Alaska/Pacific Coast

Snow crab fishery off to slow start
Harvests expected to pick up as more vessels move out of Pacific cod and bairdi tanner crab fisheries
The Cordova Times by Margaret Bauman – February 4, 2015
Harvest figures for the commercial Bering Sea snow crab indicate it’s another slow start season for this fishery, a total allocation of 6.8 million pounds notwithstanding.
http://www.thecordovatimes.com/article/1506snow-crab-fishery-off-to-slow-start

LEGALITY UPHELD – Supreme Court rules in favor of Bristol Bay Forever initiative
Decision confirms that mining in Bristol Bay Fisheries Reserve must get approval from Alaska Legislature
The Cordova Times by Margaret Bauman – February 4, 2015
Alaska Supreme Court judges have ruled in favor of the legality of the Bristol Bay Forever Initiative, which was challenged in a lawsuit even before voters approved it in last November’s general election.
http://www.thecordovatimes.com/article/1506legality-upheld-supreme-court-rules-in-favor

Mount Polley Mine Report Highlights Threats to Alaska Salmon, Fishing Jobs and Communities
SEAFOODNEWS.COM [Alaska Native News] by Heather Hardcastle – February 5, 2015
A diverse group of Alaskans said a report released today on the Mount Polley mine disaster in British Columbia (B.C.) provides new evidence that mines planned and under construction in the B.C. headwaters of highly productive Southeast Alaska salmon rivers are a threat to multi-billion dollar fisheries and a way of life for thousands of Alaskans. They call for the U.S. State Department to engage in meaningful bilateral discussions with Canada that ensure better safeguards for salmon before such mines are allowed to move forward.

“Today’s report underscores that, when it comes to the safety of large-scale mines, B.C.’s track record speaks for itself. The Mount Polley disaster is a stark example of B.C.’s stewardship of a project that the government and the developer claimed was safe. We can’t let a similar accident taint the rivers of the transboundary region along the border between northwest B.C. and Southeast Alaska,” said Mark Jensen, mayor of Petersburg Borough, one of Southeast Alaska’s largest fishing communities.

The independent review panel appointed by the B.C. government concluded the dam failed due to a design flaw which was not caught in the permitting process. It stemmed from a portion of the dam’s foundation being built on glacial soil that proved to be unstable as the tailings pond grew heavier. One of the engineers on the panel described Mount Polley as a “loaded gun” waiting to go off. The panel recommended that B.C. adopt better practices and use best available technology with safety a priority over economics. Alaskans are concerned that such fundamental changes in B.C. mining practices won’t be adopted due to time and expense and that there is no guarantee that such changes will actually reduce the long-term risks of transboundary mines.

The Mount Polley tailings dam was approved by Canadian regulators to last in perpetuity, yet it failed in less than 20 years. The August 4, 2014, disaster sent an estimated 6.6 billion gallons of toxic mine waste and wastewater into the Fraser River watershed. The Fraser is one of Canada’s most important salmon-producing rivers. The environmental impacts of the spill will take years to fully comprehend, experts have said.

Mount Polley mine owner, Imperial Metals, is constructing a much larger mine, Red Chris, in the northwest B.C. headwaters of the Stikine River, one of Southeast Alaska’s most prolific salmon producers. A recent independent review of the Red Chris tailings storage facility found serious design flaws, raising concerns that a similar Mount Polley-style disaster would contaminate Alaska waters. Despite this, Imperial Metals still plans to open Red Chris mine in early 2015.

“The transboundary region supports fisheries vital to Southeast Alaska. A similar accident at a transboundary mine like Red Chris could release large quantities of tailings that are more toxic than the Mount Polley spill. The Mount Polley disaster was a clear sign that B.C. cannot assure us transboundary waters and fish won’t be polluted by the province’s aggressive mining agenda. The Sitka Assembly passed a resolution in October 2014 urging stronger oversight to ensure that Alaska resources are not harmed by upstream development in B.C. A review by the International Joint Commission would be a step in the right direction,” said Mim McConnell, mayor of the City and Borough of Sitka.

