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Friday, October 22, 2021

Alaska Seawatch: Sockeye run was strong but kings had low run Homer News by Cristy Fry - October 21, 2021 The Bristol Bay salmon run was well above the 20-year average for yet another year for sockeye, but a poor king salmon run led to closures. https://www.homernews.com/business/seawatch-sockeye-run-was-strong-but-kings-had-low-run/ SeaShare Aid to Food Insecure In Alaska Continues as Pandemic Drags On Fishermen's News - October 20, 2021 Nonprofit Washington-state based social services organization SeaShare says that so far this year, it has given five million servings of high-quality seafood to the needy. Image via SeaShare. https://fishermensnews.com/seashare-aid-to-food-insecure-in-alaska-continues-as-pandemic-drags-on/ Environment/Science Vessels return to Ogden Point with 29 tonnes of plastic garbage scooped from North Pacific Times Colonist by Carla Wilson - October 21, 2021 A prototype system to collect floating plastic in the Great Pacific Garbage Patch has proven its worth by hauling in 29,000 kilograms of plastic material, the environmental organization behind the effort said Wednesday, as vessels returned to Ogden Point from two back-to-back six-week expeditions. https://www.timescolonist.com/news/local/vessels-return-to-ogden-point-with-29-tonnes-of-plastic-garbage-scooped-from-north-pacific-1.24365195 Federal Register Fisheries of the Exclusive Economic Zone Off Alaska; Pollock in Statistical Area 610 in the Gulf of Alaska A Rule by the National Oceanic and Atmospheric Administration on 10/20/2021 NMFS is prohibiting directed fishing for pollock in Statistical Area 610 in the Gulf of Alaska (GOA). This action is necessary to prevent exceeding the annual 2021 total allowable catch of pollock for Statistical Area 610 in the GOA. https://www.federalregister.gov/documents/2021/10/20/2021-22853/fisheries-of-the-exclusive-economic-zone-off-alaska-pollock-in-statistical-area-610-in-the-gulf-of North Pacific Fishery Management Council; Public Meeting A Notice by the National Oceanic and Atmospheric Administration on 10/20/2021 The North Pacific Fishery Management Council (Council) Bering Sea Fishery Ecosystem Plan Local Knowledge, Traditional Knowledge, and Subsistence Taskforce (LKTKS) will be held November 8, 2021 and on November 10, 2021. https://www.federalregister.gov/documents/2021/10/20/2021-22865/north-pacific-fishery-management-council-public-meeting FYI’s Symphony of Seafood Competition Attracts 18 New Products Seafood News by Laine Welch - October 22, 2021 This is Alaska Fish Radio. I’m Laine Welch –Alaska’s biggest seafood competition attracts a lot of entries. More after this – Fish Radio is brought to you by Alaska Boats and Permits in Homer. Marine broker for vessels, permits and IFQs. Online at www.alaskaboat.com The Alaska Seafood Marketing Institute provides digital and print marketing materials to the Alaska seafood industry. Find access to thousands of stunning photos, high quality video footage, and sales tools at www.alaskaseafood.org. The Alaska Symphony of Seafood attracted 18 entries in the competition that has showcased and promoted new products made by major companies and small “Mom and Pops” since 1993. The contest features market-ready products in several categories: retail and food service, salmon and whitefish and new to the line up is a Bristol Bay Choice which is awarded to the best new sockeye product. Products made from Alaska seaweeds also are highlighted, says Riley Smith, deputy director of the Alaska Fisheries Development Foundation, the Symphony host. “We have Alaska Barbecue Sauce from Barnacle Foods with Alaska kelp in it. Premium Aquatics and Seagrove Kelp also entered their ribbon kelp.” Barnacle Foods of Juneau won the Grand prize two years ago for its Bullwhip Kelp Hot Sauce. Another category, Beyond the Plate, features more uses of fishery products. It attracted five entries - “From AlaSkin Dog Treats, Alaska Smoked Sea Salt from Prince William Sound, salmon oils and Deep Blue Sea bath soak by Waterbody of Wrangell.” An expert panel will judge all of the products on November 17 and seafood fans will get to taste them all at a bash at Seattle’s Bell Harbor Conference Center that evening. First place winners and a People’s Choice award will be announced at Pacific Marine Expo’s center stage on November 19. Smith says a special presentation that day also will discuss how to get new products into the marketplace. “We’ll be speaking to how to get a product ready from concept to design and recipes and packaging to market and celebrating the process and the work that goes into creating a new product.” A grand prize winner and products placing second and third will be kept under wraps until the Symphony moves to Juneau for a special soiree in February where another People’s Choice will be announced. Top winners get a free trip to the big Seafood Expo North America in Boston in March where their products will compete nationally. Check out the lineup at Pacific Marine Expo, Nov. 18-20 in Seattle. www.pacificmarineexpo.com Fish Radio is also brought to you by OBI Seafoods, an Alaska corporation proudly supporting Alaska’s coastal communities and the Alaskans who depend on fishing for their livelihoods and culture. Visit www.obiseafoods.com In Kodiak, I’m Laine Welch. https://www.seafoodnews.com/Story/1210842/Symphony-of-Seafood-Competition-Attracts-18-New-Products Editorial/Opinion The Winding Glass: Chuck Bundrant and the End of an Era in Alaska SeafoodNews.com by John Sackton Founder - October 21, 2021 [The Winding Glass is