FISH FACTOR: Loan program established for entry-level fishermen
More young Alaskans are officially among the next generation of professional fishermen and ocean stewards to hail from Cordova, Haines, Homer, Ketchikan and Sitka.
The futures of eight fishermen were cemented thanks to $1.5 million in loans from a Local Fish Fund, or LFF, launched in 2019 that enabled them to buy into halibut and sablefish fisheries that normally would be out of reach. Buying quota shares of halibut, for example, can cost from $40 to $55 per pound.
“I’m super excited that we were able to move the $1.5 million that was provided to us to invest in new entrants. Some are deckhands and some are vessel owners. I’m just really pleased at how this has gone for this first tranche of funding,” said Linda Behnken, executive director of the Sitka-based Alaska Sustainable Fisheries Trust that worked for a decade in partnership with conservation and finance experts to craft the fund.
“The cost and risk involved in accessing Alaska’s quota share fisheries are comparable to purchasing a hotel as a first step in home ownership,” Behnken added. “As a result, the number of young rural residents entering the fisheries has dropped significantly over the past 15 years. Local Fish Fund lowers both the risk and the initial cost new entrants face.”
The fishermen will repay the loans based on the prices they get for their catch.
“It’s just a really different loan instrument,” Behnken said.
The LFF works on a 10 percent down payment and the borrower’s risk is shielded to that amount. The loan is secured by the quota shares of the fish they are purchasing. Payments are based on what the borrower makes from fishing and fluctuate as the price of fish or the quota goes up or down.
Behnken said the structure allows borrowers to build equity and a credit history over a five- or six-year period that should enable them to qualify for refinancing with a traditional lender.
The LFF also incentivizes ocean stewardship by giving fishermen a small break on their loan interest by participating in local projects such as electronic monitoring, mapping the ocean floor, logging bycatch to avoid hotspots or networking to keep whales away from fishing gear.
“There are many opportunities for fishermen and the scientific community to team up to get a better understanding of our fisheries and the ocean environment. Some of the partners we’re working with are coming specifically from that impact investment sector that is trying to obtain conservation goals through innovative lending,” said Dustin Solberg of Cordova, a spokesman for the Nature Conservancy, which works with fishing communities around the world to develop economic incentives for good stewardship.
The Nature Conservancy, Rasmuson Foundation and Catch Together capitalized the loan fund. Craft3, a nonprofit based in Oregon and Washington, is underwriting, closing and servicing the LFF loans.
Fund managers now will take about a year to assess the LFF program and determine the timing and sizing of a future round of lending. They already have a list of interested applicants, Behnken said, and the goal is to expand LFFs to help safeguard Alaska’s fisheries for future generations.
Bering Sea gets three
Bering Sea crabbers will drop pots for king crab, snow crab and bairdi Tanners when the fisheries get underway on Oct. 15.
As expected, the catch was reduced for red king crab taken in the eastern Bering Sea waters of Bristol Bay; just 2.6 million pounds is a 30 percent drop from the 3.8 million pounds taken last season.
“We’ve heard from scientists in the past that there has not been good recruitment into that fishery for over a decade,” said Jamie Goen, executive director of the trade group Alaska Bering Sea Crabbers, which represents harvesters.
For the first time since 2018 there will be a bairdi Tanner crab opener with a catch of 2.3 million pounds.
And as expected, the catch for snow crab was increased, but not by as much as crabbers had hoped. Managers set the snow crab catch at 45 million pounds, a 32 percent increase from last season’s take of 34 million pounds.
Signs point to a strong market for snow crab, predicts market expert John Sackton, founder of SeafoodNews.com. The crab has been one of the top selling seafood items all year and Sackton said “snow crab is currently oversold, and back up to record price levels.”
He credits the Bering Sea crab’s popularity to several things; above all, 16 years of non-stop exposure from the wildly popular “Deadliest Catch” television show.
“In this case, crab has benefitted from hundreds and hundreds of millions of dollars of television exposure consistently, year after year. It is my view that this exposure has increased demand for snow crab,” Sackton wrote in a market analysis.
