Economic Impact

Michael Milken evokes thoughts of financial wisdom at a level far beyond that of an unsophisticated fishing industry essayist like me.  So, when one of the sessions at the Milken Institute Global Conference 2009 is titled "Innovative Funding for Sustainable Fisheries and Oceans," I take notice.  The panel for the fisheries session was moderated by Larry Bond, a consultant for the Environmental Defense Fund (EDF) and the speakers were David Crane, David Festa, Jerry Schubel, and Jason Winship.  Two members from EDF and none from the fishing industry, oh, well. 

The macro-economic status of the fisheries is essentially a threatened hostile takeover of the industry by the investment interests of the EDF and other environmentalist organizations.  In a recent article, Nils Stolpe asks, "Is this the future of fishing?"  His answer is alarming.

What is the micro-economic status?  Consider the simplified but typical example of Boat A and Boat B.  Each boat has an owner/captain and three crew members.  Each owner is gifted by NOAA with an identical individual transferable quota (ITQ) or catch share.  Neither boat can fish profitably with the catch allocation that the gifted share carries.  A deal is struck.  Boat A leases Boat B's share.  Boat A goes fishing and Boat B's crew goes on unemployment.

Read the complete opinion piece from American Thinker.

 

 

 

 

 

Gorton's of Gloucester, the fish processor that's been a fixture on the Gloucester waterfront since 1849 and whose oil-skinned Gloucester fisherman as its corporate symbol reaches back for authenticity, is backing the U.S. Agriculture Department's advice to eat more fish with a recommendation to select shrimp, tilapia, salmon and Alaska pollock.

These are species that are not landed from Gloucester boats; but then Gorton's has not bought and used Gloucester fish for many years, according to multiple industry sources.

The recommended species in the e-mail release by Prevail Strategies of Chicago, which does marketing for Gorton's, are among the species that are featured in company product packages or frozen fish.

The Crunchy Breaded Fish Sticks and Garlic and Herb Crunchy Breaded Fish Fillets use Alaska pollock, as do the Potato Crunch Fillets and the Lemon Herb Breaded Fillets, and the entire line of grilled, frozen fillets.

Read the complete story from The Gloucester Times.

 

 

 

 

 

Representatives of eleven environmental groups: Conservation Law Foundation; Environment Massachusetts; Pew Environment Group; Environment America; Conservation Network; Natural Resources Defense Council; Oceana; Ocean Champions; Environmental Entrepreneurs; and Ocean River Institute., have written to the Secretary of Commerce to thank him for his decision to deny Governor Patrick's request to increase quotas for New England groundfish through emergency action.

January 24, 2011

The Honorable Gary Locke
Secretary
Department of Commerce
1401 Constitution Avenue, NW
Washington, D.C. 20230

Dear Secretary Locke:

We write to thank you for your final decision to deny the request to increase quotas for New England groundfish through emergency action. We appreciate the attention and thoughtful consideration that you, your staff and the leadership of NOAA and NMFS have exercised in making your finding of insufficient new scientific or economic data for an emergency ruling. We hope the Governor brings the issues he has identified to the Council’s attention later this month so that an appropriate record can be developed. We also appreciate Administrator Schwaab’s generous offer to continue to work with the Commonwealth of Massachusetts to improve the health of our fish populations.

We note with regret the highly-charged and polarized political context around federal fisheries management in New England, and the particularly unfortunate tone that has been injected into this important civic discourse. We appreciate the professional demeanor and objective consideration of the issues that NOAA and NMFS staffs have displayed throughout this process. It is our hope, and will be our practice, to continue to work toward establishing a culture of debate and discussion on fisheries policy that is based on respect and a common desire to seek lasting science–based solutions.

We must all continue to work toward building the trust, the scientific credibility, and the economic stability on which the health of our Nation’s fisheries depend. We appreciate the commitment you and your senior management team have made to this same objective and look forward to working together with you on that goal.

