Facing the Blob
Amalga Harbor, near Juneau, has a remote release of hatchery chum salmon returning there. Pictured is one the first common property purse seine fisheries.
Challenging statewide salmon harvests have dominated headlines, with record-high sockeye production in Bristol Bay being the state’s primary saving grace.
Challenges facing Alaska’s seafood industry
Challenging statewide salmon harvests have dominated headlines, with record-high sockeye production in Bristol Bay being the state’s primary saving grace. However, salmon are not the only fish in the sea keeping the state’s fisheries afloat, with many fishermen relying on groundfish, herring, and miscellaneous shellfish to make ends meet. Some fishermen use alternative fisheries as a way to balance their portfolios, while others focus entirely on a single target species ranging from Dungeness crab to sablefish. “In a typical year, Alaska’s most valuable fisheries [measured by value of harvest] include salmon, pollock, Pacific cod, crab, halibut, and black cod,” says Garrett Evridge, an economist with McDowell Group, an Alaska-based research firm.
In 2017, salmon was the most valuable fish group. Harvest of all five salmon species totaled more than $781 million in ex-vessel value, the amount paid to fishermen for their catch. However, Evridge notes that 2018 has been a disappointing year for many salmon fisheries, a statewide concern.
“Salmon across the state have come in weaker than forecast, particularly in the North Gulf of Alaska,” says Bert Lewis, the Central Region supervisor of the Division of Commercial Fisheries for the Alaska Department of Fish and Game (ADFG). “In the region I work, we saw some of the lowest returns of sockeye salmon in recent history with the exception of Bristol Bay, where we had the biggest run on record.”
The sockeye salmon harvest is estimated to be 37 percent of the recent ten-year average, making it the smallest since 1975—all other smaller harvests date back to the 1800s.
The “blob”—a warm water anomaly that washed into the Gulf of Alaska in 2015—is thought to be the culprit. With most sockeye salmon spending three years in the ocean, those returning this year initially swam out into warmer waters, which researchers speculate disrupted the food webs that support the salmon, decreasing their survivorship and resulting in poor returns this year.
“That concept is supported by the record return we saw in Bristol Bay, with close to 65 million sockeye returning that, in 2015, came out into the Bering Sea, which did not have this warm-water anomaly,” Lewis says.
However, poor harvests weren’t limited to sockeye: Chinook, chum, and pink numbers all came in low.
“In the Southeast, total salmon harvest will be about 30 percent of the recent ten-year average, due primarily to poor pink salmon run, since pink salmon usually make up most of the harvest,” says Steve Heinl, a regional research biologist for ADFG in Southeast.
“Pink salmon harvest is 19 percent of the recent ten-year average and the smallest since 1976,” Heinl says. “Pink harvest will be less than half of the harvest in 2016 [18.4 million fish], which spurred a formal declaration of disaster.”
Levels are well below ADFG’s forecast of 23 million pink salmon, though only slightly below the National Oceanic and Atmospheric Administration forecast of 10 million to 23 million.
As of late August, chum salmon harvest to date was 69 percent of the recent ten-year average; Chinook harvest was at 30 percent of recent ten-year average; and coho harvest was on track to be lowest in thirty years, says Heinl.
Though state numbers are low, harvest success varied dramatically among systems. In Southeast, there were excellent Sockeye runs at Chilkoot Lake and Redoubt Lake, which stood in stark contrast to poor runs in places such as Situk River, where the fishery was closed for most of the season.
In the Arctic-Yukon-Kuskokwim (AYK) region, the fall chum and coho salmon directed commercial fisheries were still harvesting into the second week of September.
“The most notable change to AYK Region commercial fisheries is the decline in Chinook salmon harvest in recent years. Similar to other areas of the state, AYK Region Chinook salmon production and annual run sizes have declined over the past decade,” explains John Linderman, the regional supervisor for ADFG in AYK. “We have seen modest increases to Chinook run abundance in more recent years, but it remains below historical levels. This has resulted in restrictions and closures to commercial Chinook salmon fisheries and restrictions to subsistence Chinook fisheries throughout the region.”
Commercial fishing numbers for AYK do not include any from the Kuskokwim area, as there have been no commercial fisheries in the region for the past several years due to a lack of active buyers and processors. There are only one or two local catcher-sellers on the Kuskokwim River, and they are focused on small harvests of coho.