The fact that snow crab is precooked and ready to eat is a big plus, and a waning Japanese market has provided more snow crab to U.S. buyers. The market also is expanding to China and more European countries.
Sackton said snow crab from eastern Canada, the world’s largest producer, already is oversold and orders are now being filled with crab from Russia.
“There is little snow crab available and buyers are scrambling to cover their sales,” he said, adding that means customers will now have the option to buy more snow crab from Alaska until Canada’s fishery reopens in April.
No urchin searchin’
Alaska has urchin fisheries each October in Southeast and Kodiak, but they attract almost no interest from divers.
A harvest of just less than 3 million pounds of red urchins is allowed at Southeast this year, but that may not be a true representation of the stock.
“That’s a little bit of a ghost guideline average level, because there aren’t that many sea urchins still here,” said Phil Doherty, co-director of the Southeast Alaska Regional Dive Fisheries Association in Ketchikan.
Since the 1980s and ‘90s, Doherty said the bulk of the sea urchin beds have been wiped out by sea otters.
“That’s the No. 1 factor in the lack of production in Southeast Alaska, and there’s nothing that’s going to happen here in the foreseeable future that’s going to change that,” he said.
A second reason for the disinterest is the difficulty getting the delicate uni from the softball-sized urchins to Japanese markets in top condition. Uni, or roe from sea urchins, is a popular delicacy with many sushi lovers.
“The Japanese market is very particular on how seafood looks and uni is one of them. It’s very difficult to crack open the urchins and get the roe out and pack it and have it look good, and then put it in special containers and get it onto the airlines and get it over to Japan, which is the main market,” he explained.
The most recent Southeast harvest of about 700,000 pounds of urchins in 2015 was taken by a handful of divers who got 49 cents per pound.
Green urchins that are found around Kodiak Island are preferred over the reds. But a lack of markets also has stalled fishing interest there and no harvest has occurred since 2001.
“It’s not that the harvest stopped because we had concerns about the stock. It was largely market driven. I think the major barriers for even a small scale fishery is finding a market and getting them there in good condition,” said Nat Nichols, groundfish and shellfish manager for the Alaska Department of Fish and Game at Kodiak.
In the 1980s, Nichols said landings of the hockey puck-sized green urchins reached about 80,000 pounds. Now the harvest limit is 65,000 pounds, but no divers have signed up for the fishery.
Urchin uni is more familiar to U.S. buyers now than in the past, Nichols said, and perhaps there might be more local interest.
“If you could develop a smaller local market, it would alleviate the issue of getting bigger loads of product in good condition. That might spur more participation,” he said, adding that he is interested in working with anyone who wants to revive Kodiak’s urchin fishery.
No fishing sector is more driven to build demand for their products than Alaska’s pollock industry. The trade group Genuine Alaska Pollock Producers, or GAPP, announced last week that nearly $750,000 will fund seven familiar food purveyors who are launching new products.
Gorton’s Seafood received funding to launch a campaign called, “Move Over Meat, it’s Seafood Time” that will feature Alaska pollock recipes and highlight the health benefits of eating more seafood.
High Liner Foods will introduce its new Alaska Wild Pollock Fish Wings as part of its “Go Wild” line in convenience stores and quick serve restaurants.
7-Eleven was awarded funding for a follow-up 2021 promotion to its popular wild Alaska pollock fish sandwich that debuted during Lent this year.
Pescanova USA will use funds to introduce its new chilled Fettuccine Protein Pasta made from Alaska pollock that will be marketed as “all good, no guilt” pasta.
Restaurant Depot will begin carrying a variety of Alaska pollock products in its club stores, and a partnership with Louis Kemp and celebrity chef Nancy Fuller will showcase wild Alaska pollock snacks during the 2021 Super Bowl.
The ongoing funding is part of GAPP’s partnership programs in North America and Europe to provide support for companies who want to bring new products to market or introduce Alaska pollock where the fish has not had visibility. GAPP has committed nearly $3 million toward this initiative for 2019-2020.