2012 Fish Prices
AKFISHER
2012-04-23 03:13:48
Do the prices ever come up at all when diesel is up or is it just kind of SOL to the fisherman? I have a freezer troller and I am wondering if sometimes the better prices are actually worth it considering I figure an extra 25 gallons a day running a freezer. This is my first year so lots of uncertainty! Does anyone know what the difference in price last year was between Slush and FAS
yak2you2
2012-04-23 07:08:44
Been trending this way for years. Every business, and I mean every one has to pass on the inflation driven cost increases to the consumer. As oil prices rise, the cost of operating a combine goes up, so the farmer charges more for his corn. Trucking, air freight, etc. Groceries are sky rocketing acrossed the board, but we never seem to get a cost of living increase.
You should try doing the math to make a big outboard driven boat running. It's getting ridiculous.
What's it going to take? I don't know. A coastwide, international trollers union that's strikes for price? Maybe, but we don't control all the salmon, so I'd be afraid of sending our clients elsewhere. You'd think the processors would recognize that better pay equals higher effort, and raise it on their own and pass it on, but not so far. Maybe look into your own marketing with the high end product you have. This is harder to achieve for day trippers like myself.
SilverT
2012-04-23 20:11:32
Great topic. To piggyback on Yak's comments, I've wondered the same things and dabbled in selling seafood directly. That experience impressed upon me that processors and retailers are the same as any other business operator. They are in business to make money. That means that when the price of fuel goes up, their first thought is, where am I going to make up the difference in cost for the fuel I have to burn to move this fish? Is it going to be on the buying end or is it going to be on the selling end? It must come from somewhere. Because at the end of the day, no matter how compassionate I am, as a wholesaler / retailer, I still have to feed the family.
People generally take the path of least resistance. So as a wholesaler / retailer I'm looking around at my competition. How are they compensating for their additional expenses? Did their price remain the same, is it lower or did they raise it? How often are my buyers calling? How much demand do I perceive? Am I going to be able to move the fish if the price is higher as a result of paying higher dock price? Who's going to give me the most grief depending on which way I go, buyers or sellers? Am I going to lose customers to my competition? Will it be enough to impact our business significantly?
I believe their decisions are based on these or similar questions, rather than compassion for the fleet in most cases. So if trollers work together and provide answers like, yes, indeed you are going to lose a lot of product when the price drops 10 cents a pound because, although we are loyal, we also have families to feed. Then we solidify in the minds of the folks running these questions through their mind solid answers to the questions. Like, As a buyer, the last time I raised the price 10 cents a pound when fuel increased, I had a 50% increase in product intake because folks sold to me. That kind of thought flashing through a buyer's mind, helps swing it in favor of the troller.
There is no question we have the best product available, but there also seems to be an extreme lack of understanding by the public and I don't believe it is their fault. To That end, we need a marketing program that helps to create enough demand around the world that the easier path is to raise dock prices, because you know as a buyer your competition is going to do so.
Lane
Once and Future
2012-04-23 21:18:56
Yak, my own carelessness just lost a post it took me a half hour to create. I may type it again later. But for now, just let me say the following. I don't disagree with the idea of fishermen trying to get a higher price for their product. But you are mistaken if you think farmers raise their prices when fuel costs, etc. go up. Farm crops are a commodity whose prices are determined at the boards of trades in the financial centers.
Cost of production ultimately plays a role in determining price of a product. But the real time, instantaneous price of any perishable product is only determined by one factor: Supply and demand. If there is 10% more corn harvested than can be sold or stored, it is virtually worthless, despite what the farmer paid to raise it.
The law of the jungle is the price will go back up when enough farmers have been forced out of business to weaken supply. But that may take several years and many heart-broken farmers to correct.
