Bering Sea/Aleutians processors’ big economic punch

Bering Sea/Aleutian Islands fish processors spend a lot of money in sustaining operations. A new McDowell Group report documented these expenditures in 2016, the most recent year for which data is available. Spending with Alaska-based businesses or firms with an Alaska presence totaled $220 million in 2016 and included:

• $100 million on shipping
• $34 million on fuel and other products
• $32 million on construction
• $17 million on air transportation services
• $  6 million on public services (electricity, water, wastewater)
• $31 million on an array of other services

The inshore processing industry paid $32.7 million in local and state taxes in 2016, representing 56 percent of all fish taxes paid in the state, which totaled $58.8 million. This included the state Fisheries Business Tax as well as taxes levied by local governments.

 

King salmon fishing closures hit tourism

The latest king salmon sports fishing closures will put a damper on summer recreation spending in Southcentral Alaska. King fishing was shut down on Susitna River drainages as well as the Kenai River. State biologists also closed a subsistence fishery on the upper Yenta River. Biologists suspect warm ocean conditions as affecting juvenile king salmon, but some fishermen are blaming the large offshore groundfish fleet as catching too many young kings.

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With a highly uncertain summer salmon season shaping up, the state has gotten word that it will receive $56 million in federal disaster money related to the 2016 failure of pink salmon fisheries. The money can be used for several purposes including infrastructure, habitat restoration and “buybacks” of salmon permits and retraining. The governor’s office will be working with the National Oceanic and Atmospheric Administration on a disbursement plan for companies and communities hurt in 2016.

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 China tariffs spook fisheries

  China announced it will add a 25 percent tariff to existing tariffs for certain seafood imports starting July 6 to retaliate against tariffs on Chinese imports to the U.S. ordered by President Donald Trump. The list includes salmon, pollock, crab, herring. China purchased 54 percent of Alaska seafood exports valued at $1.3 billion in 2017. This comes at a bad time for companies like Trident Seafoods, which is making infrastructure investments in China and is ramping up an Alaska-themed marketing campaign for its products. Alaska pollock producers are worried about losing market share to Russian pollock.

What’s isn’t yet clear is whether China’s tariffs will be applied to fish imported from Alaska for reprocessing into products and then exported from China to another country including the U.S. Salmon, cod and non-pollock groundfish are imported by China for reprocessing. Pollock, however, is typically made into products such as surimi here, either in onshore plants or aboard the offshore factory/trawlers. Companies in pollock and surimi worry about being adversely priced against competitors.

 

Bering Sea capital expenditures

Bering Sea/Aleutians onshore processors made $175 million in capital investments from 2015 to 2017, expanding value-added capacity and infrastructure, according to a McDowell Group report.