Strong Dollar One Bright Spot in Seafood Sales
By LAINE WELCH
June 19, 2015
Sales and prices for all salmon (especially sockeye) have been in a slump all year. And amidst an overall glut of wild and farmed fish, Alaska is poised for another huge salmon haul, with the largest run of sockeye salmon in 20 years predicted along with a mega-pack of pinks.
Meanwhile, the single toughest thing stacked against Alaska’s sales to traditional overseas customers is the strong US dollar.
“Overall, the dollar is up anywhere from 11 percent to 45 percent or more in some cases, versus the currencies of our buyers,” said Andy Wink, a seafood economist with the Juneau-based McDowell Group. “That makes it really difficult to maintain pricing, because those buyers have to pay more and usually it adjusts somewhere in the middle.”
Exports typically account for 60-70 percent of Alaska’s wholesale seafood sales each year. However, the strong dollar will force more sellers and buyers to turn towards U.S. retail outlets, Wink said, and that could be a good thing.
“The expectation is this will entice retailers because anytime you’re able to buy at lower wholesale prices, typically you’re able to turn better margins,” Wink said. “Hopefully, it will get them to do more promotions and spur more sales because we certainly need it. After last year’s big run of sockeye, the 2013 record pink run, and heading into this year, we’ve got a lot of product out there. But that is great for the long term, because building that consumption is going to build demand.”
That is exactly what has happened over the past year, said Larry Andrews, Retail Director for the Alaska Seafood Marketing Institute, the state’s lone marketing arm. To shrink the amount of carryover heading into another bounteous salmon season, ASMI has hosted over 5,000 frozen sockeye demos at 10 retail chains, representing 4,530 stores in the Pacific Northwest, California, the Rockies, Texas, the Midwest, South and Southeast.
“To date, chains have reported sales thus far ranging from 26 percent to 243 percent increases over the same period last year!” Andrews said.
Sockeye promotions are up 26 percent across all U.S. retail outlets over the past 52 weeks, he added, and the number of stores promoting sockeye at prices below $9.00 per pound is up 146 percent.
The lower seafood prices also are playing well against other “what’s for dinner” items, such as poultry, pork, and beef, which is at an all-time high.
“For the time being, Alaska seafood products are at a better value than they’ve been in a long time relative to other proteins,” Wink added.
Other bright spots for Alaska: sales of competing farmed salmon also are in a slump, and unlike last summer, fewer wild sockeyes are expected at the Fraser River in British Columbia.
“The Fraser River typically only pops every four years so that should be less supply,” Wink explained. “On the farmed salmon side, the expectation is that production will be pretty flat. So that’s really nice. Anytime you see flat farmed production, it feels like supply is being taken off the table because the fish is grown so steadily and it is always so available over time.”
McDowell Group produced a complete analysis of 2015 sockeye salmon markets for the Bristol Bay Regional Seafood Development Association site.
More salmon fisheries are opening up all across Alaska and the catch so far of primarily sockeyes has topped two million fish. Most of the catch has come from the Copper River, although more reds are starting to come in along the Alaska Peninsula and disappointing takes are reported at Kodiak so far.
Trollers are seeing good Chinook salmon catches at Southeast, and a first seine opener for pinks is set for June 21. A humpie harvest of 58 million is expected at the Panhandle this summer.
The Dungeness crab fishery got underway June 15 at Southeast Alaska where the catch should top a couple million pounds; a small dungie fishery also takes place around Kodiak. A small boat red king crab fishery at Norton Sound gets underway any day with a 394,000 pound harvest.
Two of Alaska’s largest fisheries – trawl caught pollock and cod in the Bering Sea - were back out on the water for the summer season starting June10.. Pollock will reopen in the Gulf on August 25.
In other fish news
Sitting commissioners Don Lane of Homer and Bob Alverson of Seattle were the only names submitted for two vacancies on the International Pacific Halibut Commission. Both are likely to be reappointed by the Secretary of Commerce. The IPHC also is seeking a new executive director to replace Bruce Leaman. Applications must be submitted by July 1.
Finally, Electronic monitoring systems will be advanced by a $492,553 federal grant given to the Alaska Longline Fishermen’s Association in Sitka. ALFA, one of only five recipients nationwide, plans to integrate the monitoring on up to 120 small fishing vessels to help relieve the burden of onboard observers. ALFA’s work will obtain reliable data and advance the use of EMS for other local boats.
Laine Welch ©2015
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