Alaska’s early salmon runs are going strong and market outlooks appear favorable, but there’s an added level to the usual uncertainties: the Trump Administration’s trade war with China.
“The industry is accustomed to dealing with uncertainty about harvest levels, prices, currency rates. The trade disputes just add another layer to that.”
Garrett Evridge is an economist with the McDowell Group.
Tariffs up to 25 percent on Alaska seafood products coming and going from China went into effect last July and more are threatened now.
“And it’s important to remember that a tariff is simply a tax. It increases the prices of our products. As Alaskans, we are sensitive to any increase in the price of our products because we are competing on a global stage.”
Seafood is Alaska’s top export by far and values of other nation’s currencies against the US dollar also have a big impact. Currency rates can fluctuate 10 to 15 % or more which poses a big challenge for the seafood industry as well as buyers. Generally, a weaker US dollar means other countries can purchase more seafood more affordably.
“Right now the US dollar versus the yen is roughly flat on a year over year basis, the dollar has strengthened a bit against the Euro and is up about 8 percent against the Chinese yuan.”
Evridge says in a typical year, Alaska contributes 30-50 percent of the world’s wild salmon harvest. But when you include farmed salmon, Alaska’s contribution is closer to just 15 percent of the total salmon supply.
Farmed production could be on the lower end this year and prices higher. That’s good news for wild –
“We want to avoid that situation where farmed salmon is substantially cheaper. Often, our wild salmon is sold alongside competing farmed salmon. So we want to avoid a situation where Alaska salmon is $2, $3, $4 more expensive per pound.”
One market to watch this summer, Evridge says, is pinks. Alaska is projecting a big catch of 138 million humpies, nearly 100 million more than last year. That will compete with another record Russian harvest of over one billion pounds of pinks.
By comparison, last year Alaska produced about 152 million pounds of pink salmon.
“Russia is ramping up their production of pink salmon and are increasingly a factor when considering where the market might go.”
The Alaska Dept. of Fish and Game is predicting a total, all species catch of 213.2 million salmon for 2019, compared to about 116 million salmon last year that was valued at almost $600 million at the Alaska docks.
The harvest breakdown this year is pegged at 112,000 Chinook salmon in areas outside of Southeast Alaska. Chinook harvest numbers for Southeast are determined be treaty with Canada, and the all gear limit will be 137,500 kings.
For sockeyes, a catch of just under 42 million is projected, about 9 million fewer than last year.
For pinks, a haul of nearly 138 million would be 97 million more.
A coho salmon harvest of 4.6 million would be an increase of 900,000 silvers over 2018.
Chums are projected to set a record with a catch of 29 million, nine million fish more than last year and well above the 25 million record for chums set in 2017.
You can track Alaska’s salmon season with weekly emails Evridge compiles for the Alaska Seafood Marketing Institute.
“It’s a weekly email update that gives folks a sense of what areas are producing versus prior years. The goal is to provide a quick snapshot of 2019 versus 2018 as well as the five year average.”
Sign on at email@example.com/