The International Joint Commission is a bilateral commission established by the 1909 Boundary Waters Treaty, charged with resolving transboundary water disputes between the U.S. and Canada.

“Under the Boundary Waters Treaty, the U.S. and Canada are both committed to not polluting waters on their own side of the border to the injury of health or property on the other side of the border. Canada is not taking their treaty obligation seriously. We ask the State Department to work with Canada to ensure the treaty is respected and our interests are protected,” said Heather Hardcastle, a gillnetter and co-owner of Taku River Reds based in Juneau.

Even before the Mount Polley disaster, Alaskans had been pushing for the U.S. to have an equal seat at the table with Canada in discussions about how and if watersheds shared by both countries are developed. This equal footing currently doesn’t exist. The vast transboundary region is not only home to multi-billion dollar seafood and tourism industries, but to many tribal citizens, as well.

Multiple large-scale, open-pit mines like Red Chris are currently in various stages of development in the watersheds of three productive transboundary salmon rivers, the Taku, Stikine and Unuk, which flow from B.C. into Alaska. These projects raise red flags for many, including tribes, commercial and sport fishermen, tourism operators, municipalities and political leaders who have spoken out in numerous resolutions and letters.

“Today’s report raises more concerns than it answers. We need to halt these mines from moving ahead until our concerns are addressed. We have the right to be consulted on actions that could harm our culture and livelihoods, even if those actions are happening in Canada. This is why we need the State of Alaska and the State Department to do all they can to defend our way of life in the face of these threats,” said Rob Sanderson Jr., co-chair of the United Tribal Transboundary Mining Work Group, which includes 13 federally recognized tribes.

In late December 2014, despite thousands of objections from Alaskans and Canadians, including Alaska’s congressional delegation and legislators, the Canadian federal government approved KSM, a massive mine project just 19 miles upstream of the Alaska border. Critics compare the size of KSM to Pebble, a hugely controversial mine proposal in Bristol Bay. If built, KSM could leach acid mine drainage, heavy metals and other toxins into the transboundary Unuk River that drains into Misty Fjords National Monument near Ketchikan, Alaska.

Clay Bezenek, a Ketchikan-based gillnetter, is also frustrated with B.C.’s fast-tracked mining plans for projects like KSM.

“The Unuk River has been kept wild by the people of Southeast Alaska. The importance of the health of the Unuk to our commercial seine, gillnet and troll salmon fisheries can’t be overstated. To not have all concerned parties at the table when discussing projects of this magnitude is a mistake. I’m calling on Alaska Governor Bill Walker and on Secretary of State John Kerry to help get us to the table now,” said Bezenek.
Today’s report focuses on the technical and engineering reasons for the Mount Polley dam failure and does not address shortcomings in Canada’s mining regulations that may have contributed to the dam failure. Although the report recommended changes to mining practices, there is no guarantee any of these measures will be adopted at proposed transboundary mines or if such measures can ensure tailings dams will not fail over the very long term.

“The tailings dams at these mines are environmental time bombs. It’s not a question of if they are going to fail, it’s just a question of when. We just shouldn’t be putting large tailings dams near vital water sources and fish habitat,” said Marsh Skeele, a troller and vice president of Sitka Salmon Shares, a seafood company based in Sitka.

