Global Fish Markets

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Global Fish Markets

• 1. Traditional Salmon Structure Alaska
• a. Harvester Sells to Local Cannery
• b. Cannery Pre-sells Pack
• c. Cannery Stops Buying Fish
• When Pack is Complete
• d. Cannery Sells Pack
• e. Cannery May Speculate - buy
• more fish pack more
• banking on uptick in price

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Global Fish Markets

• Post-Statehood Salmon Structure Alaska
• 1. Cannery Sells Product to Distributors
• a. Dont Get Paid until Final Sale
• b. Similar Products Compete - lowering price
• c. Sellers Market, Buyers Restricted in Volume
• 2. Little Feedback from Customers to Cannery
• 3. Product Warehoused for Months
• 4. Little Provision for Fresh / Frozen Product

3
Global Fish Markets

• Modern Structure
• 1. Harvester Sells to Local Cannery
• 2. Cannery Chooses Optimal Product Form
• based on Web Info re Customer Needs
• 3. Cannery Sells Product at Optimal Price
• Product Form Depending on Market
• 4. Cannery Distributes Products

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Global Fish Markets

• 1. Pollock
• a. Harvesting .20 / lb
• b. HG .25 / lb includes losses
• c. Filleting .25 / lb includes losses
• 2. Buyers Choice
• Costs HG at gt.45 or Fillet at .70
• Offers .50 for HG and .78 for Fillet
• 3. Better Deal for Cannery take .50 for HG.

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What Is the Global Seafood Market

• 1. Global Communication Now Instantaneous
• multiple customers/suppliers available
• 2. Air Cargo Rapid Frozen Transport
• insure rapid delivery anywhere
• 3. Continuous Supply of Reasonable High Quality
• Substitutes from Aquaculture

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Alaskas Share of World Fisheries

• World Production 2007 (FAO) 144,418,000
  mt
• Alaska Harvest 2007 (NMFS) 2,459,070 mt
• Percentage 1.7
• Not Sufficient Command to Control Market

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World Fisheries Production

• .

8
US Seafood Trade

• .

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Alaska Share US Landings

• .

10
US Food Cost as Disposable Income

• .

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Seafood Sales by Product Form

• .

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World Tilapia Production
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Alaska Landings by Volume 2007

• .

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Alaska Landings by Value 2007

• .

15
Top Seafood Suppliers N America 2007

• .

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Customer Delivered Benefit

• 1. Customer Costs Monetary Cost, Time Costs,
  Energy Costs, Intangible Costs
• 2. Customer Benefits Product Benefits, Services
• Benefits, Personnel Benefits, Image Benefits
• 3. Customer Delivered Benefit is Sum of These

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Delivered Benefit HG Pollock

• 1. Buyer Costs Direct Costs .75 / lb. However
• a) Need No Fleet, No Primary Costs
  Processing
• Labor, Equipment, Energy, Overhead or Space.
• 2. Buyer Benefits Value of Fillets, of
  Processing Byproducts, of Jobs, of Image.
• 3. Buyer Delivered Benefit is Sum of These.

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World Salmon Production

• .

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Alaska Strengths Opportunities

• 1. Wild Natural Product
• 2. Sound Fisheries Management
• 3. Omega 3 Fatty Acids
• 4. Vitamin D
• 5. Still Strong in Whitefish Market
• 6. Wild Salmon now a Niche Market Item
• 7. No Effective Substitutes for
• Halibut, Sablefish, Crab

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Alaska Weaknesses Threats

• 1. Inconsistent (Seasonal) Supply Quality
• 2. Labor Issues
• 3. Farmed Fish - Salmon, Tilapia, Organic Cod
• 4. Farmed Industry Keeps Lowering Costs
• 5. US Europe Low Seafood Consumption
• 6. US Unwillingness to Pay More for Food

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The Future

• 1. Need High Quality Fish
• 2. Need Fish Eagerly Sought by Customers
• 3. Need to Limit Competition
• Limit Effective Substitutes
• Limit Competing Regions
• 4. Need to Extract Maximum Value
• 5. One Answer - Marine Aquaculture

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Aquaculture Problems

• 1. Alaskan Hostility to Aquaculture
• Image Farmers versus Hunters
• Wild Plus Farmed versus Beef Pork Fowl
• 2. Direct Competition with Existing Fisheries
• NMFS - Halibut Blackcod
• Threaten Investments in IFQs
• 3. Common Use Issues
• Who Benefits

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Alaska Already Supports Aquaculture

• 1. Ocean Ranching Defined
• Releasing Young Fish for Common Use.
• 2. 36 Salmon (PNP) Ocean Ranching Hatcheries
• 3. 2007 36 of Total Alaska Salmon Landings
• Hatchery Raised Fish
• 4. 56 Licensed Shellfish Farms in Alaska
• 1 Oyster Hatchery, 2 Nurseries.

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Marine Aquaculture

• 1. Want State Waters - Winter Storms
• 2. Want to Prohibit Commercial Fish
• 3. Institute Subscription Buy-in
• 4. Want No Effective Substitutes
• 5. Want Life Cycle Closed

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Marine Aquaculture

• 1. Market as Live Fish - Asian Capitals
• 2. Wait until Plane is on Tarmak to Pull Fish
• 3. Live Transport Systems Developed
• 4. Bering Sea Wolffish Anarhichas orientalis
• 5. Atlantic Wolffish - 2nd Most Valuable Fish
• 6. Market Size Atlantic Wolffish - 5 kg. (11
  lbs.)
• 7. Wolffish - 40 per pound Live Delivered Seoul