the commentary and opinion column of John Sackton, Founder of SeafoodNews] The passing of Chuck Bundrant this week is a time to reflect on the passing of an era in Alaska. Chuck was a wonderful, humble, fighting man, and many people who knew him far better than I did will be giving tributes. Yet for me, he epitomized the dynamism that made Alaska Fisheries the most successful in the world, and he epitomized a period that is now passing out of memory. He had the 'right stuff'. Just like the test pilots and astronauts who forged a new frontier taking the US into space, so Chuck was the paradigm of the Alaska fisheries entrepreneur. He fought, he dealt, he innovated, he brought in trusted partners, he took risks, and he kept his word. He was equally at home at a fish camp in Dillingham, the bars in Kodiak, fishing on the Bering Sea, in the Board room in Seattle, or meeting customers in Japan or Las Vegas. There are some wonderful books about Chuck’s life. “Catching a Deckload of Dreams” by John van Amerongen is a Trident authorized biography, but it is very true both to the history and to Chuck’s vision of the industry. I did not know Chuck that well, but his single-minded efforts to build Trident intersected with my own career in Alaska a number of times. We bonded over the salmon anti-trust lawsuit. In the 1990s Trident was already a huge player in the salmon industry, selling sockeye primarily to Japan. Their competitors were the large Japanese companies that also owned plants in Alaska, dedicated as sources of supply. When prices collapsed in Bristol Bay just around the time that farmed salmon became a serious competitor, some harvesters banded together in a price-fixing lawsuit charging that the major salmon buyers conspired to hold down prices to fishermen. Like many fisheries lawsuits, the suit quickly evolved into a self-funding juggernaut. By forcing settlements with some of the smaller players for millions of dollars, the plaintiff’s lawyers gained a war chest to take the suit to trial. Many of the original companies named, included some of the Japanese salmon companies, paid to settle. Trident, one of the last holdouts, was offered a very low settlement of $1 million when others had paid as much as $20 million. Chuck turned it down, as he thought settling would be an admission of guilt for something he had never done. Trident and the other remaining industry players faced a damage award that could reach $1 billion if they lost the suit, putting Trident out of business. The trial did not take place until the early 2000s. Chuck spent every day in the Anchorage courtroom, listening to testimony. At that time I had begun writing SeafoodNews, and when I began to investigate the price-fixing charge, it was clear to me that the price fluctuations were driven by normal market issues and were not manipulated. The people bringing the charges did not understand how complex seafood markets worked, nor the risks that salmon buyers took every year. It looked more and more like a lawyer's boondoggle. I wrote from this perspective several times during the trial, and Chuck, who had no hand in these stories, was delighted to see such support for what he knew to be true. The price-fixing suit was denied. Trident recouped a portion of its costs from the settlement fees paid by others. As so often with him, once you became a friend, you were a friend for life. Prior to that, I had been on the opposite side of a major battle of Trident’s. That was the inshore/offshore fight over pollock allocations. During the 1980s, I worked for Jeff Davis and Baader North America, eventually becoming general manager. I was responsible for our sales forecasts, and for overseeing the sales of our machines in North America, including Alaska. Those were boom years. We had developed the Baader 182 that could fillet pollock at 120 fish per minute. Combined with a deep skinner to remove the fat layer, we could produce a fillet that would supplant cod in the breaded sandwich market. Trident was involved in some of the first trials of the 182 in Kodiak, producing deep skinned pollock fillets that they sold to Long John Silver’s. Once deep skinning became viable, there was a race to build factory trawlers to take over pollock quota from the Japanese. Under US law, the Japanese catches of pollock could be stopped only once the resource was fully utilized by Americans. Baader wanted to sell machines to everyone, so we rapidly equipped the factory trawlers owned by Francis Miller and Arctic Alaska, and some of the big surimi factory vessels such as the Golden Alaska, those of Erik Brevik, and of course Kjell Rokke’s boats for American Seafoods. In the late 1980s, Trident began to produce surimi onshore as well as fillets, also with Baader 182’s. There was a huge Olympic race for pollock, and the industry was rapidly being overcapitalized. This led to the multi-year inshore/offshore battle. It came to a head when the pollock fishery was shut down in the Gulf of Alaska before the processing plants could operate even half a year. Everyone realized there had to be some type of allocation of the pollock quota. Yet the offshore boats had been first, and companies like Trident, which were just ramping up their investments in shore-based production, risked being shut out if they couldn't get enough fish to make the shore plants economical. Baader was caught in the middle. Because the offshore group had been our largest customers, we tended to favor the status-quo, which would have limited Trident. The N. Pacific Council finally came up with an allocation that would raise the inshore quota from 35% up