More information, images and a map are available at www.salmonbeyondborders.org
http://www.seafoodnews.com/Story/962323/Snow-Crab-Harvests-Off-to-Slow-Start-as-Has-Been-Typical-for-Last-Few-Years

How Much Debris Litters Alaska’s Beaches?
APRN – Anchorage by Steve Heimel – February 4, 2015
Thanks to funding from the government of Japan, plans are being made to pick up hundreds of tons of plastic marine debris that has been gathered from Alaska beaches.
http://www.alaskapublic.org/2015/02/04/how-much-debris-litters-alaskas-beaches/

Marine Safety Instructor Training
Alaska Dispatch News- February 5, 2015
The Alaska Marine Safety Education Association (AMSEA) is conducting a six-day Marine Safety Instructor Training at AVTEC in Seward, Alaska, from April 14 to April 19, 2015.
http://www.adn.com/event/20150204/marine-safety-instructor-training

International

Marine Harvest Has Strong Year with $3.38 Billion Turnover, and 32% Jump in Earnings
SEAFOODNEWS.COM [Undercurrent News]  by Tom Seaman – February 4, 2015
Bergen, Norway-based Marine Harvest reporting Q4 earnings that exceeded consensus, in spite of the impact on the market from the Russian import ban.

The company announced operational earnings before interest and taxes (ebit) of NOK 1.03 billion ($136.67 million), flat year-on-year, but up on the consensus of NOK 990m.

Marine Harvest reported Q4 revenue of NOK 6.86bn, up 1.77% year-on-year, with net profit of NOK 110m, down 91.48% y-o-y. The drop in net profit is driven by a lower value placed on the company’s biomass and also an increase in financial items.

The company announced a quarterly dividend of NOK 1.2 per share, above a consensus of NOK 1.07.

For the full year, turnover was NOK 25.49bn ($3.38bn), up 32.58% y-o-y, with operating ebit at NOK 4.25bn, up 32.44% y-o-y .  Europe is by far the largest market for Marine Harvest’s salmon with 73% of the total revenues in Q4 2014, compared to 68% in the same quarter of 2013.

As a result of the ban on import of salmon from most European producers, the sudden reduction in the Russian purchasing power and the lack of customer guarantees, Russia’s share of sales has been reduced from 6% to 2% from the fourth quarter of 2013 to the same period in 2014, the company said.

The closure of the Russian market has been less of a problem for Marine Harvest than some its competitors, as the company “benefits from its global sales reach and logistical flexibility, its comprehensive contracts with long term customers and its increasing share of salmon sold as value added products, with less volatile prices”.

Marine Harvest has proved less sensitive to regional cost variation due to its geographically well diversified production structure, the company said.

Despite this, “the fourth quarter was, however, impacted by the reduction in Russian purchasing power, high regional costs due to biological challenges in Europe and weak prices in Americas”, said Marine Harvest.

For 2015, the outlook looks positive for the company, both in farming and processing.

 Marine Harvest is guiding for y-o-y increases in volume in Norway, Chile, Scotland and Canada for Q1 and the full year, with volumes up 9% in the first quarter.

In Q3, the company was guiding for 430,000t, although this did not include 15,000t from Chile relating to the company’s acquisition of Acuinova Chile.

The company’s annual growth target of 5% is at the high end of estimates for global production in 2015, of 2.108 million metric tons.

Marine Harvest’s farming and processing operations were all in the black in the fourth quarter, aside from Scotland.

The company had guided for a loss in Scotland in Q4 in January and the result was in line with this. Processing sources had told Undercurrent News the market was left short of salmon, which Marine Harvest said was the case.

As a result, Marine Harvest reported an operating loss of NOK 22m for the quarter in Scotland, compared to a positive ebit of NOK 120m for the same quarter of 2013.

“The reference price in local currency was down by 17% in the quarter compared to the fourth quarter of 2013 due to increased Norwegian supply. The price achievement in the spot market was lower than in the same period last year due to low prices achieved for small fish,” the company said.

The fourth quarter harvest volume was 6,376t in gutted weight, significantly down from Q4 of 2013, when it was 11,716t.Screen Shot 2015-02-04 at 08.14.08“Harvest was accelerated earlier in the year to mitigate biological risk. This combined with biological challenges and reduced survival in the harvest generation, resulted in harvesting of small fish in the period to cover our contract commitments,” the company said.

