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Thursday, February 4, 2021

Alaska UniSea Reopens After COVID-19 Outbreak Forces Month-Long Shutdown KUCB by Hope McKenney - February 2, 2021 Unalaska's largest fish processing plant reopened Monday after a COVID-19 outbreak forced it to shut down for almost a month. Outlook poor for 2021 Copper River, Upper Cook Inlet sockeye runs in Alaska Seafood Source by Brian Hagenbuch - February 3, 2021 Sockeye salmon forecasts for both the Copper River and the Upper Cook Inlet came in well below historical averages for the upcoming season, a blow to fisheries already reeling from poor runs and pandemic-related losses last season. National US retailers notched record seafood sales in 2020 Seafood Source by Christine Blank - February 2, 2021 U.S. retailers posted record seafood sales across the fresh, frozen, and shelf-stable categories, according to new data presented at the National Fisheries Institute’s Global Seafood Marketing Conference on 1 February. FYI's Sitka crewmember training program accepting applicants Cordova Times - February 2, 2021 Applications are open for a crewmember training program based in Sitka to help teach young people about commercial fishing opportunities and the industry’s importance to coastal community economies. Coast Guard vessel exams coming to Cordova in April Cordova Times - February 3, 2021 Free no-fault dockside examinations are being offered in Cordova from April 16-24 by commercial fishing vessel examiners from the U.S. Coast Guard Marine Safety Unit Valdez. Opinion Opinion: The Winding Glass: Supply Disruption a Possible Major Problem for Seafood Industry in 2021 SeafoodNews by John Sackton - January 28, 2021 [The winding glass is an opinion and commentary column by John Sackton, Founder of SeafoodNews] Despite the pandemic and the uncontrolled COVID outbreak in the U.S., 2020 was a banner year for the seafood industry. The spectacular growth in retail seafood sales compensated for the dramatic loss of foodservice opportunities. According to data presented at NFI’s Global Seafood Marketing Conference, overall seafood sales to retail and foodservice combined grew around 7% last year. This strength is continuing into 2021. Early indications from retailers suggest that the strength of seafood sales is continuing after the holidays. Many are reporting strong year-over-year gains in weekly sales. The success last year was partly based on the ability of the industry to continue production and avoid shutdowns that plagued the meat industry at the start of the pandemic. Despite fears of supply chain disruption in March, April and May, overall seafood imports to the U.S. rose 3.5%, while retail focused major species imports rose 20%. Through November, shrimp imports are up 19%, salmon is up 4%, canned tuna is up 53%, tilapia is up 13%, catfish and pangasius are up 19%, and crab overall is up 13%.

Source: Urner Barry Census Import Data Import volumes for items that are primarily foodservice tended to decline, with most falling below their 2019 levels. For example, frozen tuna was -4%, Alaska pollock was down -7%, and haddock was down -18%. Despite favorable outcome last year, there are several warning signs that 2021 might not be simply a continuation of good news for the industry. As anyone following COVID knows there has been a resurgence not simply in the U.S., but in the UK, and Europe as well, leading to further shutdowns and disruptions. This has had a huge impact on the start of the Alaska pollock season. Three of the major plants, Trident Akutan, Unisea in Dutch Harbor, and Alyeska in Dutch Harbor, are currently shut down due to COVID outbreaks among plant employees. Last year Unisea brought in their workforce prior to the outbreak, and then kept them in Unalaska right through the B season. But after a Christmas break, despite quarantine, new infections appeared, and now the plant is shut down while the company tries to test and control the outbreak. The situation is worse in Akutan. Trident’s plant is only reachable by boat or float plane from Dutch Harbor. Yesterday KUCB reported that 20% of the plants' 700 current workers had tested positive, with only 50% of the workforce tested. At a news conference, Alaska’s state epidemiologist Dr. Joe McLaughlin said the infections were on an upward trajectory and he said it’s “going to go on for a while.” Trident has held off bringing on additional employees who are ending quarantine in Anchorage. This is already causing catcher vessels to shift to Peter Pan and Silver Bay plants in King Cove and False Pass. Also, as the roe season is time critical, delays into the middle of February have the potential to impact the quality and quantity of roe, hitting the profitability of the industry. In Chile, salmon plants have also been shut down due to the virus, with politicians pushing for 14 day shutdowns due to the risk to local communities, and the plants trying for less extensive shutdowns based on a testing regime. Until seafood workers can be largely vaccinated as part of the essential workforce, these disruptions are likely to continue. Such vaccinations may not be complete until June. Besides direct plant outbreaks, there are other major disruptions in the shipment of Russian pollock and cod to China, and the difficulties of getting container shipments out of China. Most US cod is twice frozen Barents Sea cod shipped to China for reprocessing. An outbreak in Dalian, one of the two primary seafood processing centers in China, has led to many plants shutting down early for the Chinese New Year which is in mid-February this year. This city-wide lockdown also has disrupted the port and shipping operations. In general shipping out of China is in a complete meltdown right now, due to a perfect storm of lack of shipping capacity, workers being out of work, and backups in unloading in ports like LA, also due to Covid outbreaks. The result has been that there is a huge spike in shipping costs for reefers between China and the US, with spot prices soaring to $10,000 to even $14,000 per container. The shipping industry was caught flat-footed after slashing capacity at the outbreak of the pandemic, and they have not yet caught up. Furthermore, dry goods shipments can generally be booked farther in advance on long term contracts, crowding out space for frozen foods. The Chinese have also slowed down drastically Russian pollock imports, again due to a very tight inspection protocol. This has left some Russian pollock producers in limbo at the start of the A season, with no easy way to get H&G product processed. None of these disruptions are impacting seafood sales for Lent. These shipments have by and large already been taken care of and are in freezers or on route. The disruptions may begin to appear in April May and June, just as there is optimism about the reopening of some foodservice venues. Last summer we saw an uptick in foodservice sales as virus cases fell and local travel picked up during the summer. This year, that is likely to be even more pronounced as the vaccine rollout gives people more confidence to return to prior habits like dining out. But the confluence of shipping and production disruptions this winter, plus an improving demand in the spring, may put strong upward pressure on some product pricing. Foodservice buyers are not in an financial position to absorb higher food costs. They will be focused on reintroducing themselves to customers, and they will be operating in an economic environment where there is a top tier recovery, and a middle tier recession. McDonald’s highlighted this in an investor announcement today, saying that they had already seen an uptick in sales due to the renewed stimulus, but they cautioned that the overall economic environment was very weak, and they expected their customers to be extremely value focused. Some seafood sectors can survive selling only into the top tier of the economy. But the bulk of our products, including whitefish, shrimp, salmon all depend on a broad and deep demand across a large segment of the population. High prices and supply disruption at the same time as these consumers are mired in loss of income and poor economic situations is not a recipe for continued growth. 2020 was a difficult year because so much was unknown. 2021 may surprise in the opposite way, where the ability to execute a program at a proper price level is thrown into question by events beyond our control.

Pacific Seafood Processors Association 1900 W Emerson Place Suite 205, Seattle, WA 98119 Phone: 206.281.1667 E-mail:; Website: 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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