Farming and fishing are not your typical business model. Most entrepreneurs are profit motivated. Farmers and fishermen love the life and want to do it as long as they possibly can. The impersonal markets inadvertently disrespect farmers and fishermen's efforts because of that. The markets don't have to pay much, because so many of us are eager to provide the product, even at starvation wages.
lone eagle
2012-04-24 03:48:26
You are right on about the pricing of commodities. I spent many winters long haul trucking listening to the very same remarks about rising costs and declining revenues. Strikes don"t work. The customer squeezes for the lowest cost just like we hunt for the lowest price on fuel . Everyone gets squeezed in a free market. that's what it is. The retailer gets the highest price he can and buys it as cheap as he can. On wall st that's called the margin and the company is rewarded or punished for that.
yak2you2
2012-04-24 06:10:30
All I know is, the price of everything is going up as fuel prices devalue our dollar. Steadily up, on everything except salmon ex -vessel. Doesn't matter if farmers grow to much corn, and get paid less, I'm still always paying more. Same goes for seafood. In a lot of cases were getting paid less per lb. Than we were 30. Years ago, when the dollar was worth ten times as much. The consumer is paying a lot more now for fish than they were 30 years ago, so where is our cut? Ok, bad years happen, but this is consistent, and it almost feels like it happens because we let it. That's what makes me wonder if a coastwide strike would ever have a chance. They said that running the Japanese out of Bristol Bay would be the end of them, but it sure doesn't look that way. So wouldall of our clients turn to farmed fish? I doubt it. I think those would eat it, already do, the health and taste concious will never switch, they'll just begrudgingly hand it over, same way I do when my milk goes up another buck a gallon.
At some point, we have to decide, if we really do love it enough that we'd almost do it for free, then We should figure out how to ratchet the prices up, before it gets so bad we can't even affort to do it for free.
I've tried doing my own marketing, it was a hassle, but I might have to go back to it. At least you can kind of command your own price. Just lots of time on the phone, and packaging. It can work for kings, but it would be impossible with cohos, for me at least.
Once and Future
2012-04-24 11:54:03
I understand your frustration, Yak. You are right to be angry over how producers are treated.
I thought of another example on food prices. I bet you didn't know the farmer gets paid 4 1/2 cents for the amount of corn in a box of corn flakes. Four and one half cents.
I know this because the farmer's groups ran a radio ad in the midwest to counteract the accusation that the high price of corn due to ethanol was behind rising food costs.
And what does the box of corn flakes cost? Three and a half bucks? So the raw material is less than one per cent of the cost of the finished product. The industry could double the price it pays to the farmer. It would make the farmer wealthy, and the consumer wouldn't even feel that pinch.
Another example? Farmers get paid something like $6 a hundred weight for potatoes. Compare that to the price of a bag of potato chips. And there isn't even the equivalent of one large potato in the whole stinkin' bag!
lone eagle
2012-04-25 02:40:44
Apple announced earnings..another quarter of screwing their suppliers and overcharging the customer..nobody accuses them of wrong doing, unlike evil oil companies. Classic example of good business..pay the least for raw materials and charge the most for your product. Isn't that what we all do? Fairness is not a consideration whether you be corn farmer or whatever....
kuiutom
2012-04-25 04:46:32
All good observations.
However, for perspective, while recently doing taxes I uncovered a fish ticket from ten years ago. It was from July 11, 2002 for fish sold to E.C. Phillips at the Port Protection, AK buying station. Prices: Large Red King $0.43, Coho 7lb+ $0.48, Coho <7lb $0.28. But I also recall in August 1976 getting $1.50 coho and $2.25 LRK when diesel was $0.40/gal.
So it is true, prices could be a hell of a lot better.
Or a hell of a lot worse.
salmon4u
2012-04-25 08:40:21
interesting posts, I remember when the markets supposedly crashed after 9-11 and the bad prices that followed. I also remember that retail prices were mostly the same as the year before from what I saw. There was no question everyone in the country was shaken up though.
Also, I think it's false to believe we have a true free market, supply and demand system. There are laws that supposedly prohibit unfair practices. "price fixing?" I've often wondered how can so many different fish buyers all set and pay the same dock price to fisherman. Who comes up with the magic dollar amount that they feel won't quite break the backs of producers? Maybe a fish auction system like used in Japan might not be such a bad idea, at least there would be some transparency.