“The biological situation improved in January with better survival rates and growth, but the challenging second half of 2014 will result in high cost and low volume harvested in the first half of 2015,” said Marine Harvest.

The challenging biological situation in Scotland contributed to a 4% increase in biological costs for salmon harvested in the period compared to the fourth quarter of 2013.

The feed cost has been reduced due to lower feed raw material prices and improved feed conversion ratios.

The cost of medication and other treatment related costs have increased compared to last year, due to preventive amoebic gill disease (AGD) and lice treatment and mitigation costs, the company said.

Other seawater costs were also affected by low average harvest weights and the cost increase compared to the fourth quarter of 2013 was 23%.

Non-seawater costs have increased compared to the fourth quarter of 2013, due to mortality and low volume.

Losses were recorded at several sites due to algae, AGD and lice treatments. Exceptional mortality in the amount of NOK 58m was recognized in the period, compared to NOK 17m for Q4 of 2013.

Due to the biological challenges, it was also decided to harvest out one site early as a result of poor performance, the company said.

As the cost per kg at this site exceeded the net realizable value, a write down in the amount of NOK 9m was recognized. Total exceptional costs related to biological challenges amounted to NOK 67m in the period, compared to NOK 17m for the same quarter of 2013.

Strong result in Norway

Marine Harvest reported strong results in Norway, its largest farming unit.

The operational ebit for salmon of Norwegian origin for Q4 was NOK 881m, up 6.78% y-o-y, with earnings per kilogram at NOK 12.59/kg, compared to NOK 12.04/kg.

The reference price for salmon of Norwegian origin increased compared to the third quarter due to strong seasonal demand in Europe. The average reference price in the quarter was NOK 38.41/kg compared to NOK 34.35/kg and NOK 40.97/kg in the third quarter of 2014 and the fourth quarter of 2013 respectively.

In the fourth quarter, the company farmed 69,941t in gutted weight salmon in the quarter, compared to 68,581t.Screen Shot 2015-02-04 at 08.30.43

The profitability in the four Norwegian regions shows variation, with region north reporting the best result in the fourth quarter.

The biological cost of harvested fish increased by 4% compared to the fourth quarter of 2013. The cost of feed per kg harvested was slightly down compared the corresponding period last year as a result of reduced feed prices.

As in previous periods, sea lice mitigation costs have been high for the harvested generation.

The higher sea temperatures have resulted in a challenging sea lice situation, with more treatments and significant treatment losses, the company said.

The cost of medication per kg harvested was 70% higher in the fourth quarter of 2014 than in the corresponding period in 2013, while the estimated exceptional cost related to sea lice mitigation amounted to NOK 117m, compared to NOK 62m.

Quarterly and year to date exceptional sea lice mitigation costs were NOK 1.67/kg and NOK 1.38/kg harvested respectively (NOK 0.90 and NOK 0.70 respectively).

Non-seawater costs have increased compared to the same period in 2013, due to increased mortality losses mainly as a result of losses during lice treatment. This was partially offset by increased volume.

Exceptional mortality losses amounting to NOK 27m were recognized in the quarter, of which NOK 21m is included in the cost of lice mitigation. Losses from exceptional mortality in the fourth quarter of 2013 were NOK 18m.

There has been no exceptional mortality related to AGD in 2013 or 2014, but AGD has been treated for in the period.

AGD mitigation efforts have resulted in increased cost for salmon harvested in 2014 of NOK 0.65/kg in the most exposed region.

Canadian results hit by lower prices

In Canada, increased supply from Chile suppressed prices and saw the company’s Q4 ebit decline 56.89% y-o-y, to NOK 25m. Meanwhile, harvest volumes were 6,819t, up from 5,726t in Q4 of 2013.

The reduction in profitability is due to a reduction in the reference price in market currency of 26% compared to the fourth quarter of 2013.

