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Friday, August 14, 2020

*********************************** Please Help Hungry Families eat more seafood: PSPA and APA have a joint venture underway to help feed hungry families, children, and communities more seafood in 2020. We realize that in this age of COVID-19 all of us in the seafood industry are navigating challenging times. Even so, there are friends and neighbors in our nation that have it even worse than we do. Food banks are struggling to keep up with demands to feed hungry people protein and seafood is largely absent from their menus. SeaShare is a nonprofit organization that was established 25 years ago to help us maximize the results of our collective donations and we’ve once again partnered with them to get food to people in need. PSPA and APA have worked with others to donate over one million pounds of high protein seafood over the last 3 months, but the need remains. We know there is more seafood available for hungry families if we can raise the funds needed to process and distribute to food banks. PSPA and APA are asking our friends, colleagues, and associates to consider giving during this time of incredible need. We have set up a live donation page at https://www.seashare.org/donate/pspa-apa-donate. Please make a donation to help. Thank you. ***********************************

Alaska PWS harvest nears 19M salmon Wild stocks of humpies are performing above average, while hatchery harvests lag Cordova Times by Margaret Bauman - August 13, 2020 Purse seine and drift gillnet harvests of salmon continue in earnest this week in Prince William Sound, where the overall harvest has jumped from 11.2 million to 20.5 million salmon in a week, including some 17.6 million humpies. https://www.thecordovatimes.com/2020/08/13/pws-harvest-nears-19m-salmon/ New COVID-19 patients include 12 seafood industry workers Statewide number of Alaskans infected nears 4,000, nonresident total at 787 Cordova Times by Margaret Bauman - August 13, 2020 Ninety-five additional cases of COVID-19 reported by state health officials on Thursday, Aug. 13 include 82 residents of 22 communities, plus 13 nonresidents, mostly in the seafood industry and within the Kodiak Island Borough. https://www.thecordovatimes.com/2020/08/13/new-covid-19-patients-include-12-seafood-industry-workers/ Seafood-related Cases of COVID-19 in Alaska Drops to 9.9% of Total 4,655 Cumulative Cases SeafoodNews.com by Peggy Parker - August 13, 2020 Since record-breaking daily counts of coronavirus in July, Alaska’s count has dropped to an average of 60 cases per day in the first 12 days of August. The daily average in the last 12 days of July was about 100. The non-resident case count now numbers 774, 461 of which are seafood related. Seafood-related cases are 9.9% of all positive cases reported in the state as of August 11, a percentage that has dropped from a high of 11.5% on July 21. Current active cases in AK number 2,674, or about two-thirds of all positives since the virus arrived in the state. There are currently 31 hospitalizations, 6 in ICU and 3 of whom are on ventilators. Total deaths remain at 27. Statewide hospital capacities are still good with nearly 600 beds available. There are another 75 ICU beds available, and over 260 ventilators not currently being used. “Our economy has been put under tremendous stress as a result of restrictions, slowdowns, whether it is tourism, cruiseships, oil, our small mom and pop operations, restaurants, bars, stores, etc. all are under incredible pressure,” Governor Dunleavy said in his Tuesday address to the state. During the Q&A section at the end of the presentations by Dunleavy’s medical and economic leaders, reporters asked the governor several questions about why a state or regional mandate for wearing masks wasn’t made. The state is planning to open schools later this month to a combination of in-person and remote learning, leaving the decisions on a variety of protocols up to each district, with a guidance document — but no mandates — from the state. The issues of masks is being treated in much the same way, with Dunleavy repeating that municipalities across the state can determine for themselves whether a mask mandate should be required or not. https://www.seafoodnews.com/Story/1178231/Seafood-related-Cases-of-COVID-19-in-Alaska-Drops-to-9-point-9-percent-of-Total-4655-Cumulative-Cases Environment/Science Biden voices opposition to Pebble Mine Seafood Source by Brian Hagenbuch - August 11, 2020 Democratic presidential candidate Joe Biden said over the weekend that he would oppose the proposed Pebble Mine in Bristol Bay, Alaska, if he wins the November election. https://www.seafoodsource.com/news/environment-sustainability/biden-voices-opposition-to-pebble-mine Alaskans Rally To Save The Alaska SeaLife Center KUCB by Hope McKenney - August 12, 2020 Local residents are rallying to save the Alaska SeaLife Center, the state's only marine mammal rescue center and a hub for scientific research. https://www.kucb.org/post/unalaskans-rally-save-alaska-sealife-center Federal Register Fisheries of the Exclusive Economic Zone Off Alaska; In Season Adjustment to the 2020 Gulf of Alaska Pollock Seasonal