“AYK Region commercial buyers and processors have responded to declines in Chinook harvest by being adaptive and shifting focus and operations onto more abundant species, for example, summer and fall chum salmon on the Yukon River,” Linderman says. “Additionally, the largest Yukon River buyer has been instrumental in pursuing new and innovative selective harvest methods that allow for Chinook conservation via live release while retaining target species such as chum. Examples include dip nets and ‘fish friendly’ fish wheels with regulatory requirements for all Chinook salmon to be released alive and unharmed when warranted.”
The good news coming out of AYK is a record commercial chum harvest in the Kotzebue area and a record commercial coho harvest in the Norton Sound area this year.
Despite the poor returns in fisheries, Lewis says he remains optimistic.
“Salmon populations are cyclic and they always have ups and downs,” he says, noting there are plenty of reasons to predict that the populations will rebound.
However, researchers are seeing some stages of dynamic flux where the patterns that had made salmon returns somewhat predictable have fallen apart. Nonetheless, Lewis says that they would need to see data way outside the numbers they’re currently getting to make any changes to the system of managing salmon fisheries in the state.
“The bottom line is our management has been very successful at getting enough fish back into rivers to spawn and sustain the population,” Lewis says. “That is the foundation of Alaska fisheries management for salmon, which sets the golden standard globally for sustainable management. And your in-season escapement goal-based management has proven resilient to changing salmon production levels.
“When you look at the whole, the department manages to put enough fish into the river while you have stakeholders, subsistence, personal use, sport, and commercial harvesters with resource demands that remain the same or grow as the salmon population cycles up and down—that’s where we see the social impact of less fish.
“But as long as we continue to get the number of fish needed into spawning populations, the population remains sustainable and will cycle out of these phases of reduced productivity.”
One broad trend over the last ten to fifteen years throughout the state is record low sizes of returning salmon.
“In the past fifteen years, there is a consistent trend across Alaskan salmon species for fish to come back smaller and younger,” Lewis says.
Not only does this have implications for the market value for the fish, especially sockeye, for which larger fillets are in demand, but it also impacts the processing side.
“In today’s age of automated processing lines, there are lots of challenges when trying to process fish of various sizing,” says Martin Weiser, the chief development officer for Copper River Seafoods. “We end up spending a great deal of labor sorting fish so that the machines can be adjusted to the various sizes. As far as the market goes, it is difficult to get some buyers to want the smaller fillets, as well as get the maximum value for the resource.”
A fish processing plant can only manage a certain number of fish per day. So, if the average weight of fish caught is one pound less and the plant processes 50,000 fish per day, that’s 50,000 fewer pounds of fish being sent to market.
However, low returns and diminutive fish are not what Weiser identifies as the biggest issue facing Alaska’s seafood industry.
Red Flag for Alaska Seafood
“One of the biggest concerns for the salmon industry in coming years is our relationship with China,” Weiser says. “Copper River Seafoods is not a big pink salmon company, so we do not see this affecting us directly, but others who put a lot more effort into pinks than we do will be challenged by this.
“Also, the political challenges and low returns in Cook Inlet are somewhat unsettling to us, as in years past the salmon produced in this fishery are beautiful, high-quality fish that demand high prices in the marketplace.”
China’s recently announced 25 percent tariff on American seafood imports is already causing issues, says Alaska Seafood Marketing Institute (ASMI) Communications Director Jeremy Woodrow.
“The Chinese tariffs will likely increase the cost of Alaska seafood products to Chinese consumers. Depending on the species, the Alaska seafood products may not be cost-competitive with the additional tariff,” Woodrow says. “Implementation of this tariff has already caused hiccups, delays, and order cancellations.”
Sitka Sound herring sac-roe fishery, also conducted with purse seines. Here the catcher boat, left, has tied up to a tender to pump the catch out of his net and onto the tenders hold.
Nonetheless, the Chinese domestic market is still a desirable market for Alaska seafood and the Alaska seafood industry has been building the brand in the market for more than two decades, Woodrow says.
“ASMI is currently not altering its brand strategy in China and will continue efforts to raise consumer awareness and preference for Alaska seafood products. ASMI will also continue to evaluate the market and may alter marketing efforts in the future if necessary,” Woodrow says.
The tariff on seafood was addressed by Senator Lisa Murkowski during a late-July Commerce, Justice, and Science Subcommittee hearing.
“It has clearly rattled my state. Our seafood industry is the number one private industry in terms of the jobs and the economic opportunity it brings. Last year with our salmon exports, about 40 percent of our salmon went to China over the last five years; it’s been about a half of our salmon [that] has been exported to China. And it’s not just the salmon. With cod, 54 percent of our cod [exports] last year went to China. So this is very, very significant to us,” Murkowski told Ambassador Robert E. Lighthizer, US Trade Representative.