I enjoy reading about this topic whenever it pops up basically because I am a very ignorant business and economy minded person and really want to understand this game. My wifes family are milk farmers in Sweden and I have become very knowledgeable about that business and many similar lines can be drawn regarding their price of operation and low price paid for milk. However, they are HEAVILY subsidized by the state, about one half of their yearly operaitng cost is given to them every year.
What I wanted to throw in there is that I feel somekind of strike or stand down or whatever would be a useful gesture. Two words: Fish Farms. There are plenty around and even more springing up. Here in Norway the goverment in Oslo just gave the okay for thousands more in Northern Norway. Many of you have seen the farms on the BC coast, but it is about the same or even more concentrated here in Norway.
From a very young perspective as mine, I feel some marketing needs to really be targeted HEAVILY about the health og wild salmon compared to the realtive lack of health of the farm salmon and the destruction the farms do to the local environment and other fish species. I really believe the key to sucess for us SE AK trollers lie in that. The market is getting flooded with cheaply produced farmed slamon and more are on the way. Most people do not know the difference in nutritional content. And those that do have the knowledge have a hard time finding the fresh or wild stuff or ecologically raised stamp that can be found on the "good" farmed salmon. There is an incredible wealth of research and info out there about the content of farmed slamon and the destruction it does. Most poeple seem to really not care too much about the destruction part, but when they learn that the fish they are eating is really not that ll too healthy and may contain some not too desirable additive, etc, then it is more personal.
Otherwise, it is all a mystery to me, this economy. Fuel up, fish price down, milk price down. Obesity of corporate CEOs up.
Tim
lone eagle
2012-04-26 00:10:45
But...oil is real close to last Aprils' price, and fish prices are up..life is good!
SilverT
2012-04-26 01:23:05
I really don't like being frustrated and having no solution. We have been struggling with how to make a really ugly house look good and have had few ideas. Some folks are really good at coming up with their own schemes to make things look better. I don’t seem to be one. So we are cautious when we decide to paint. We drive around and look at other house paint jobs before we select our colors. We figure, if it looks good on their place, it will probably look good on ours. I know – some folks think that's kind of lame, but we found a great color scheme last weekend. With that in mind:
Copper River sockeye sold for $54 / lb last year at the beginning of the season - advertised as such on radio stations covering Washington State. Copper River Salmon is not $45 / lb better than other sockeye, and most salmon fishermen would agree that none of it is better than ocean caught king salmon, let alone $28 / lb better, but the perception by the public is that it is outrageously better.
This is why: http://copperrivermarketing.org/about
And perception is exactly what matters when consumers consider our product and when buyers decide how much they are willing to pay. Two things are necessary to raise the price at the dock. One is a similar marketing and educational program (and agreement from trollers on how to fund it) and two, a way to directly market your product if dock prices are not to your liking.
It is my understanding that co-ops are supposed to somewhat fulfill the second. To some extent, I believe they do, but what kind of marketing program do they have and how much funding are they provided? If they are not provided funding in excess of any other processor, we can't expect them to provide any more marketing or education than any other processor. They certainly can’t be expected to provide the same level of marketing and public education as that shown in the link or that I hear on the radio every year.
I've not heard any educational / marketing ads on the radio advertising the benefits of troll-caught salmon. That doesn't mean it isn't advertised. I have just never heard it. I've heard plenty of explanation on the radio about why Copper River salmon is great, over and over. I shake my head every time. Bottom line: The Copper River guys were willing to band together and fund the educational marketing program. And it is working quite well. I like the color of their house.