Thank you again for your sound and thoughtful resolution of this matter.

Sincerely,

Priscilla Brooks, PhD, Vice President and Ocean Program Director, Conservation Law Foundation
Ben Wright, Advocate, Environment Massachusetts
Lee Crockett, Director, Federal Fisheries Policy, Pew Environment Group
Michael Gravitz, Oceans Advocate,  Environment America
Bruce J. Stedman, Executive Director, Marine Fish Conservation Network
Sarah Chasis, Senior Attorney and Director, Ocean Initiative Natural Resources Defense Council
Beth Lowell, Federal Policy Director, Oceana
Mike Dunmyer, Executive Director, Ocean Champions
Berl Hartman, New England Chapter Director, Environmental Entrepreneurs (E2)
Rob Moir President and Executive Director Ocean River Institute

CC:   
NOAA Administrator Jane Lubchenco
NOAA Assistant Administrator Eric Schwaab

Read the letter.

 

 

 

 

 

PORTLAND, Maine—The meat industry has its "Beef, It's What's for Dinner" promotion. Pork producers market their product as "the other white meat." Now, the U.S. seafood industry is preparing to cast its own marketing net in a bid to reel in more consumers.

More than 50 fishing and seafood organizations from 24 states have signed on to the National Seafood Marketing Coalition, a group that's working on a national plan to better market American seafood and is hoping for help from the federal government. Organizers say promotion, new product development, education and other marketing means will strengthen the U.S. seafood economy and generate jobs.

"Our experience is that a little bit of marketing goes a long way," said Dane Somers, executive director of the Maine Lobster Promotion Council who has been active with the national group. "Since nobody's doing much, when you do a little bit it's noticeable."

Americans eat a lot of seafood; the National Oceanic and Atmospheric Administration estimates they spent about $75.5 billion on fishery products in 2009.

In 2009, they consumed 4.8 billion pounds of fish and shellfish, or 15.8 pounds per person. However, 84 percent of that seafood was imported, up from 68 percent in 2000 and 54 percent in 1995, NOAA says.

But it's not just imports that domestic seafood producers are up against, said Bruce Schactler, a Kodiak, Alaska, fisherman who's serving as the coalition's volunteer director. The industry also competes against other proteins, such as meat, chicken and pork, as well as other foods, he said.

Read the complete story from The Boston Globe.

 

 

 

 

 

Many reforms and changes which support conservation also result in higher profits and revenue streams for the involved businesses. This makes fisheries a potentially attractive investment arena for many commercial investors, once reform projects are properly structured and agreed upon between conservationists and the involved businesses. As commercial investors and social investors become more involved in the field of fisheries, the scale of the impacts that can be achieved is expected to expand.

Foundations in the field are now looking to support this transition from fisheries conservation as a purely philanthropic investment to a blended conservation and business investment by encouraging non-profits, social change leaders and business entrepreneurs to create innovatively structured projects that can both build value for private investors and improve the speed and scale of fisheries conservation impacts.

The report contains a section on the Cape Cod Commercial Hook Fishermen's Association's Cape Cod Fisheries Trust.

Paul Parker had spent more than a decade working closely with local small-scale fishermen as head of the Cape Cod Commercial Hook Fishermen’s Association when a sweeping change to fisheries management in the region threatened to put them out of business if they didn’t act quickly.

A longtime fisherman who has a background in biology and environmental management, Parker saw the pressure that transitioning to quota shares would put on family-run fishing operations. In 2005, Parker formed the Cape Cod Fisheries Trust (CCFT) to prepare for the impending transition to quota shares in scallop (2007) and groundfish (2010). He has subsequently raised a diverse multi-million- dollar portfolio that includes both debt and grant capital from a range of philanthropic, commercial, and local government sources. This diverse funding has allowed him the flexibility to manage the risks and uncertain cash flows associated with buying quota so that he can successfully re-lease them to local fishermen, keeping Cape Cod communities afloat.Fishermen Face Challenging Transition