“We’re still trying to figure out what exactly this means—not only to our fishermen but to the processors, the logistics industry—all aspects of the seafood supply chain. And then the 10 percent retaliatory tariffs that were announced just last month put even more pressure on our seafood processors because many of our fish and shellfish that are harvested in the state are then processed in China before reimporting back to the US for domestic distribution. So, in many ways, we’re looking at this and it is in effect, imposing a 10 percent tax on our own seafood. Which is just a tough one to reconcile.”
The 2018 season for groundfish targeted by the commercial fishing industry, including halibut, sablefish, Pacific cod, walleye pollock, and several species of rockfish, has yet to end.
Measured by volume, pollock is Alaska’s largest fishery. In 2017 more than 3.4 billion pounds of pollock was harvested in the Bering Sea and Gulf of Alaska.
“Fisheries are ongoing. Comparing the last full year’s data  to previous years shows similar harvest levels for lingcod, sablefish, and rockfish. Commercial landings of Pacific cod were down in 2017 and continue to remain low in 2018,” says Karla Bush, ADFG shellfish-groundfish program leader for the Southeast Region.
Though there are signs of an increased biomass of sablefish, leading to catch quotes being bumped up in some areas, Pacific cod catch rates and harvests have been low.
These lower numbers suggest that Southeast may be experiencing a period of reduced biomass, similar to other areas of the Gulf of Alaska—a prominent theory for this is tied to the same blob that is thought to have impacted salmon returns this year.
“Prevailing evidence suggests that warm water associated with the blob event resulted in poor survival of smaller sized cod and failed recruitment likely due to low food availability,” Nicholas Sagalkin, ADFG Westward Regional supervisor, says. “As a result, 2018 gulf-wide Pacific cod catch is down over 80 percent compared to previous years. Pacific cod catch in the Bering Sea and the Aleutian Islands were similar to previous years [where there is no apparent blob effect]. Catch for the small state managed pollock and rockfish fisheries were also similar to previous years.”
Though groundfish make up a small part of ex-vessel value for Southeast fisheries—about 5 percent—their value to communities and the state as a whole should not be underestimated.
“The groundfish fisheries are very important for the permit holders, depending on what other fisheries they have access to or are involved in,” Bush says.
Overall, groundfish typically represents around 80-plus percent of total fisheries volume in the state and around 50 percent of the total value, Sagalkin says.
“Kodiak, Sand Point, King Cove, Akutan, and Dutch Harbor all have year-round, shore-based fish processors. These processors rely heavily on groundfish to maintain operations. Unlike salmon, most groundfish fisheries occur during fall and winter months,” Sagalkin says.
In recent decades the commercial herring fishery catch has been dominated by the sac-roe and the spawn-on-kelp fisheries, with the product primarily being exported to Japanese markets, explains Kyle Hebert, the herring and dive research program leader for ADFG in Southeast Alaska.
“Compared to other fisheries in the state, herring fisheries contribute a relatively small amount to the overall ex-vessel value. In recent years, herring ex-vessel value has been approximately 1 percent of the total value of commercial fisheries in Alaska,” Hebert says. “During 2013 to 2015, statewide herring ex-vessel value averaged $12 million compared to the total value of state-managed fisheries of $923 million [salmon, herring, invertebrates, and groundfish]. In Southeast Alaska, herring fisheries have contributed about 7 percent to the ex-vessel value of commercial fisheries in the region, averaged over the past twenty years.”
Though herring make up a small portion of the total value of Alaska’s fisheries, they are still important, notes Sagalkin.
“Herring in the Westward Region has become a smaller fishery, but small fisheries are often a very important part of a fishermen’s portfolio to protect against downturns in other fisheries,” Sagalkin says.
For the 2017-2018 season, two commercial herring fisheries were opened in the Southeast: Sitka, which is arguably the most-well known herring fishery in the state, and Craig.
In Sitka, a spawning population largely comprised of young, small herring did not meet the minimum size or roe quality requirements for the market, which meant that the fishermen were unable to meet the guideline harvest level of 11,128 tons or the catch in the sac-roe fishery total of 2,926 tons, Hebert says.
Though the bait fishery in Craig fell short of the guideline harvest level, the estimated harvest for the Craig spawn-on-kelp fishery was 205 tons, which was the largest harvest since the inception of the fishery in 1992.