to 50%, and would prohibit offshore vessels from the Gulf of Alaska. But the approval was stymied in Washington. So Bundrant and some of the Alaskan fishermen from Kodiak asked for intervention from Senator Ted Stevens, and the basic framework was approved. This didn’t end the race for fish, as within each sector there was no stability, simply increasing effort. Eight years later came the American Fisheries Act. It allowed quota to be allocated to cooperatives or sectors, essentially ending the race for fish. It also set up the CDQ program in Alaska which gave initially 7%, and then 10% of pollock allocations to the six native community organizations representing Western Alaska. And the act required at least 75% American ownership for all pollock vessels, forcing the Norwegian fleet to restructure. The AFA also formalized the split between inshore and offshore quotas, with American Seafoods agreeing to reduce its overall share. The pollock industry has thrived ever since. Another fishery dear to Chuck Bundrant and Trident was the crab fishery. Chuck had started out fishing crab, and made his first real money there. After the collapse of the king crab fishery, he saw the value in snow crab, and under competitive pressure, bought the plant at St. Paul which had never really got operational. This was a huge volume plant for crab, and as the snow crab quotas soared and prices came down, the closeness to the fishing grounds was a big advantage. Trident was now processing both in Akutan and St. Paul. But just as with pollock, there was a severe overcapitalization problem. The king crab season was reduced to less than a week due to the Olympic fishery, and snow crab had become the deadliest fishery in the country as vessels raced to set out pots in icy and unsafe conditions. Because of Trident’s understanding that quotas had to protect processing investment as well as vessel investment, there were years of negotiation over crab rationalization in the Bering Sea. The result was a unique program that provided both processing and harvester quotas, and a requirement that quotas be matched. This meant a harvester had to sell to a company with processing quota. To avoid the situation where the owners of the last remaining processing quota could dictate minimal prices to the last harvesters, an arbitration system was established to set out a fair price formula each season, based on the historical share of revenues (not profits) from the period prior to rationalization. I was hired as the arbitrator by both the processors and the harvesters, to produce the annual non-binding price formula for each of the crab fisheries when the program was approved in 2005. I continued until 2017. There were additional contract arbitrators who could issue legally binding rulings if there were price disputes over the non-binding price formula. This program did not work out as Trident had hoped. It protected access to crab, but at the price of taking away market power. As with other quota systems, the additional value over costs in the fishery flowed to the harvesters. Chuck Bundrant was all about selling fish. He worked hard to get it. He worked hard to buy fairly from fishermen, and had many decade-long relationships with harvesters. And he lived to serve and satisfy Trident’s customers. The key moments for Chuck were when he could buy fish, know the market, and sell it later at a fair profit. This is how his long partnership with ConAgra worked. Before the Bundrants and Chuck’s other partners bought out ConAgra, that company had supplied the financing and capital for the acquisitions from new plants to salmon companies as Trident grew with ConAgra as a 50% partner. ConAgra would finance an expansion in salmon. Chuck would understand and time the market well. And both companies would make money. Rinse and repeat. This continued until Chuck bought out ConAgra, and shortly after that, bought Arctic Alaska's fleet from Tyson. But crab rationalization upended this pattern. The price formula was based on the average historical share of revenues, so that if the wholesale price rose by 20 cents, the effective cost of raw material rose by 18 cents, with that money going back to the harvesters. Processors got the benefit of shared risk, because if the market collapsed, final prices could come down as well. But they lost the ability to play the market, or to invest in sales of the product to get a higher price. This became clear the first year. In 2006 snow crab prices were low and some packers, including Trident and Icicle, sold quickly taking orders that led to a price of around $1.00 back to the harvesters. Other packers, who sold later, did much better, giving a return of around $1.10 simply due to market timing. Harvesters took one company to arbitration, and accused them of paying too little that season. The arbitrator sided with them, and Trident had to pay the difference. Trident’s executives, including Steve Okerlund, the comptroller, were apoplectic. How could anyone tell Trident how to manage their crab business? How could they be trapped in a system where nothing they could do for customers or themselves would make a difference. Whatever happened they would get the industry average. It left a terrible taste. Nevertheless, Trident tried to make the system work. They were extremely cooperative and forthcoming, and did not give up on a system they helped create. They took heroic measures to keep St. Paul operating in ice conditions some years, to help support the fleet and keep crab coming ashore. Though Chuck and Joe Bundrant hated the system and felt what was created was