CROW's Nest is the first monthly in-depth report on the status of the "Tuna Industry." For a copy of the publication, please send your name and address to: Casamar Group, Inc., and advise them that you would like to get a hard copy of the report.

Tuna Market Price Tumbles

As prices of tuna continue to drop, the vessels of the United Tuna Commission (UTC) based in San Diego, California with their twenty plus boats have agreed to keep all their vessels in port for 30 days. Hopefully this action will lower the overall supply of tuna and put a stop to the continuing decline in prices.

Prices of Skipjack (4#) have dropped from a high of US$880$900 in March to a recent low of about US$650. Prices are believed to continue to drop.

In Spain, prices are now reported to be under $620 per ton. This is for the fish purchased from the Spanish fleets discharged in Galician ports. European canneries also purchase tuna from Mexico (ETP) by containers at 810% below the same specie of Spanish onigin.

Traditionally, European canneries and EuroAfrican canneries prefer the Atlantic/Indian Yellowfin to the Western Pacific or Eastern Pacific grade Yellowfin due to their size, color, and yields. With the steady recovery of skipjack landings in the Indian Ocean and the Atlantic Ocean, there will be sufficient Yellowfin for the EuroAfrican canneries procurement. The sudden surge of the US$ against the EURO also increases the ETP fish cost.

In the Indian Ocean, unofficial catch reports for May 1999 of 3000 metric tons show a drop of 60% from the April 99 catch, which was an exceptionally good month. This is not
an unexpected phenomenon. At this time of the year, purse seiner fleets usually leave the Mozambique channel sector near Madagascar to move northward to the Western Indian Ocean waters.

In the Atlantic Ocean, catch reports for May of 5000 MT shows a 10% increase from April 1999. This is to be expected since the moratorium of catches on FADS (Fish Aggregating Devices see June 1999 Insert) ended in March.

The cumulative figures for the YTD May 1999 catches for the Indian Ocean show a 9% increase versus the same period last year. In the Atlantic, there is a 14% increase compared to the same period last year. 1998 was considered a poor year because of the El Nino effects. Therefore, the improved performances were to be expected.

Last week, the IATTC (InterAmerican Tropical Tuna Commission) finished their official report on the ETP (Eastern Tropical Pacific) catches for 1998, the summary report provided are as follows:

There was a decrease of 5% from 1997 to 1998. However, unofficial reports for 1999, show a dramatic YTD increase in catches in the ETP.

The market for canned tuna was not very good in 1998. Canners, traders, distributors finished the year with high inventories of products processed from a high cost raw matenal. The "Solid Raw Pack" style is losing shares of the market in Europe for the second year in a row. Some market analysts blame the poor summer conditions of last year. However, more investigation is necessary to determine if this was just an unusual problem or there exists a deeper crisis in the industry.

In Spain, there is a big struggle between several canners for the "Atun Claro" tuna style (solid pack in oil). It was generally agreed that it was to be packed from first choice Yellowfin, not too small and not too big, around 2535 kgs. Unfortunately, to save money, some canners have filled the cans with Skipjack, instead of Yellowfin, which resulted in unfair competition. However, there is no rule that applies to this case since "Atun Claro" is not a fish, it is only a method of presentation. Besides, it was not clearly protected when the European Community Standards for canned tuna were promulgated in 1993.

At the present time, canneries in Europe are not at full capacity. It is reported that some of them are slowing down. The cold storages are full and the exvessel prices are going down very quickly. There are rumors that some plants in Europe will close in July.

The situation for the tuna vessels is not going to improve much unless the volume of tuna available goes down or if the tuna consumption worldwide increases significantly. The number of tuna canneries worldwide is increasing faster than market demands. The purchasers of canned products - mainly, large retail networks -- are experts at obtaininc, the lowest prices for their products. The tuna canneries, on the other hand, are struggling against each other for their piece of the market.

Albacore Market

Long Line albacore price delivered in Samoa has reached $2,350 per ton. However, fishing is very slow. Jig boat albacore around $2,150 per ton. Transhipped albacore is $300 less, somewhere around $2000 per ton.

Other Tuna News ...

Record Breaking, 30,000 Ton
Catch for the M/V Sea Encounter

To date, the M/V Sea Encounter with Capt. Randy De Silva has cauaht 30,000 tons of fish with his sack and is still going. A standard sack will last on average approx. 10,00015,000 tons. The sack is the costliest and most crucial part of the net. When badly maintained, you can lose a whole catch. A combination of highly skilled fishing, careful attention to detail, good design, and high-quality material will guarantee a reliable and long-lasting sack. Capt. Randy De
Silva learned to fish and to take care of his net from no less than his father, Capt. Joe De Silva, a master fisherman and the owner of the M/V Sea Encounter. Instead of using 45 strips of heavy net on the sack, the M/V Sea Encounter has 9 strips of heavy sack netting. The top 4 strips are NT96 x 3 1/2" followed by 5 strips of NT84 x 31/2". With regular and careful inspection of his sack, he rotates his nets just as a good driver rotates his tires. The "NT96" and the "NT84" are not standard braided nets. They are further processed to increase resistance to abrasion by about 25%. Soon to be available will be the new Casamar "Super NT'" sack netting (patent pending), which is expected to increase wear and tear by another 35%-50%.

For over two decades, U.S. purse seiners have been shifting their operations to the productive western Pacific tuna fishing grounds. reasons for the exodus include a mix of economic, environmental, political and fishery related factors. The decision by U.S. canneries to accept only "dolphin safe" tuna was the final straw that convinced most of the U.S. fleet to abandon the productive Eastern Tropical Pacific (ETP) grounds and move to the west, where tuna and dolphin do not form large schooling associations. Only a few U. S. boats remained in the ETP, and they were encouraged by the National Marine Fisheries Service and other agencies to develop different seining methods to catch tuna without the help or potential to harm dolphins.

