Alaska & Pacific Pollock
School lunches and fast-food chains
supersize demand for Alaska pollock
Flagging surimi production elsewhere in the world, increased popularity with domestic school lunch programs and steady demand from large fast-food chains should bolster markets for Alaska pollock fillets and surimi throughout the remainder of 2012.
A production development this year has changed the type of fillet blocks going to fast-food chains like McDonald's and Burger King. According to Marc Wells, president of the Seattle-based Genuine Alaska Pollock Producers, the companies shifted from pinbone-out fillets to deep-skinned fillets.
"It's a switch in product form," Wells says. "They're still using the same amount of product."
To produce deep-skinned fillets, knives run deeper to remove the fat layer next to the skin.
"Removing the layer of fat produces a whiter fillet," Wells says.
Since this process removes more skin and flesh, the excess is used for surimi production. Wells says that in terms of profits, fewer fillets and more surimi shakes out about the same. Surimi markets, meanwhile, remain strong, given lower whitefish production abroad.
According to Globefish, the reporting and information service of the United Nations' Food and Agriculture Organization, Argentina and Uruguay banned hake harvests in their shared maritime zone for three months beginning last October to protect juveniles and the hake population. Argentina's landings were down slightly for 2011 as were Chile's, where hake landings dropped around 6 percent from 2010.
"Surimi demand is very strong," Wells says. There's been a lack of whitefish from tropical countries, he says, "so markets have moved to pollock."
NMFS foreign trade data shows U.S. surimi exports to all countries jumped from around 93.3 million kilos in 2010 to more than 132.3 million kilos in 2011. Contributing to the overall increase were sharp increases among Alaska's top surimi trading partners.
Japan, which takes the lion's share, claimed more than 54 million kilos, substantially besting the 45.4 million kilos of 2010. South Korea jumped from 33.7 million kilos to 41.3 million kilos in the same time period.
Fillet block exports also skyrocketed from 81.6 million kilos in 2010 to 113.9 million kilos in 2011. Average values dropped from $1.45 per pound to $1.38 over the same period, but revenues rose from $260.6 million to $347.9 million.
"Overall, last year was phenomenal in terms of volume and value," says Andy Wink, seafood analyst with the McDowell Group in Juneau. "The fact that we're at the same pace this year is a good sign," he says.
Meanwhile, Pat Shanahan, the pollock producers' program director, says domestic demand looks strong for pinbone-out fillet blocks. More stringent federal standards to fill school lunch menus with more fish is boosting sales of fillet blocks, which are processed into other products, such as breaded fish sticks.
Shanahan, who tracks pollock volumes headed for such programs, said in August that school systems appeared to be ahead of last year in putting out bids for pollock products.
The 2011-12 school year ended on June 30 with total orders of 3.1 million pounds of pollock fillets. In August, schools had already requested bids to supply 1.64 million pounds — more than half of last year's total — for the 2012-13 school year.
"We're seeing really strong demand for seafood; so I wouldn't expect it to be less than last year," Shanahan says.
As for the health of the pollock stocks in the Bering Sea and Aleutian Islands, the fleet fished on a 2012 total allowable catch of 1.272 metric tons, up slightly from 2011's 1.271 million metric tons. Trawl survey data that serves as the basis for pollock biomass estimates, and helps set the 2013 TAC, weren't available at press time. — Charlie Ess
Gulf/South Atlantic Grouper
Fleet could score another record year,
but IFQs lead to more consolidation
In terms of the resource's health — commercial quota size and total value of the red grouper harvest — 2012 is on track to be a very good year. If the market remains robust through the seafood-friendly Christmas Advent season, total harvest value could set a record for the second consecutive year, topping the 2011 value of $15.09 million.
In the western Florida Panhandle, Buster Niquet's Panama City-based Galilean did well in March, mostly on red grouper.
"The fishing is good," said Niquet. "We're getting a real good price, close to $4."
During the summer, Tim Edge, manager at Shrimp Landing in Crystal River on Florida's upper Gulf Coast, also reported good grouper fishing. "We were doing pretty good with grouper, mostly reds," he said in late July.
As of Aug. 17, fishermen had landed 3.67 million pounds of the red grouper quota, according to the most recent NMFS data, leaving just about enough to ensure fishing through most of the year. (Recently implemented red grouper Amendment 34 catch increases were intended to "allow fishermen's individual fishing quotas to last through the year.")
Martin Fisher, Madeira Beach-based owner of two vessels, says overall, 2012 should be a good year.
"This year is going to be one of the best years since '04 and '05," he says. "It looks like we will get through most of the year [before running out of quota]."
By the numbers, the 2011 red grouper harvest, at 5.6 million pounds, was the best since 2006 on a very good annual average price of $2.68 per pound ex-vessel. With the current restrictions on gag, no commercial grouper species besides red grouper even comes close to a total harvest weight of a million pounds. Commercial red grouper quotas are projected to increase every year through 2015.
Unfortunately, not everything in the red grouper fishery is as rosy as the numbers might indicate. Fishermen still experience what they believe are Deepwater Horizon oil spill related problems.
"We've got areas that we used to catch in that we can't catch anything," Niquet says. "Right around the Mississippi Delta, you can't catch anything."
And while fishermen who did well on initial allocation in the grouper IFQ are thriving, those who must buy or lease allocation find it increasingly difficult to make a living. "You have to catch so many darn fish," Niquet says. "I'm always looking for allocation."
Fisher sees serious structural problems with the grouper IFQ.
A large percentage of that record 2011 $15 million harvest is likely coming from allocation that fishermen must lease or buy at prices so high it's very difficult to make ends meet, he says.
"Economically, probably 40 percent of those fish, somebody had to buy quota," says Fisher, who also is vice chairman of NMFS' Marine Fisheries Advisory Committee and chairs the Gulf council's reef fish advisory panel.
As for the fleet's overall health and prosperity, the total catch and harvest value don't really tell the story, Fisher says. He worries that the resource is accumulating in fewer hands and entry into the fishery is becoming nearly impossible.
"People that have quota are making out better than they ever have [but] you can't afford to be a new fisherman in the fishery anymore," he says.
The way the red grouper IFQ is structured creates problems at the top and bottom of the fishery, he says.
If share owners have large allocations, there's little incentive to participate in the fishery with their own permitted vessels. If a large share owner can lease allocation for $1.50 a pound without lifting a finger, then why go to the time and expense of actively fishing a vessel?
"Some are just leasing out quota," Fisher says. "There should have been a percentage limit on how much a boat owner can lease." IFQ owners should have to "at least send the boat to sea," he says. — Hoyt Childers
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