unfair, they never blamed me for its design, and worked for years to try and improve it. Today, prices of crab are so high that all sectors are doing well. The issues in the formula were most pronounced when crab prices were low. Finally, one other comment about Chuck and the impact he had on Trident and Alaska. Even though Trident was just one company, and was in strenuous competition for fish and markets, Chuck was committed to Alaska as a brand. This tradition continues in the company through Joe Bundrant. The final issue we dealt with together was the role of the Marine Stewardship Council in Alaska. During the growth years, Alaska set the gold standard for fisheries management. When the Marine Stewardship council was first formed, they relied on Alaska salmon and then pollock to prove to their target retail customers that they could in fact certify large volume high value fisheries. So it came as a shock when the MSC threatened to pull certification from Alaska salmon because of changes in how they wanted to do their assessments. Alaska supports all its fisheries, and by law the Alaska Seafood Marketing Council cannot exclude any Alaskan fishery. But the MSC wanted to rate salmon fisheries by individual river systems, so for example Bristol Bay sockeye would be certified, but Prince William Sound or Copper River salmon might not be. This caused a fury because it was an example of the tail wagging the dog. Alaska had built up years of salmon fishery management, and had a stellar record, which now this new organization wanted to call into question. Trident wanted to listen to their customers. Companies like Walmart had committed to sustainable seafood programs, and they saw value in the MSC label. But both Trident and their major customers recognized the fragility of a system where the sustainable certification was subject to unreviewed institutional whims. Trident and their customers spearheaded the effort to create a framework for sustainability certifications that eventually became the Global Seafood Sustainability Initiative, and provided a benchmark that almost all major companies now accept. This benchmark allowed Alaska to develop certifications programs to meet the requirements of these customers, and protected the reputation of Alaska salmon in the marketplace. I was proud to write in support of this vision. Chuck was a man of strong opinion and strong feelings, and he wanted what was best for Trident. But he also knew he was part of something larger: the entire Alaskan and North Pacific fishery. He stuck to that vision of a healthy Alaskan fishery even when it would cost Trident money or opportunity. When he had a problem, he worked the problem, he did not crash the system. He worked to make it better. That’s why he is such an example of those who have ‘the right stuff’. To me, his passing marks the end of an era in Alaska. The fishery was built by men like Chuck, Don Giles, Al Burch, Erik Breivik and many others who fought like hell, took risks, and won huge rewards but did not turn their backs on where they came from. Today much of the story of Alaska is being written by private equity. Companies have become so large and valuable that most of them are investor-owned. In a huge mark of success for the CDQ program, some of the investor-owned companies are those owned by the Western Alaska communities, who have parlayed their quota shares into controlling interests in major fishing companies. But private equity is still investment by committee. There is little room for the fish entrepreneur who feels in his gut that the market for roe will explode this year. Instead, it is more of a numbers game. The first investors, like ConAgra, Tyson Foods and others, knew they had to follow the entrepreneurs they partnered with. They recognized they did not understand the industry, or how to make money in Alaska. Today that reliance on deep knowledge gained over decades is absent, except in the family-owned private companies. Chuck has left Trident in good hands. Joe Bundrant is running a different company, one focused on developing new markets, expanding pollock usage, and one that is extraordinarily close to their major customers such as Costco, Walmart, and many others. Trident has some legendary salespeople who would make any fish company proud. But Alaska is facing new challenges. The changing environment is a problem that cannot be solved just in Alaska. Salmon, crab, even pollock are all at risk from forces larger than the state can cope with. The IFQ's in salmon and halibut, while necessary to solve the race for fish, have also created new financial barriers, as now out-of-state investors have to be paid off by new entrants at very high cost, forcing reliance on financial partners. On top of that, the state in recent years has turned its back on its fisheries. This was clear in state support for the Pebble Mine, despite its serious threat to Bristol Bay. It is also clear that the communities in Western Alaska, and along the coast like Kodiak, have lost influence as Anchorage and its suburbs become less Alaskan, less resource-dependent, and more like other Western US cities. We don't know where renewal will come from. But we can look to Chuck Bundrant as a personal model of caring, commitment, determination, and success, and hope that his legacy empowers us, and of course Trident, his company, to meet the next challenges successfully. https://www.seafoodnews.com/Story/1210738/The-Winding-Glass-Chuck-Bundrant-and-the-End-of-an-Era-in-Alaska 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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