions in the Gulf of Maine, but the limit now is 250 pounds. The offshore Georges Bank trips for winter flounder have been reduced from 5,000 pounds to 1,000 pounds. Georges yellowtail catches have dropped from 2,500 pounds to 1,000 pounds.
A lawsuit led by New Bedford and Gloucester city officials asserts sector requirements will force vessel owners to spend $17,000 to $22,000 per boat. Meanwhile average gross annual landings value across the fleet have fallen to $130,000. Those additional costs "will reduce all vessels below a financial break-even point and eventually bankrupt the fleet," lawyers Stephen Ouellette and Pamela Lafreniere wrote in the May 9 complaint to the U.S. District Court in Boston. — Kirk Moore
Alaska & Pacific Whiting
Certification, new assessment model should nudge fishery in right direction
A larger harvest quota, recent Marine Stewardship Council certification and the health of the European economy are all factors to watch as this year's Pacific whiting fishery progresses.
Recent changes in factors used within the stock assessment model painted a picture of higher abundance, the outcome of which translated to a somewhat higher quota of 141,000 metric tons for this year. Last year's quota of around 136,000 metric tons, which was roughly half of the 269,600 metric ton quota set in 2008, sent the industry reeling.
The larger quota is based on two factors: For 2010, the Pacific Fishery Management Council blended two competing stock assessment models, thus yielding a slightly higher exploitation rate. On top of that, recruitment of the 2005 age class into the fishery looks promising.
All eyes have been on the class of 2005, as the years roll on. The industry was hoping that the young whiting would come in with the zeal of the 1999 age class, which has driven the fishery for years. However, representation of the 2005 fish hasn't been quite as strong, according to John DeVore, stock assessment coordinator with the Pacific council in Portland, Ore.
"They're pretty sure it's not a super-abundant year class," DeVore says. "But it's above average."
The mid-May season opener brought scant deliveries, according to Pete Leipzig, executive director of the Fishermen's Marketing Association in Eureka, Calif.
"It has been hit or miss," Leipzig says. "But the [ex-vessel] price is higher this year at 8 cents a pound." That beats the 6 cents per pound seen in 2009 but is lower than the 10 cents per pound trawlers received in 2008. Whiting brought 6.9 cents in 2007, considerably better than the 4 cents of 2004.
Though this year's quota leaves the fishery poised for a larger harvest, the question still looms of how eagerly markets will absorb product. In the midst of last year's global economic downtick, banks throughout Europe — where much of the whiting products wind up — were hesitant in their lending when it came to financing various distribution chain sectors.
Like the biomass assessment model, this year's economic climate also seems brighter.
"The requests coming in this year are a little bit stronger," says Mike Okoniewski, general manager with Pacific Seafood in Woodland, Wash. "I'm not saying that they solved all of their economic problems, but some of the pessimism seems to have dwindled."
Last year's MSC certification of the fishery's sustainability should help marketing connections, even when it comes to U.S. exports to China.
"They buy it in H and G or with the tail off, reprocess it into IQF fillets, then sell into markets throughout Europe where customers require the MSC label," says Brendan McKenna, an agent with Pacific Seafood's Asian export sales department. European consumers have become increasingly conscious of buying fish that have been managed for sustainability, according to Okoniewski.
Meanwhile, the 2009 whiting export volume to all countries totals 35.7 million kilograms. That's down by about 8 percent from the 39 million kilograms of 2008, but is substantially less harsh than the decline from 2007, when the industry exported around 62 million kilograms worldwide. The decreases of recent years reflect the economic skittishness experienced abroad.
By far, the largest share of exports — about 30 percent of U.S. whiting production — goes to Ukraine. In 2007, more than 24 million kilos of whiting went to Ukraine. In 2008 and 2009 the country claimed in the neighborhood of 11 million kilos.
Last year, China accounted for 13 percent of the total worldwide exports and volumes going there fell by 12 percent. Germany, another top contender for market share, posted a decrease of 27 percent last year. — Charlie Ess
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