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One Man's Opinion: Politics Make Fish Producers See Red
By Peter Redmayne
June 01, 2005
Being a fisherman is a tough job, even in the best of times. Since harvesters rely on a wild resource, supplies can vary dramatically from year to year. Overhead, on the other hand, doesn’t go away just because the fish do. Fish farmers have their challenges, too. Disease and storms are but two maladies that can wreak havoc with profits.
But for a lot of people, the most maddening thing about producing fish is the politics. It takes a lot of the fun out of the business and can make it very hard to make money.
Consider the Norwegians, who always seem to get in trouble with their farmed salmon. In the early 1990s, they were given the boot from the U.S. market after North American companies accused them of dumping. Even though the Norwegians were getting a nice premium for their fish in the United States, the unfathomable way the U.S. Department of Commerce determines production costs was enough to sink Norway’s salmon farmers.
European politics have been even worse for the Norwegians over the years. Their main nemesis is the Scottish salmon-farming industry, whose higher production costs make it hard to compete with the Norwegians. Over the past decade, however, most of the small Scottish salmon farms have either thrown in the towel or been acquired by big salmon-farming multinationals with operations in Norway, North America and Chile; 75 percent of the Scottish farmed-salmon industry is now owned by outsiders.
Still, the handful of small farmers left in Scotland’s salmon business have remarkable political clout. For most of the last 10 years, the EU has either restricted the volume of salmon Norway could export to the EU or set minimum price levels. The latest agreement expired late last year. Then, even though the price of their salmon had climbed back to profitable levels, the Scots again complained to the EU, as Norwegian farmers developed new markets in Eastern Europe and China.
Late this April, the EU announced it was slapping Norway with a 16 percent duty on salmon exported to the EU, a move that drove the Norwegians nuts.
“I’m never selling a pound of salmon in the EU again!” shouted one Norwegian salmon exporter at the recent European Seafood Exposition in Brussels. It remains to be seen, however, just how many Norwegians can shun the EU market without going broke. Norway exports almost 400 million pounds a year — about 60 percent of the EU salmon supply — to the EU.
Meanwhile on the other side of the Atlantic, politics have crippled this year’s Newfoundland snow-crab fishery. Processors managed to convince the province’s premier, Danny Williams, that processor quotas were necessary to rationalize an industry plagued by too many plants chasing too few fishermen. Under that scenario, processors who don’t get enough production through their plant inevitably drive the price up to attract more fishermen.
And that can be painful for processors, especially this year, when the price of snow crab sections has plummeted from $4.50 to about $3.50 a pound.
Well, you can imagine the reaction of Newfoundland fishermen to the idea of processor quotas. In late April, they stormed the legislature in St. John’s and blockaded several ports. Almost a month into the season, no pots had been dropped, and both sides were backed into “no compromise” positions.
It would be nice to think that the fish business might one day be a little less political. But that’s wishful thinking. In the meantime, if you’re a producer, you might try to convince your banker to be a little more understanding.Contributing Editor Peter Redmayne lives in Seattle