Fishing on tuna schools found in association with drifting objects, like logs and rafts was the primary "dolphin safe" methods that was promoted. This seining technique has been the mainstay of the western Pacific purse seine fishery, which was first developed using this method to catch tuna schools found under drifting logs and natural debris. The problem is that naturally occurring drift logs can be few and far between and difficult to locate.

To overcome this problem, tuna boats used to pick up logs in unproductive areas and re-deploy them in areas showing good signs of tuna and baitfish. These logs were marked with radio direction locating beacons in the same way as naturally occurring flotsam and checked periodically for tuna schools.

The next logical step was to construct drifting rafts or artificial fish aggregation devices (FADs) and set them out in productive areas to raise catch rates.

The use of drifting FADs was actively encouraged in the Eastern Pacific Ocean (EPO) a few years ago by the National Marine Fisheries Service as a "dolphin safe" way for tuna seiners to fill their holds without interacting with marine mammals. The use of drifting FADs has become a very popular and productive way to land tuna in the EPO, including some areas that were not heavily fished prior to their use.

The problem is that FADs and logs tend to aggregate juvenile tuna and larae schools of "little tuna" like black skipjack, frigate and bullet tuna, Pacific mackerel and large numbers of other bycatch species. For example, log and FAD fish communities contain significant numbers of wahoo, dolphinfish, marlin, sailfish, jacks, ocean triggerfish, rudderfish and oceanic sharks.

What are the managers and fisheries scientists saying now?

The Inter-American Tropical Tuna Commission is in charge of research to support the management of tuna in this region. They now suggest that a well managed and closely monitored purse seine fishery on mature sized tuna in association with dolphin is a wiser use of resource as compared to a FAD based fishery. Their analysis is based on the following facts:

1. Only large, mature sized tuna that have already had a chance to spawn normally associate with dolphin pods.
2. Dolphin mortality rates due to purse seining have been reduced to very low levels through the use of modified nets, successful release techniques, a strong determination by fishermen to do so, and 100% observer coverage.
3. FADs aggregate large concentrations of juvenile tuna, undersize commercial tuna species and a large community of valuable bycatch species that are of no value to purse seiners, such as wahoo, dolphinfish (mahi mahi), marlin, and sailfish. Both undersize tuna and other bycatch species are often discarded dead by purse seiners.
4. Drifting FADs tend to concentrate on large schools of juvenile bigeye tuna that are easily harvested by purse seine gear for canneries but are far more valuable a few years later to longline fisheries as mature fish for sashimi markets.

This situation has created some strange bedfellows. Sportfishing groups and recreational fishing lobbyists now find themselves of the same opinion as the IATTC and the U.S. commercial purse seine fleet. This is because the sport fishermen feel that large scale purse seining based on FADs will cause greater ecological harm to the ocean environment than seining on tuna found in association with marine mammals. Observer data on bycatch levels, dolphin death rates, and yield analysis of harvesting juvenile VS mature tuna supports their assumptions. Of course, the sport fishing groups are mostly opposed to the high bycatch levels of wahoo, dolphinfish (mahi mahi), billfish and sharks that are taken on FADs because they want to catch these fish themselves.

In recent years, the member countries of the Inter-American Tropical Tuna Commission and the major longline fishing nations have been extremely alarmed at the rapid increase in FAD associated seining, and landings of juvenile bigeye tuna in the Eastern Pacific that resulted from "dolphin safe" practices. Some of these countries still purse seine on dolphin associated tuna schools and would like to see a ban on FAD seining altogether. It appears that the FAD fishermen have become victims of their own success.

During the 62nd meeting of the IATTC, held.in La Jolla, California (15-16 October 1998), the following resolution was adopted:

"The Inter-American Tropical Tuna Commission (IATTC) expresses its concern that the fishery for tunas in the Eastern Pacific Ocean (EPO) associated with artificial floating objects known as fish-aggregating devices (FADs), results in catches with very high proportions of tunas which have not yet reproduced and are of no commercial value, with the result that they are discarded, and also the bycatch of as great diversity of nontarget associated species."

The parties to the IATTC recommended:

1. That tender vessels used to deploy and service FADs at sea be prohibited;
2. That high seas transshipment of tuna by purse seiners be prohibited in the EPO, and;
3. That a limit be put on the number of FADs that a purse seiner can utilize in the EPO.

It is up to each member country of the IATTC to enforce these recommendations, and some countries will undoubtedly do a better job of it than others.

On February 25, 1999, the National Marine Fisheries Service published proposed regulations in the Federal Register (64 FR 9296) that would implement the IATTC FAD recommendations in U.S. fishing vessels and U.S. citizens operating FAD support vessels in the EPO. Additional regulations would be adopted in support of IATTC recommendations for harvest quotas in the Commission's Yellowfin Regulatory Areas. The status of other countries' willingness to enforce these regulations Is not known (by us) at this time.

Purse seiners of several different countries use drifting FADs, and if used in a responsible manner they can be an effective way to catch tuna with acceptable bycatch levels. However, it seems likely that many of those countries will not be restricted in their use of FADs, FAD tenders, or high seas transshipment carrier vessels. Once again, it looks like American fishermen will bear the brunt of restrictive management when they were simply developing "dolphin safe" fishing practices as they had been directed by governments and environmental groups.

What happens next??? Stay tuned and we'll try to keep up with the situation.

Past Issues of the Crow's Nest

Crow's NEST is provided by CASAMAR to its customers for their information only. CASAMAR is not responsible for any errors or delay: in the content or for any actions taken in reliance thereon.