Norton Sound Seafood Products Will Purchase Fish, Governor Issues Commercial Fishing Mandate for Summer
KNOM by Davis Hovey - April 28, 2020
Commercial fishing in the Norton Sound region is on track for the summer season, as winter commercial crabbing wraps up in Nome. With added consideration for COVID-19, extra requirements are expected to be put on commercial fishers and processors alike.
Fever pitch: Alaska implements new covid-19 mandates for the fishing industry
National Fishermen by Laine Welch - April 28, 2020
Strict new rules are now in place for Alaska fishermen and their vessels to protect against and prevent the spread of covid-19 during the 2020 salmon season.
Effective April 24, Gov. Mike Dunleavy provided 11 pages of mandates that specifically apply to those who have not “agreed to operate under a fleet-wide plan submitted by a company, association or entity” representing them.
Gulf of Alaska expedition ends with new salmon data
Cordova Times by Margaret Bauman - April 28, 2020
A second Gulf of Alaska expedition aimed at learning more about numbers of salmon that will return to North American rivers has concluded in Victoria, British Columbia, with data gathered by American, Canadian and Russian researchers now to undergo further study.
Marel hosts global fish expo online
Marel - April 24, 2020
Marel opened its Brussels expo stand to the industry this week in an innovative online format. You can’t bring your customers to an expo at the moment, but it turns out you can bring the expo to your customers.
The live, interactive event brought Marel experts together – both in their Icelandic headquarters studio and online in Denmark and Spain – to present their processing solutions to participants from all over the world, and to discuss current trends in the industry.
Opinion: The Winding Glass: Work Together or Hang Separately, It’s That Simple
SeafoodNews.com by John Sackton - April 28, 2020
[The Winding Glass is the opinion and commentary column by John Sackton, Founder of SeafoodNews.]
Two qualities that gives the seafood industry its unique character are being made up of a multitude of diverse companies of all sizes, and having an immense diversity of species and products.
In the U.S. meat industry, four companies control 84% of beef production, 65% of pork production, 53% of poultry, and one dairy co-op and one processor control 30% and 40% respectively of the national milk supply.
Our companies are not large enough to be dominant in this way. With the exception of a few farmed salmon companies and a couple of major whitefish producers, our largest companies have nowhere near this level of dominance within their segments.
Many of our largest companies, like Nissui, Red Chamber, Thai Union, and Cooke all operate with a multitude of independent segments subject to their own market dynamics.
Size and market dominance does not protect from COVID-19 disruption. Just look at the U.S. pork industry. Right now 25% of capacity is sidelined and a ripple effect down the supply chain is causing farmers to consider euthanizing hundreds of thousands of pigs.
Size and vertical integration does provide more financial security to ride out the storm.
But for the seafood industry, in this pandemic we can hang separately, or survive together. It’s that simple.
For successful production, agreement has to exist up and down the supply chain, from harvesters willing to fish, to plant workers being available, and to processors having banking lines of credit, and to customers who want and can afford the product.
Some years there is more agreement than others. Our history includes many strikes by harvesters, lawsuits on price fixing, bankruptcies by processors and a host of other examples that show how turbulent we can be.
To open and sustain fish production, we are battling on multiple fronts. Failure in any one of them will close down sections of our industry, and likely cause a wave of business bankruptcies.
In Eastern Canada, some crab and lobster seasons are being delayed. In both Canada and Alaska, harvesters are working under very restrictive health rules, both voluntarily on the boats, and imposed by government authorities. The result is lower, slower, and more expensive production.
Under normal circumstances, when harvesters face added costs they want extra compensation. This year, the typical fights over the price of fish will lead to us all hanging separately. The first rule is to produce something at a level that pays costs. Then we can fight over added value afterwards. Despite the outside appearance of harvesters and processors constantly fighting, the reality is that most harvesters sell to the same plants year-after-year-after-year. This means that the relationships established are important, and it is these relationships that will ultimately lead to fair value this year, not the normal strike or standoff.
In a time of social isolation, working in a fish plant is crazy. Yet that is exactly what we want plant workers to do. In response, most companies have instituted strong health and safety measures, including isolation of the work force if from outside the area; provisions for masks and protective gear; slower pace of work due to social distancing and unfamiliar gear, and in many cases, higher incentive or hazard pay for working in the plant. Yet all of these actions add up to higher costs and lower productivity. Just as harvesters face higher costs due to added burdens, so do all processors trying to operate. In many areas, processors may not be able to physically take the volumes of fish that could be harvested. There will be many instances of trip limits and weekly allocations.
But without these measures, no processing at all could take place.
Of course we don't produce in a vacuum. 70% of seafood by value goes into the restaurant and foodservice industry. Today, that is a shadow of its former size, and despite openings that are beginning to take place, it is increasingly possible that we will never again see the foodservice landscape we saw in 2019 and before. Whole segments have disappeared, from cruise lines to casinos to amusement parks like Disney. None of these will come roaring back. They will limp back slowly, and some, like cruise lines, may never grow to their former size.
Much of our standard restaurant sales depend on business travel and tourism. These also may not recover for a long time.
Some seafood items are more adaptable to new sales channels than others. Frozen whitefish, for example, has been more resilient than frozen lobster.
Beyond the physical difficulties of getting things back in operation, the next shoe to drop will be the economic hit to American incomes. This is something we have not really felt yet due to the focus on staying at home. It will become apparent as people leave their homes, but find they have no money to spend.
Seafood prices are likely to decline as supplies adjust to the new normal, and with a few exceptions, this may be bumpy. Companies that have higher priced inventory on hand, whether they are traders, producers, importers or national chains, all have to face the financial cost of writing down this inventory if they want to end the cost of financing it. Companies can either hang on to their existing high priced inventory and slowly use it, or do forced selling of this inventory to cut costs. Both actions will contribute to pushing prices down.
So the sales environment, which ultimately drives the decisions of processors, importers, and ultimately harvesters, is going to be very difficult. Again, fighting each other in this situation is as crazy as it sounds. All of us need the maximum flexibility to simply get through a production season.
This year is all about survival. Anything that takes away from that focus raises the chances of failure, and that is not something many companies can afford.
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