Apportionments A Rule by the National Oceanic and Atmospheric Administration on 08/14/2020 NMFS is adjusting the 2020 C seasonal apportionments of the total allowable catch (TAC) for pollock in the Gulf of Alaska (GOA) by re-apportioning unharvested pollock TAC in Statistical Area 630 of the GOA. This action is necessary to provide opportunity for harvest of the 2020 pollock TAC, consistent with the goals and objectives of the Fishery Management Plan for Groundfish of the Gulf of Alaska. https://www.federalregister.gov/documents/2020/08/14/2020-17846/fisheries-of-the-exclusive-economic-zone-off-alaska-in-season-adjustment-to-the-2020-gulf-of-alaska North Pacific Fishery Management Council; Public Meeting A Notice by the National Oceanic and Atmospheric Administration on 08/14/2020 The North Pacific Fishery Management Council (Council) Scientific and Statistical Committee Subgroup (SSC Subgroup) will be held on August 28, 2020. https://www.federalregister.gov/documents/2020/08/14/2020-17871/north-pacific-fishery-management-council-public-meeting FYI’s Ravn 'Hopes' To Relaunch Service To Rural Hubs In Mid-September KUCB by Hope McKenney - August 13, 2020 The company that bought Ravn's core assets initially hoped to relaunch operations around this time, but the new owners now say that they hope to resume flying in another month, in mid-September. https://www.kucb.org/post/ravn-hopes-relaunch-service-rural-hubs-mid-september Opinion Commentary: Keeping Alaska’s seafood supply chain intact FreightWaves by Darren Prokop - August 11, 2020 The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates. Why is gasoline more expensive in oil-rich Alaska than in most of the Lower 48? Because Alaska ships its crude oil out-of-state without refining it. Other states have large refineries possessing economies of scale that Alaska cannot match. A similar tale applies to Alaska seafood. Why does frozen Alaska salmon, destined for retail markets in the Lower 48, travel on ocean vessels to China beforehand? https://www.freightwaves.com/news/commentary-keeping-alaskas-seafood-supply-chain-intact Op-Ed: The Trump administration pushes Bristol Bay closer to disaster Los Angeles Times by Tim Palmer and Char Miller - August 12, 2020 Think elk by the thousands grazing the grasslands in California’s Central Valley before the Gold Rush. Think 60 million buffalo thundering across the Great Plains. Think of the Columbia River when 16 million salmon finned their way upstream to spawn, now reduced to imperiled species. https://www.latimes.com/opinion/story/2020-08-12/bristol-bay-alaska-army-corps-of-engineers-salmon-northern-dynasty The Winding Glass: 35% of Restaurant Purchasing Evaporates in 2020; Where Does That Leave Us? SeafoodNews by John Sackton - August 12, 2020 [The Winding Glass is a commentary and opinion column by John Sackton, Founder of SeafoodNews] Like most of us individually, the seafood industry has adjusted to a new normal during this pandemic. However, despite hoping to return to where we were last year, it is increasingly unlikely that will happen even with a vaccine in 2021. Personally, and on an industry level, we have to confront that we are in a new world, and there is likely going to be a multi-year period of adjustment. Datassential estimates that total foodservice operator buying from purveyors and for services will be 35% lower in 2020 than their initial estimate based on last year. In real terms it means that the fine dining segment will spend $1.3 billion less; casual dining will spend $17.1 billion less, hotel and lodging $8 billion less, and college dining $4.3 billion less. In total spending on purchases of supplies and services across all segments will drop from $206.8 billion estimated at the beginning of this year to $152.7 billion, a decrease of 35.4%. This is not specific to the seafood industry, but it lets us see the magnitude of what is happening. It supports the expectation in the industry that as many as 1/3 of U.S. restaurants may close by the end of this year. For seafood sellers, retail cannot make this up, either in terms of volume nor value. A key component of foodservice sales is delivering the highest quality and most sought after seafood items to restaurant operators and chefs who will pay for them. This supports things like wild Mexican shrimp, fresh tuna, halibut, sockeye salmon, lobster and Chilean sea bass etc. Businesses have been built on supplying these high-quality items, and the ability to maintain consistent supply and availability has led to long term relationships with customers. What happens when a significant portion of them disappear? The net result is lower demand and lower prices. This ripples back to producers, as we can clearly see in sockeye salmon prices in Bristol Bay this summer, down 50% from last year. Although we saw a bump up in many seafood prices in May and June as it appeared foodservice would recover, that has largely reversed as the larger oversupply picture has emerged. So salmon, both wild and farmed, shrimp, cod, fresh halibut, all have reversed the rise in prices seen in May and June. These trends are likely to continue because we have not yet seen the full economic hit from the pandemic. This is because from