New England’s groundfish stocks, which include haddock, cod, flounder, white hake, halibut, and pollock, have been fished beyond their limit in the Georges Bank off the coast of Cape Cod. Since the 1990s, fishery regulations attempt- ed to protect populations by setting limits on the number of daily trips and days at sea. Opportunistic fishing operations adapted by pursuing larger hauls in shorter amounts of time, causing the regulations to backfire. In addition, fishing practices such as dragging negatively impacted the seafloor and compromised critical fish habitats, straining already depleted populations. And many fishermen were not properly incentivized to minimize by-catch so much valuable fish was wasted, dead and thrown overboard.

In response, regulators instituted a new quota share system. A set number of fishing permits allow only a certain volume of fish to be caught annually. While the system has environmental benefits, it had unintended negative consequences for small-scale fishermen. Permits can be traded and sold for cash, so when demand increases, prices escalate rapidly. Cod permits alone increased in value by 20 percent every year from 2003 to 2007. The economics are similar to the way taxicab medallions work in New York City: limited supply, high price. A single permit that cost less than $200,000 would be a bargain. For fishermen with only a few thousand dollars in their bank accounts, staying in the profession suddenly seemed impossible. Large fishing companies with capital reserves were in far better positions to buy permits.

Before the new program launched, there was speculation that the fishery system would be changed but few were certain about the timing or the guidelines that would be used. While outside observers commonly regarded the Cape Cod Commercial Hook Fishermen’s Association as one of the leading detractors of quota shares due to their community concerns in the 1990’s, Parker saw the writing on the wall and prepared to make lemonade out of lemons. Knowing that the change to quota shares would have adverse impacts on the Cape Cod fishermen if no community entity purchased and held quota in perpetuity, Parker and CCCHFA took action.

Parker created the Cape Cod Fisheries Trust to fill that gap and prevent those negative impacts. The Trust is owned by the Cape Cod Commercial Hook Fishermen’s Association and managed by a local community development corporation. Parker stepped down as executive director of the Association to lead the Trust. While the quota system was still very speculative, Parker decided to buy permits opportunistically and then lease them to local small-scale fishermen who otherwise couldn’t afford them. This would allow him to capture quota at relatively low prices early on, but it also carried significant risks for the association if the quota program was not implemented in a timely or fair way.

Read the report.

 

 

 

 

 

Many reforms and changes which support conservation also result in higher profits and revenue streams for the involved businesses. This makes fisheries a potentially attractive investment arena for many commercial investors, once reform projects are properly structured and agreed upon between conservationists and the involved businesses. As commercial investors and social investors become more involved in the field of fisheries, the scale of the impacts that can be achieved is expected to expand.

Foundations in the field are now looking to support this transition from fisheries conservation as a purely philanthropic investment to a blended conservation and business investment by encouraging non-profits, social change leaders and business entrepreneurs to create innovatively structured projects that can both build value for private investors and improve the speed and scale of fisheries conservation impacts.

The report contains a section on the Cape Cod Commercial Hook Fishermen's Association's Cape Cod Fisheries Trust.

Paul Parker had spent more than a decade working closely with local small-scale fishermen as head of the Cape Cod Commercial Hook Fishermen’s Association when a sweeping change to fisheries management in the region threatened to put them out of business if they didn’t act quickly.

A longtime fisherman who has a background in biology and environmental management, Parker saw the pressure that transitioning to quota shares would put on family-run fishing operations. In 2005, Parker formed the Cape Cod Fisheries Trust (CCFT) to prepare for the impending transition to quota shares in scallop (2007) and groundfish (2010). He has subsequently raised a diverse multi-million- dollar portfolio that includes both debt and grant capital from a range of philanthropic, commercial, and local government sources. This diverse funding has allowed him the flexibility to manage the risks and uncertain cash flows associated with buying quota so that he can successfully re-lease them to local fishermen, keeping Cape Cod communities afloat.Fishermen Face Challenging Transition

