(SitNews) - Values for Alaska salmon permits have remained stagnant all year, except for two regions, and costs for halibut quota shares have plummeted. 

For salmon permits, an off kilter fishery that came in 30 percent below an already grim harvest forecast kept a downward press on permit values. The preseason projection called for a salmon catch of 147 million this year; the total take was closer to 114 million.

“All of these salmon fisheries in the Gulf, both gillnet and seine permits, had a lousy year. And we see that in the lackluster permit market,” said  Doug Bowen of Alaska Boats and Permits  in Homer. 

Further west, Bristol Bay with its back to back record breakers is an exception and permit prices there reflect increased buying interest. A scan of multiple broker listings show Bay drift gillnet permits at $165,000 compared to the $145,000 range before the fishing season. 

Salmon fishermen at Bristol Bay pocketed a record $280 million at the docks, not including post season bonuses, on a catch of 35 million sockeyes.

Bowen said more fishermen from regions of repeated poor salmon runs are eyeing Bristol Bay. His company has nearly 30 listings of Cook Inlet drift permit holders who want to exit that fishery.    

“Folks are wanting to move out of the Inlet, which had another terrible year and go to Bristol Bay and people want to move from Southeast to the Bay,” he said.     

Drift permits for False Pass (Area M) on the Alaska Peninsula also are increasing in value after several years of good fishing.  

“We recently sold one for $175,000 which is $10,000 more than what the Bay permits are selling for,” Bowen said.  

Elsewhere permit prices remain stalled. Prince William Sound seines have stayed at $165,000 and drift gillnet permits at around $150,000. At Cook Inlet, drift permits are in the $30,000 to $50,000 range. Kodiak seine permits have ticked up a bit to $28,000. For Southeast, seine permits are in the $210,000 to $250,000 range and drift gillnets at or slightly above $85,000.

Further north, Norton Sound and Kotzebue again set records in their salmon fisheries, but permit transactions in those regions operate differently.

“There aren’t very many of them and not many change hands. When they do, a lot of those folks know each other and it’s word of mouth. So we’re not that involved in those permit markets,” Bowen said.

Higher salmon prices should show a big boost in the value of this year’s catch but it won’t make up for the shortfall in fish.

“It’s a matter of price and production,” Bowen said. “If you’re limited on how much you can harvest, that great price is not going to save the day.” 

Catch share values plummet:

High prices for halibut quota shares that one year ago were in the nose bleed area have now taken a nose dive. 

“Negative news about recruitment into the fishery and more bad news about lower exvessel prices – that was enough to turn that IFQ (Individual Fishing Quota) market downward. There are some stiff headwinds for sure,” said  Alaska Boats and Permits  Doug Bowen in Homer. 

Multiple broker listings show quota shares in Southeast Alaska (Area 2C) that for several years topped $70 per pound are now 20 to 25 percent less, in the $48 to $59 range. 

For the Central Gulf (Area 3A), halibut shares have dropped 30 to 40 percent to $40 to $50 per pound. The value for halibut quota in the Western Gulf (Area 3B) is down 50 percent to under $30 dollars per pound.  

Surveys of the stocks in 2017 showed a lack of young halibut recruiting into the fishery and managers pushed for drastic cuts for future fisheries.  

Then last fall, halibut prices dropped by $2 a pound at the docks and boats sometimes couldn’t even find buyers for their fish. Another broadside came from seven million pounds of cheaper Atlantic halibut from eastern Canada displacing Alaska’s fish in traditional U.S. markets.     

The industry will get its first look at potential catches for next year at the International Pacific Halibut Commission meeting  set for Nov. 27-28 in Seattle. 

 Chilling assists: 

The fisherman is the first link in the cold chain and RSW (refrigerated seawater) is their go to system. At Bristol Bay (and elsewhere), processors are now requiring that the salmon they buy from fishermen must be chilled, and they are paying nice bonuses for the better quality fish. The chilling rate for Bay salmon jumped from 24 percent a decade ago to 73 percent in 2017, and it will surely be higher for this season. 

Several RSW buying assists are being offered as more Bristol Bay boats acquire the chilling technology.

“The gold standard for Bristol Bay used to be 7.5 ton hydraulic, that’s what everyone wanted. It’s really changed a lot. Now RSW systems go from three ton electric to 12 ton diesel drive,” said Kurt Ness, director of operations and co-owner of Seattle-based Integrated Marine Systems (IMS). 

One ton of refrigeration will chill 12,000 pounds of water and fish one degree in one hour.  

IMS has developed a new system for smaller vessels, some dealing with RSW for the first time. 

“Some boats don’t have the hydraulic power to power a traditional unit or don’t have the space for a larger diesel drive,” Ness explained. “So we came up with a three ton and five ton electric that can be run by a single faced generator so the footprint is much smaller. It’s designed for boats that pack in the 5,000 to 8,000 pound range.” 

Costs for an RSW system can range from $15,000 for small electric units up to $44,000 for large diesel drives. 

“There are a lot of other costs involved too,” Ness said. “There could be flush decking, insulation, maybe some hydraulic upgrades. You could easily double that just in terms of the actual installation itself.”

Despite the initial hit to the pocketbook, “practically to the person, everyone admits RSW is the best thing they ever did,” said Bristol Bay veteran Buck Gibbons. With the quality incentives that many processors offer the difference can be upwards of 40 to 50 cents per pound.  Last year, those who sold dry fish received around $1.25.  Those who did everything right received $1.55 - $1.61.  When you run that through 100,000 to 200,000 pounds, it adds up quick.” 

To help defray the RSW cost, IMS is offering a $1,500 discount for Bristol Bay fishermen “for retrofits, new builds and everything in between” through March 1. 

The Bristol Bay Regional Seafood Development Association (BBRSDA), funded and operated by fishermen, also negotiated a bulk RSW purchase with Pacific West Refrigeration for 7.5 ton units for resale for $20,500, said executive director Andy Wink. Contact 907-677-2371 or email info@bbrsda.com.

The Bristol Bay Borough also is offering a tax credit to fishermen in the Naknek-Kvichak District who install a chilling system by the end of this year. Participants will be eligible for a $1,500 rebate from the three percent fish landing tax paid to the Borough.

The Bristol Bay Economic Development Corporation (BBEDC) also is offering a limited number of free RSW systems to qualified residents.

 ASMI Axed: 

The budget has been zeroed out for the state run Alaska Seafood Marketing Institute. 

“With zero state general funds, the fiscal year 2019 budget was reduced by just over $1 million. Every program took a reduction this year,” said Becky Monagle, finance director for  ASMI at an “All Hands” meeting last week in Anchorage.   

For FY 2018, ASMI spent $16 million in marketing promotions and outreach at home and abroad. That was funded by $10.8 million from fisheries related taxes, $4.2 million from the federal government and $1 million from the state’s general fund.

Compare that to the budget of one of Alaska’s biggest competitors, Norway. That country imposes a small tax on its seafood exports that generates over $50 million a year to fund sales and marketing.  

As with barrels of oil, all Alaskans benefit when the price of our seafood increases. The added tax revenues end up in state coffers to be distributed at the whim of the legislature.

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