April to July, huge amounts of stimulus actually protected American’s spending power, and also provided some help to many businesses. Now that support during the pandemic appears to be evaporating, at least for a month or two. If this does not reverse, the economic numbers in August and September will be dire. Finally, as we are learning more about the pandemic, it is not a one-time hit and then recovery, but rather a process of fighting flareups that keep people at home and reinforce changes in spending patterns. As of August, Datassential reports 47% of Americans will not eat in a restaurant, period. Until there is either a vaccine or a long-term reduction in infections, this behavior is not likely to change. So that leaves many seafood businesses that focused on foodservice fighting for sales in new areas such as home delivery, and direct to consumer sales. This will be a low margin business to start. Similar to the experience of high-tech companies developing software, the key will be first to establish market share and a market presence; only when that is accomplished can attention turn to building margins. Right now, the focus has to be on spending what it takes to grow direct sales volume. An informal survey of some of the companies making this attempt shows free shipping for a minimum order size is a must. Amazon has trained consumers to expect the price of shipping to be included in the sale price, and seafood companies have to follow suit. Because shipping is expensive, many of the frozen sellers have minimum order sizes of $99 or $200 to include shipping in the price. This gives frozen sellers an advantage over fresh sellers, who cannot ship higher volumes. It costs just as much to 2-day ship 4 lbs of fresh seafood with FedEx as it does to ship 10 or 15 lbs of frozen seafood. Fresh seafood direct sales are mostly for same day or next day consumption, making it more difficult for them to bear the full shipping cost. One fresh supplier tells their customers to freeze half of what they buy, so they can take advantage of free shipping. With a two-day delivery window, this means what will be frozen is not in peak condition. In this case, frozen is clearly preferable from a quality and usability standpoint. The other issue is marketing. Most of the marketing for direct sales has to be done on social media or online. This is not a venue that many seafood companies are familiar with. It also is expensive to pay for the direct to seafood consumer advertising that is necessary to grow volume. The payoff is when a business begins to establish a repeat customer who will make a return purchase every 4 or 6 weeks. There is a segment of high-end seafood users in this country who will pay to get monthly or bi-monthly deliveries of seafood. Tapping into this market is key to build volumes to survive in the direct sale or home delivery market. Some distributors are building out in their local area. Many are not trying for national sales, but instead serve a region with their own delivery, or ship within a specific set of zip codes. This is not a one size fits all business. There is room within various metro areas for several well-established direct seafood shippers. Those currently investing in this area are protecting themselves for the future. Will restaurants come back? They will because prepared food is an essential need. Not everyone has the skill, time or inclination to cook, so there will be a huge market for prepared food into the future. But the concepts and how this is done may change. For example, central kitchens that serve a neighborhood, or small concepts that focus on filling a specific niche in a safe way, all have a future. So does take out, and home catering. Traditional foodservice also has a role, but the problem will be in finding alternatives for sales to make up for the cutbacks and bankruptcies that will occur. The large 100 or 200 person dining room is less likely to bounce back. Retail prepared food takeout has not jumped as much as might be expected. Datassential reports that the total purchasing increase for prepared retail foods has only gone up .3%. This might be because consumers are not seeing grocery prepared foods as that different an experience from before the pandemic, and so they have not become the alternative that buying for home cooking has. It also could be that increased prepared sales are already covered through retail purchases for direct sale, so a survey of new purchases for prepared foods may not pick up all the activity. For the fall, we need to prepare for continued oversupply for many species, a weaker economy, and fierce competition to establish presence in new sales areas for frozen seafood. Yet if we can make the transition, the closer presence to direct consumers can only be positive for our entire industry and help sustain our value. https://www.seafoodnews.com/Story/1178124/The-Winding-Glass-35-percent-of-Restaurant-Purchasing-Evaporates-in-2020-Where-Does-That-Leave-Us

Pacific Seafood Processors Association 1900 W Emerson Place Suite 205, Seattle, WA 98119 Phone: 206.281.1667 E-mail: admin@pspafish.net; 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.

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