Lane
lone eagle
2012-04-26 02:40:00
I worked in the co-op in Cordova in the early '80s and I tell yer the japenese buyers were all over these 'flats reds'. Weren't at all interested in buying reds from other nearby rivers; they went to the lower 48. My point is that these spendy fish were special to start with, the marketing played on that,( and they were first to market). We on the other hand harvest mainly hatchery fish from BC, Wa and Ca. We love 'em anyway. And we get paid a premium over farmed(marketing program). I remember silvers being sold to French smokehouses back in the day but probably no more. In 2007 my buyer only took my cohos cos he wanted my kings, no market for cohos? We should move with the times and adapt- Yak maybe needs a smaller outboard? fish more spreads? guys down here slid over to albacore etc. Me, I think we've turned a corner and things are looking better, I'll stick with trolling kings
I have another thought and observation that I have learned from here in Norway, a traditional fish eating culture. Of the roughly 4,5 million Norwegian inhabitants in Norway on any given day of the week, I would estimate that at least 1 to 2 million are eating cheap canned mackerel for lunch. This is the traditional lunch menu in Norway, the "brødskiva". The mackerel is in a tomato sauce and is eaten on hard or soft bread. It is cheap and it is healthy, easy to pack for lunch and can even be bought in small child size portions that are traditionally served at all kindergardens and daycare centers in Norway.
My wife has an uncle who owns a cheese making dairy in Sweden. They have a large production farm with their own milking sheep and they buy cow milk from my wifes brothers who own the dairy farm now. The cheese facility focuses on high end cheese production, and it is expensive. They have been operating for about 10 years now and they are continually struggling. They just laid off their employees and are doing it all themselves now. They are having money problems, but ironically producing a product targeting the wealthy.
I agree with Lane regarding the Copper River marketing program. Of course they have excelled, and they have a catchy name for a river! But my point is that as trollers we are producing a high quality product and it is marketed for a consumer who has a little money to pay for that product. But that is not exactly what the culture we live in is demanding now. We live in a Wal Mart culture in the USA. People want cheap volume. But interestingly the culture is becoming more aware of the health benefits of eating fish and ecological (organic) products. So my thought is that we need to produce our troll caught fish but package it in a way that suits our culture, like they have in Norway and Sweden. Forget producing so many fillets that people just will not buy, put that coho in a can, or even better a one serving little "sardine-like" can or serving size portions in a vacumm packed frozen package like all the farmed salmon here in Scandinavia is found in. I know it is not original and is even available, but it is not in any way found in the same proportions as it is here. We need to make salmon a daily part of the consumers lunch and dinner, give it to them in a "Wal Mart" style package, but the contents are anything but cheap.
My wife, a farmer from Sweden, deckhanded for me last summer for her first ever experience fishing. After our very first trip cleaning and gutting cohos and kings, she came right out and told me that this was an awful lot of work (i.e. cleaning every fish) for a very small amount of money. She even used the terms maybe even a little foolish. I have not been doing this troll business an awful long time, but I almost agree with her. We are going to troll chums this year, but I am not happy about it. My wife wants a net, but I want to hook.
So although I might not be very informed of what I am talking about, I think we can continue with our high quality, sustainable fishing style that we are all obviously passionate about, but market it for a "WalMart" consumer, cheap and easy to pack with you to work or home, easy to cook and prepare, i.e. spread on a sandwich. One size portions for the kids and single portions frozen for the mom and dad who work and never really learned to cook all too well, especially did not learn how to prepare and cut-up a whole salmon fillet.
OI! I just re-read my first post above and I meant to write that a strike would be a "
SilverT
2012-04-27 02:05:37
It looks like I get to correct my post as well. It was king salmon that sold for $54 / lb. That takes some of the bluster out of my post, meaning that Copper River salmon initially sells for about double that of other salmon. The price comes down as the season progresses, but salmon prices are initially higher by 100%. Sorry for the exaggeration.
Loneagle, what can I say, other than what you suggest is what trollers have been doing since I was a child and I still see buy-backs and trollers scraping for a living. I'd love to believe that things are turning around for good and not just for a couple of years of good salmon runs. One of the main causes of the huge reduction in hatchery production in the south has been that the public simply sees little value in sustaining them. A large percentage of the people I talk to have no idea what a troller is or what it does and they certainly don't know where their seafood comes from, other than it is generally perceived that anything stamped "Alaska" is good. About the same number have no idea what closing a local hatchery will do to the availability of local seafood. They have no ownership, so how can we expect our legislators to protect these things when the path of least resistance only includes upsetting 160 trollers, a few charter operators and a few informed sportsmen. I would rather have the public fighting for us when we bring it to their attention that the local suppliers of their seafood are no longer going to be able to supply it as a result of the closure of hatcheries and such. An educated public usually rallies behind a good cause and they need to know that the decisions that affect us directly affect the availability of their dinner.