The cost per kg harvested has been reduced from 2013, however.

“The market for fresh whole Canadian salmon has been challenging in the period, due to a significant increase in the supply of salmon of both North American and Chilean origin,” said Marine Harvest.

After a dip in supply in 2013 and the first half of 2014, the supply of North American salmon started to increase in the third quarter.

In the fourth quarter the increase was more than 10% compared to the same period in 2013.

The increase in the supply of Chilean salmon was approximately 19% in the period compared to 2013. “The increase in salmon supply in the US market has therefore been substantial compared to the same period one year ago, which is the driver behind the low market price in the period,” the company said.

Compared to the fourth quarter of 2013, the reference price in market currency was down by 26%.

On a positive note, biological costs for salmon harvested in the period decreased by 8% compared to the fourth quarter of 2013. There was no exceptional mortality recognized in the fourth quarter of 2013 and 2014.

Chile turns back to US

Operational ebit for salmon of Chilean origin amounted to NOK 6m in the period, down 82.82% y-o-y.

Harvested volume was 16,602t in the fourth quarter, compared to 14,136t.

“The significant reduction in market prices compared to the fourth quarter of 2013 was only partially mitigated by favorable cost development, good market performance and volume increase,” said Marine Harvest.

The Urner Barry reference price for Chilean salmon was down by 13% compared to the fourth quarter of 2013 due to increased supply in the North American market.

“Even if all European salmon origins, with the exception of Faroese salmon currently is banned in Russia, the lack of customer guarantees and the sudden reduction in the Russian purchasing power distorted Chilean sales to this market in the period,” said Marine Harvest.

The resulting increase in salmon supply in the US market has been substantial compared to the same period one year ago, which is the driver behind the low market price in the quarter, the company said.

Cost wise, Marine Harvest said its Chilean operations performs well as a result of good farming practices and changes in the feeding regime, “but the biological development in Chile remains a concern”.

The sea lice load at the end of the quarter was higher than at the corresponding time in 2013, the company said.

Compared to the fourth quarter of 2013, the biological cost has been reduced by 10%.

Improvements in the feed conversion ratio have mitigated the effect of increasing feed prices, while good seawater growth has contributed to reduce other seawater cost per kg. Lice mitigation costs have remained stable compared to the same period last year, the company said.

In the fourth quarter, the full cost per kg for a head on gutted salmon packed in a standard box was approximately $4.50/kg, which is up by $0.20/kg from the third quarter in 2014.

The company has significant plans for expansion in Chile, with its deals for the assets of Acuinova Chile, formerly part of Pescanova, as well as an agreement to merge with Aquachile.

The deal for Acuinova Chile represents a capacity to produce about 40 000t of salmon gutted weight per year.

This asset purchase includes a hatchery, a smolt facility, 36 seawater licenses and a primary and secondary processing facility, all located in Chile’s region XI. The biomass included in the deal is expected to generate a harvest volume of about 15,000t gutted weight in 2015, Marine Harvest said.

The deal to merge Marine Harvest’s Chilean business with Aquachile is considered transformative for the sector.

On Jan. 19, Marine Harvest announced the plan, which will mean the surviving entity will be Aquachile, which will continue to be listed on the Santiago Stock Exchange on a stand-alone basis.

Upon completion of the merger, Marine Harvest will own 42.8% of the combined entity. In conjunction with the merger, Marine Harvest has agreed on a standstill position of its ownership in Aquachile until June 15, 2016. From June 15, 2016 until June 15, 2017, Marine Harvest will have the option to acquire further shares in Aquachile through a tender offer that at a minimum will give Marine Harvest an ownership interest of 55%.

Improved results in Faroe Islands, Ireland

Salmon of Faroese origin achieved an operational ebit of NOK 44m in the fourth quarter, up from NOK 27m.

Harvest volume in the fourth quarter was 3,314t tons, compared to 1,874t .

