Two of Alaska’s biggest seafood company reps already are voicing optimism about next year’s salmon season. Both shared outlooks at the recent United Fishermen of Alaska webinar series. Mark Palmer is CEO of OBI Seafoods –
“We don’t see entering the 2021 season with any real big carryovers. And that’s always one of the downsides as we head into a new season if there’s an abundance of two to four sockeyes or something. We’ve gone into seasons like that and it influences the new season pricing. But I think that as we go into 2021, we should have a pretty clean slate and be ready to buy and ideally put it up in a better product form than we did this last year.”
Allen Kimball, head of global and domestic sales for Trident Seafoods, agreed.
“I’m a little more conservative in terms of looking at next year. I think the positive things are we don’t have inventories around and we have good demand. I think that we’re going to see a lot of adjustments and positive things in terms of the demand existing at retail and it’s going to continue. And I think if we get this food service piece back to full giddy up, it’s going to be quite good.”
With Covid crippling food service, non-stop farmed fish has gone into retail more aggressively than ever and has pushed down prices, OBI’s Palmer said.
“And these aquaculture produced salmon had a huge, huge piece of the food service market and as their market evaporated, they’re still pulling fish out of the water and processing them. And that fish is focused on retail and we’ve watched the aquaculture industry go after the retail market more aggressively than they ever have. Because they’ve got the fish, they’re going to find someplace to move it. We’ve watched prices go down so we’re slugging it out every day to keep our products on the shelf.”
Roughly 75% of the world’s salmon is now farmed, added Kimball. For Alaska, a new headwind could come from a 35% tariff the Trump Administration has imposed on wild salmon going into Europe.
“It is going to have an effect on our ability to get wild salmon into the European Union. With that kind of tariff, it’s going to make it pretty darn tough. But I would say that like it is with many of these tariff challenges, what we’ve seen in China and other countries, the dynamics of this could change in two weeks. And so we’re heavily working on this from a political position standpoint. But if this remains, there is no question this is going to have a big influence on fish next year.”
Tariffs continue to average 35% on most U.S. seafood going to China. Both men called the trade wars a “nightmare” and agreed the biggest imbalance of all is with Russia since 2014. Mark Palmer –
“The disappointing thing is that Russia has open access to our markets and we don’t have any restrictions on Russian products entering our market. And that’s something thing that I just don’t understand the fairness of this. We would rather just see open markets. We will compete against anyone. But if they’re not going to give us access to their market, they shouldn’t have unfettered access to ours.”
Trident’s Kimball says trade deals with Russia and others are likely to change with a new administration.
“If we can’t sell our fish in Russia, they shouldn’t be able to sell their fish in the United States. And I think that’s going to continue to be a battle. We’ll have to see with the next administration how that’s going to materialize. But I anticipate that we’re going to have to be at the table really early and carefully with our groups to make sure that we get our voices heard in this particular issue. Again, I would say this could change quickly, or it could require some time before we get into the first and second quarter of next year with a new administration.”