Funny Timm, but that's what I assumed you meant. You are spot-on with the portion sizes relative to sales. The first year we retailed, we had vacuum sealed 3.5 lb. king fillets, 6-8 oz. coho portions and 6-8 oz. halibut portions - all incredible looking stuff. Everyone who I knew who liked fish wanted the coho & halibut and I sold out. But, we ate quite a few king fillets because I had a much harder time moving the larger portions. Folks wanted kings, but they only wanted one meal's worth at a time. Few people like leftover fish. I was told by another direct marketer from the mid-west that he had the same issue. He tried to sell whole fish and large portions with little success. As soon as he carved the fish up into portion sized pieces, they flew out the door. I should have listened more closely to him before I made my decision.
Lane
yak2you2
2012-04-28 04:53:34
Lone Eagle, few things. Smaller outboard? Maybe, but all of us are suffering from fuel prices, no way to hide from it. Boats my size run outboards. Get bigger, and then you start feeding the light plant instead. The main point is, things are not ok. Expenses are going up all over, not just fuel. How about insurance? Fish prices HAVE to go up too, or were not going to be in business. Avoiding cohos because they don't pay enough? Not realistic, it's our bread and butter. Notice the king quota went down another 20k this year? Get used to it. And, the way we stab them all in all at once every summer, were not getting paid anywhere near enough to be viable for these either.
As I said from the start, a strike is only a concept, and one that even I am sketchy with, but continuing to take the peanuts that are offered isn't going to go very far. We need cost of doing business built in, same as everybody else, or it simply isn't going to work, even if you learn how to sail.
lone eagle
2012-04-28 05:34:17
I don't know what's going on with the lousy price of coho; my buyer didn't want to touch 'em I have no clue to where they end up in the marketplace and who buys them for what price. We fish in a world of limited entry and gear quotas, and have little wiggle room to adjust to changing markets- we need the market to come to us so we can make a good living and that's the struggle. Farmed fish changed so much and so did Walmart and Amazon. Not easy going up against those game changers....so who buys your cohos?
Kelper
2012-04-28 05:35:32
I hear ya Yak. I pulled the poles off my skiff today and said "dang it"! No more trolling till July 1st for me, as we don't get spring hatchery openings in the Craig area. Kings were just starting to show up to my spots too.
lone eagle
2012-04-28 05:55:38
One thing I seriously don't get- my California and Oregon power permits are worth less than your hand troll card... Can't be that bad up there...and we gave up on insurance 20 years ago!
Again I am sure somebody with a lot more experience and years in the game can answer to me, but why don't trollers and other commercial fisherman get gov't subsidies, like farmers? As I stated above, ALL farmers here in Sweden and Norway get about 50 percent of their operating costs every year for free. Seems like we could at least get a fuel subsidy or something?
yak2you2
2012-04-28 18:39:23
Beacuse Timm, were in the way. they need us to die, so they can build all the hydroelectric dams they want to, without having to listen to the whining about diminished salmon runs.
salmon4u
2012-04-28 21:46:55
good question Timm,
I think people in our government either pretty much hate trollers or are apathetic to anything other than large financial contributors to their campaigns. Trollers might possibly be treated fairly through the legal system. Yet that's a big gamble also. The government has taxpayer paid attorneys and near endless money to fight and stall. The best thing about Alaska is that trolling is still a relatively large part of the states' economy, compared to Calif, Ore, Wa. If enough trollers in Ak are hurting possibly they'll organize, get some media attention, do something besides die a slow death by over regulation. Trollers are such a great group of people and independent that they usually don't fight, say like a Teamsters Union member would. Are their strikes, fisherman unions in Norway?