“The total commercial herring catch of 4,626 tons during the 2017-18 season in Southeast Alaska was substantially lower than the previous season, and generally lower than recent years,” Hebert says.
The average total catch over the previous ten years is 18,265 tons.
“The much lower catch during the 2017-18 season was in large part due to the low catch in Sitka Sound, which is by far the largest herring stock in the region. Additionally, regional harvest was low because no fisheries were opened in areas other than Sitka and Craig because other stock levels were below the thresholds of abundance required to allow fisheries,” Hebert says.
The herring fisheries of Cook Inlet and Prince William Sound declined twenty- to twenty-five years ago and have yet to recover, leaving Kodiak and Togiak as the largest herring fisheries in the state with biomass orders of magnitude larger than anywhere else in Alaska.
Scooping up Shellfish
Results from the Bering Sea crab survey revealed a substantial loss of biomass and abundance in mature red king crab and blue king crab.
However, the picture is not the same for all crab species in all regions.
“Southeast Tanner crab harvests were at the five-year average [1.2 million pounds] for the 2018 season,” Bush says about harvest levels in Southeast. “Dungeness harvests were lower in 2017, and the season was reduced in length due to not meeting the regulatory threshold for a full season. In 2018, the threshold was met and so there will be a full season of fishing. Dungeness crab is more cyclical in the Westward Region because they are at the edge of their range; however, harvest of Dungeness crab in the Westward Region was higher than recent years, and will likely exceed a million pounds.”
Unlike Southeast, which saw average harvest numbers, Tanner crab east of the Bering Sea saw a 43 percent decline of mature males and a 70 percent decline of mature females.
“That has been in a precipitous decline in the last three years,” Foy says. “There is a small amount of juvenile crab that might suggest there’s a little bit of recruitment coming.”
The most positive results from the survey revealed a year-over-year 60 percent increase in the number of mature male snow crabs and a 56 percent increase in mature females.
Miscellaneous shellfish fisheries, or “dive fisheries,” continue to be valuable in Southeast, despite pressure from a growing sea otter population, says Hebert.
“Overall, regional abundance continues to decline; however strong ex-vessel prices and recent action by the Alaskan Board of Fisheries to increase harvest rates have compensated to maintain value.”
The 2018-2019 commercial fishing season has already kicked off for sea cucumbers, geoducks, and red sea urchins.
“Last season, the guideline harvest level for sea cucumbers was about 1.2 million pounds and the preliminary guideline harvest level for the 2018-2019 season is 1.8 million pounds. Fishery guideline harvest levels for geoducks or sea urchins are still being completed for the 2018-19 season,” Hebert says.
In the Westward Region, the dive fishery for sea cucumbers opened in Chignik on September 15, and dive fisheries for both sea cucumber and urchins opened October 1 in Kodiak, with guideline harvest levels the same as the recent ten years.
Many Foes, One Battlefield
Preliminary data indicate the 2017 harvest of Alaska seafood was a record high; it is unlikely 2018 will surpass this figure, as the total value of salmon and Pacific cod—and other key species—are lower, Evridge says.
The Alaska seafood industry is the state’s largest private sector employer, with about 57,000 people directly employed in Alaska across the commercial fishing, processing, and fisheries management sectors, among others, according to the McDowell Group.
“The seafood industry supports economic activity, employment, and tax revenue throughout Alaska. For many communities, this industry is the largest or among the largest source of economic activity,” Evridge says. “Cordova, Petersburg, Wrangell, Sitka, Kodiak, Sand Point, King Cove, Akutan, Unalaska, and other communities all have high economic dependence on the seafood industry.”
From the blob to tariffs, Alaska’s seafood industry—and the communities that are economically dependent on it—faced numerous challenges in 2018. However, strong management policies put in place to avoid the long-term, detrimental impacts of overfishing and variations within fisheries have left many in the industry optimistic.
“The volume and value of seafood harvested in Alaska fisheries often fluctuates year-to-year. The current state of Alaska fisheries is generally in line with previous years,” Evridge says.
Editor’s Note: On September 28, Pacific salmon fillets were removed from the list of products from China on which tariffs will be applied.
In This Issue
The Corporate 100
Alaska Business has been celebrating the corporations that have a significant impact on Alaska’s economy since 1993. At the time, the corporations weren’t ranked as the list didn’t have specific ranking criteria. Instead, the Alaska Business editorial team held long, detailed, and occasionally passionate discussions about which organizations around the state were providing jobs, owned or leased property, used local vendors, demonstrated a high level of community engagement, and in general enriched Alaska.