“We have shipped Faroese salmon to Russia in the period,” Marine Harvest said.

Biomass costs have increased due to higher feed cost. In addition, a new third party processing agreement has contributed to increased processing costs, the company said.

“Due to the limited number of sites in operation, we have extended periods without harvesting on the Faroe Islands. There will, as a result, be no harvest of salmon of Faroese origin in the first three quarters of 2015,” the company said.

Results in Ireland were also improved.

Salmon of Irish origin achieved an operational ebit of NOK 9m in the fourth quarter, compared to a loss of NOK 36m in the same quarter of 2013.

Achieved prices were 5% higher in the fourth quarter of 2014 than in the same period in 2013, with harvest volume at 2,069t, up from 1,345t.Screen Shot 2015-02-04 at 09.02.01

Exceptional mortality losses in the amount of NOK 8m were recognized in the period. The losses were due to an algal bloom, resulting in reduced oxygen levels, and pancreatic disease. AGD management with freshwater treatment continues successfully, Marine Harvest said.

Upstream, Marine Harvest reported a strong quarter from its startup feed operation and is mulling building more capacity outside of Norway.

Closer to the market, the company’s Marine Harvest Value-Added Processing (VAP) and Morpol divisions, which will be merged into Marine Harvest Consumer Products from Q1 of 2015, also reported better results y-o-y. VAP Europe returned to the black and Morpol saw profits increase
http://www.seafoodnews.com/Story/962171/Marine-Harvest-has-strong-year-with-3-point-38-billion-turnover-and-32-percent-jump-in-earnings

 

Environment/Science

Handheld sensor allows rapid detection of fish fraud
FIS.COM -February 05, 2015
Scientists at the University of South Florida’s College of Marine Science have developed a handheld sensor capable of debunking fraudulent seafood species claims, helping to ensure that consumers are getting what they pay for.
http://fis.com/fis/worldnews/worldnews.asp?l=e&country=0&special=&monthyear=&day=&id=74408&ndb=1&df=0

FYI’s

Alaska Symphony of Seafood Entries Range From Smoked Salmon To Pet Snacks
Fishermen News – February 4, 2015
Cold smoked sockeye salmon candy and salmon chips from 2014 grand prize winner Tilgner’s Specialized Smoked Seafood are among the 17 entries in the 2015 Alaska Symphony of Seafood competition.
http://fnonlinenews.blogspot.com/2015/02/alaska-symphony-of-seafood-entries.html

NOAA Seeks Comments on Crab Rationalization Program
Targeted News Service 2015-02-04
WASHINGTON, Feb. 4 — In a proposed rule, the U.S. National Oceanic & Atmospheric Administration has requested comments on an amendment that would establish a regulatory process for the removal of Pacific cod sideboard limits in the Gulf of Alaska under the Crab Rationalization Program affecting the hook-and-line catcher/processor sectors.
http://targetednews.com/display_story.php?s_id=1189676

NOAA Issues Temporary Fishing Closure for Atka Mackerel in Bering Sea and Aleutian Islands Management Area
Targeted News Service 2015-02-04
WASHINGTON, Feb. 4 — The U.S. National Oceanic & Atmospheric Administration published the following rule in the Federal Register:
http://targetednews.com/display_story.php?s_id=1189744

 

Ann Owens
Pacific Seafood Processors Association
Office Manager
1900 W Emerson Place Suite 205, Seattle, WA 98119
Phone: 206.281.1667
E-mail: pspafish@gmail.com; Website: www.pspafish.net
Our office days/hours are Monday-Friday
8:00 A.M. – 5:00 P.M.

In accordance with Title 17 U.S.C. Section 107, any copyrighted work in this message is distributed under fair use without profit or payment to those who have expressed a prior interest in receiving this information for non-profit research and educational purposes only. *Inclusion of a news article, report, or other document in this email does not imply PSPA support or endorsement of the information or opinion expressed in the document.

February 5, 2015