New England’s groundfish stocks, which include haddock, cod, flounder, white hake, halibut, and pollock, have been fished beyond their limit in the Georges Bank off the coast of Cape Cod. Since the 1990s, fishery regulations attempt- ed to protect populations by setting limits on the number of daily trips and days at sea. Opportunistic fishing operations adapted by pursuing larger hauls in shorter amounts of time, causing the regulations to backfire. In addition, fishing practices such as dragging negatively impacted the seafloor and compromised critical fish habitats, straining already depleted populations. And many fishermen were not properly incentivized to minimize by-catch so much valuable fish was wasted, dead and thrown overboard.

In response, regulators instituted a new quota share system. A set number of fishing permits allow only a certain volume of fish to be caught annually. While the system has environmental benefits, it had unintended negative consequences for small-scale fishermen. Permits can be traded and sold for cash, so when demand increases, prices escalate rapidly. Cod permits alone increased in value by 20 percent every year from 2003 to 2007. The economics are similar to the way taxicab medallions work in New York City: limited supply, high price. A single permit that cost less than $200,000 would be a bargain. For fishermen with only a few thousand dollars in their bank accounts, staying in the profession suddenly seemed impossible. Large fishing companies with capital reserves were in far better positions to buy permits.

Before the new program launched, there was speculation that the fishery system would be changed but few were certain about the timing or the guidelines that would be used. While outside observers commonly regarded the Cape Cod Commercial Hook Fishermen’s Association as one of the leading detractors of quota shares due to their community concerns in the 1990’s, Parker saw the writing on the wall and prepared to make lemonade out of lemons. Knowing that the change to quota shares would have adverse impacts on the Cape Cod fishermen if no community entity purchased and held quota in perpetuity, Parker and CCCHFA took action.

Parker created the Cape Cod Fisheries Trust to fill that gap and prevent those negative impacts. The Trust is owned by the Cape Cod Commercial Hook Fishermen’s Association and managed by a local community development corporation. Parker stepped down as executive director of the Association to lead the Trust. While the quota system was still very speculative, Parker decided to buy permits opportunistically and then lease them to local small-scale fishermen who otherwise couldn’t afford them. This would allow him to capture quota at relatively low prices early on, but it also carried significant risks for the association if the quota program was not implemented in a timely or fair way.

Read the report.

 

 

 

 

 

With time of the essence, the commonwealth's scientific and economic report, prepared by UMass Dartmouth's School of Marine Science and Technology along with the Massachusetts Department of Marine Fisheries, intentionally based its analysis on the government's existing science and the data currently used to determine annual catch limits. That report was sent to Locke in early November, urgently asking the secretary for more fish.

His response did not sit well with SMAST marine biologist Steve Cadrin, one of the principal authors of the report.

"It's a Catch 22 situation because if we had come up with our own data they would have said that these haven't been peer-reviewed," he said. "But when we use data that the agency itself has published, they say that it's not new information. So they are going to get you either way."

"There is no way to get around these criteria. Did they know that before they even asked us to provide them with the report?"

Adding insult to injury, Cadrin said, the government's response also contained a number of factual errors, leading him to believe it had been hastily constructed, despite the fact that it had taken two months for a reply.

The government response claimed that the secretary cannot deviate from decisions made by the New England Fishery Management Council, an assertion Cadrin flatly rejects. "They have done that time and time again. There have also been emergency actions without peer-reviewed data many times before, so that is the source of my disappointment."

In October, under pressure from a bipartisan congressional delegation, Locke had agreed to consider revising catch limits if scientific evidence supported an increase without undermining conservation goals.

That announcement was viewed on the waterfront as a major concession and had raised hopes, but his reply, on Jan. 7, shattered those expectations. Locke's letter was accompanied by another correspondence, penned by Eric Schwaab, NOAA's assistant administrator for fisheries, which elaborated on the rationale behind the secretary's denial.

