Update: This story was updated on May 21, 2017 to include new prices.
In economic crisis, there is often opportunity.
Commercial fishermen in Cordova, Alaska are at the moment worrying mightily about what the rest of their fishing season will bring given the prediction of a record weak-return of Copper River king season.
But what the ocean gods have brought so far are sky-high prices for a higher than expected catch of a thought-to-be struggling run of fish.
The first, 12-hour opening of the season was expected to result in the harvest of only a few hundred kings given a prediction of a weak return and fishing-area closures the Alaska Department of Fish and Game ordered to protect areas where kings have usually been caught in the past.
Despite those closures, however, fishermen caught almost 1,900 of the big fish, a catch bigger than in last year’s opener. Most fishermen in the Cordova fleet of 500 gillnetters were reported to be getting dock prices of $10.30 per pound for king, but some were doing much better.
Independent marketers were looking to score big.
Bill Webber at Gulkana Seafoods was offering kings at $50 per pound ordered online with a minimum 10-pound purchase. Webber moved to a direct-to-the-consumer marketing model years ago.
“In 2000, I formed Gulkana Seafoods Direct to provide restaurants (wholesale buyers) to have a direct, premium, sourcing solution,” he says on his website. “We never take our eyes off each and every salmon, from harvest to processing to shipping. I have developed, what I believe to be, the highest quality standards of yielding you premium tasting, visually appealing and highest yielding wild salmon in the world. Our customers are typically, high-end restaurants who source our product on a consistent quantity and basis during the commercial harvest season. They proudly tell the story of our unique processing and handling and consider me their personal fisherman from Alaska.”
Webber is not alone. Others have and are doing the same thing in an effort to maximize the value of the fish.
The marketing is similar to that for fine wine, where consumers have shown a willingness to pay very high prices for premium products. Alaska’s problem is that its premium product is limited and comes on the market in a flood of carcasses.
Prices on Copper River sockeye salmon – the smaller, more plentiful “red salmon” – opened at $6.50 a pound last year but fell rapidly as other salmon producing areas started to pump out similar fish. The average price for the season ended up at $2.24 per pound, according to a report prepared for the Bristol Bay Regional Seafood Development Association.
Bristol Bay is the world’s largest producer of wild sockeye salmon. When its 80- to 100-million pounds of salmon start to hit the market, the law of supply and demand takes over.
The supply of fresh fish suddenly swamps the demand for fresh fish and prices start falling. Compounding that problem is the fact there are so much fresh fish coming so fast the market can’t handle them all and many need to be frozen.
As a result, Bristol Bay fishermen ended up getting only about 76 cents per pound for their fish last year, but they made up for the low prices with their big catches.
In the bigger picture, too, Bristol Bay sockeye are bit players. They influence the market for so-called “wild” salmon, although a lot of the Alaska catch is now spawned in hatcheries, but the market overall is owned by farmed salmon.
Farmed salmon today account for about 70 percent of global consumption of salmon. Wild sockeye amount to only 5 percent with the lion’s share of that coming from Bristol Bay and Russia.
Alaska wild fish compete directly with farmed fish in a market where price is a big selling point. Premium products, like the first of both Copper River king and sockeye salmon, can successfully command high prices, but as wild salmon become more abundant in the market, they become less valuable.
And once the Alaska fishing season ends, customers faced with a choice between fresh fish and previously frozen Alaska fish have shown a willingness to pay more for the former than for the latter.
Alaska has put a lot of money and effort into marketing “wild” fish over farmed fish, but it faces a significant hurdle in that the two taste basically the same with some even giving the edge to the farmed fish.
“Farmed salmon beats wild in Washington Post taste test,” Undercurrent News, a seafood-industry trade publication headlined in 2013.
“A blind taste test of 10 salmon samples organized by the Washington Post saw frozen farmed salmon from Costco top the table, followed by three more farmed fish finishing above the first wild entrant,” said the story below.
Wild salmon is still judged to be healthier than farmed salmon and more environmentally friendly, but fish farmers have been making inroads in both those areas.
So-called “recirculating aquaculture systems” that farm salmon on land in tanks have being winning kudos from environmental and fish sustainability groups. The largest such facility in the world rolled into production on New York’s Hudson Valley earlier this year.
The company aims to provide fresh seafood year round.
“…We have the ability to create greater certainty in terms of availability throughout the year,” Samuel Chen of Hudson Valley told Undercurrent News.
“In the US, RAS farms make up a small part of aquaculture. Chen, however, sees his company at the forefront of what he thinks will be a more common system going forward.
“‘Right now we see ourselves as the tip of the spear in the world of recirculating aquaculture…as aquaculture grows, I see RAS as a critical component,’ he said. ‘This is a commercial operation, but it’s also one step in the direction of demonstrating the viability of RAS on a larger scale.'”
Other worldly prices for Alaska king salmon look to be a great thing for Alaska fishermen now, but there appear to be plenty of rough seas ahead.