Schwaab's reply, categorized by Cadrin as "procedural and defensive," also contained some troubling elements, he said.

"It was very poorly drafted," he said. "It said that decreasing the uncertainty buffers would not allow for rebuilding stocks. But if they even knew the basis of the groundfish catch limits they would know that, for those stocks that are rebuilding, there are no buffers. We specifically laid that out in the governor's report."

This was particularly troubling, he said. "If they read our report, never mind the agency's own guidelines, they wouldn't have had such a blatant error in their reply to us."

Finding these errors has led him to conclude that the commonwealth's case for an easing of catch limits was never taken seriously, Cadrin said.

Read the complete story from The South Coast Today.

 

 

 

 

 

President Obama said jobs and the economy would be central to his upcoming State of the Union address in a videotaped preview of the speech that was sent to supporters on Saturday.

"My principal focus, my number one focus, is going to be making sure that we are competitive, that we are growing, and we are creating jobs not just now but well into the future," Obama said.

In his videotaped remarks, Obama acknowledged the challenging economic times, calling the past two years "as tough as anything we've gone through since the Great Depression."

He said significant progress has been made recently, claiming that more than a million jobs had been created on his watch and that the once-shrinking economy is growing again. But the president added that many Americans are still struggling to make ends meet.

Read the complete story from CNN.

 

 

 

 

 

To keep the Gulf of Maine's northern shrimp stock healthy, its governing Atlantic States Marine Fisheries Commission established a tentative Dec. 1 to April 15 continuous daytime harvesting period that cannot land more than 4,000 metric tons.

This year's season could end early like last year's if that limit is surpassed. Maine fishermen netted or trapped most of the 12 million pounds of shrimp landed last year. Only two Cape Ann draggers briefly shrimped that season.

"We are shrimping because we are out of fish," said Gloucester Capt. Ricky Beal. "We always used to go shrimping, (but) the last time we went was in 1997" added Beal, who crews the 54-foot steel stern trawler, Horizons, with Charlie Reed.

"I don't have any choice (but to go shrimping). I'm just about out of codfish (quota)," added Paul Theriault, the Rockport owner and the Captain of the 42-foot Terminator.

"If I can get till the middle of March (shrimping), I'll be tickled pink," added Theriault, whose Terminator, also crewed by Ryan Osmond, is the only Cape Ann shrimper to work out of Pigeon Cove Harbor.

The northern shrimp numbers and quality are usually at their best in Ipswich Bay and nearby Scantum Basin, during cold Januaries and Februaries. The Cape Ann fleet has been lately working Ipswich Bay where it has often netted approximately 300 pounds of around 55-count (55 shrimp to the pound) shrimp per hour of bottom towing time.

Read the complete story from The Gloucester Times.

 

 

 

 

 

 

The movement to establish a national seafood marketing program in the United States to bolster consumer awareness, and potentially consumption, of domestic seafood took a step forward last month. Participants in the National Seafood Marketing Coalition agreed to set up five regional seafood marketing boards at a meeting in Seattle.

The five boards — Western Pacific/Alaska, Pacific, Gulf/Caribbean, Northeast/Great Lakes and Southeast/Mid-Atlantic — would manage and distribute funds within their respective regions through a grant process. That would allow the program to be controlled locally by organizations already marketing seafood. The program would include both wild and farmed seafood.

The establishment of the five boards and a National Seafood Marketing Fund (NSMF) hinges on yet-to-be-introduced legislation in Congress that would institute a long-term source of funding for the NSMF. Among the funding sources being explored include the Saltonstall-Kennedy Act of 1956.

“We’d be happy to see this legislation on congressional stationary tomorrow,” Bruce Schactler, the coalition’s director, told SeafoodSource on Friday.

Schactler said several lawmakers have voiced their support for such legislation, and 46 letters, including one from Alaska Gov. Sean Parnell, have been sent to congressional leaders urging them to act on such legislation.

Read the complete story from Seafood Source.