Tuna Market Intelligence - Read Issue 1

Issue 1, 1 October 2014
Your fortnightly report on trends and influencers on the global tuna market from the Pacific Islands. Click this link to read PDF http://www.pnatuna.com/sites/default/files/Market%20Intel%201.pdf or read this page for this edition.

MARKET UPDATE

Tuna prices quoted at the Bangkok tuna market have plunged to an all time low US$1350 per metric tonne of skipjack in the last week of September. This is a drop from US$ 1545 in early September and follows price drops from US$1820 in July to US$1720 in August this year.

TriMarine International attributes this plunge to a surge of purse seiners in PNA waters, including newer and more powerful vessels, which has increased catch and driven demand to a downward trend. Phil Roberts, Managing Director of TriMarine International, also attributed the trend to too much fishing in the Western and Central Pacific Ocean, which supplies most of the world’s tuna. This concurs with the recent scientific advice from the Secretariat of the Pacific Community (SPC) in August that skipjack catch levels were the healthiest at slightly over 50 percent of the Limited Reference Point.

PNA director Doctor Transform Aqorau said fishing companies were smartening up and stocking their tuna during the period of Fishing Aggregate Device (FAD) closures. It looks like the processors have influenced the supply chain by stocking up and driving prices down with the drop in demand. Dr Aqorau said despite FAD closures, aimed to control overfishing, it has had the opposite effect recently.

It may seem a gloomy prospect for PNA nations but the processors like Thai Union are having a field day in Pacific waters. Watch more action on the PNA's Vessel Day Scheme scheme to counter this trend.

Send us your tips to marketintel@pnatuna.com

INFLUENCERS REPORT

***Processors boom***
Whilst the news from the Thailand tuna market may not seem all rosy two announcements within the region are expected to have a more positive effect on the tuna front.
Papua New Guinea continues to head development and employment opportunities in the PNA after it announced a US$22m onshore tuna processing facility in Lae last month, which will bring more employment to locals in the area.

The project at Malahang is expected to generate US$65 million (K158.75 million) annually in export sales. It would have an estimated production capacity of 120 metric tonnes per day with capacity to increase to 300 metric tonnes per day, providing 1200 direct and a possible 1000 indirect jobs for locals.

TriMarine International, which has operations in PNA waters, has sealed a deal with United States supermarket chain, Costco to bump the former Chicken of the Sea brand off their shelves and replace it with canned skipjack tuna under the Kirkland Signature brand. This is good news for American Samoa as TriMarine will be injecting investment for this new project, which will create 1,500 jobs there.

"We are busy building up the business to maximize the capacity of Samoa Tuna Processors (STP), and anticipate that when we do so it will bring more than 1,500 jobs to the community," TriMarine's Heidi Happonen said. "It is imprecise to attribute that job growth to specific customers but The Tuna Store, which is the Tri Marine Company responsible for selling the production from Samoa Tuna Processors (STP), is actively pursuing appropriate markets to sell the entire productive capacity of STP."

Boats fishing in PNA waters have the opportunity to deliver their fish to the American Samoan facility and benefit from this opportunity. More contracts mean more jobs from fishing, monitoring to processing and packaging.

***PNG address yellow card***
Papua New Guinea's fisheries officials are racing against the clock to remedy a yellow card warning issued by the European Union that they risk being identified as countries it considers non-cooperative in addressing unreported and unregulated (IUU) fishing.
In June this year the European Commission's Directorate General for Maritime Affairs and Fisheries (DG Mare) issued the yellow card citing certain shortcomings or controls that would deter IUU activities or deficiencies in monitoring, controlling and surveillance of fisheries.
John Kasu, head of PNG's fisheries body the National Fisheries Authority travelled all the way to the Marshalls this month to discuss these issues with European Union officials currently engaging PNA nations on a number of fishery issues.

The National reports Kasu this week as saying most of the EU concerns were backdated to 2009, which PNG had been addressing. However, Kasu said at the same time they had not engaged with the EU on developments in this matter. NFA has amended their tuna management plan to meet the requirements of the EU.

The irony is the fact that the EU's fishing fleet has been allegedly engaged in the same IUU activities in the past. But the positives coming out of this exercise should see a stronger, efficient and more compliant fishery from one of the Pacific's giants in tuna stocks.
Palau
Japanese fishing boats are wising up to the fishing ban being proposed by Palau.
With plans to submit proper legislation to their bicameral house in October, the Japanese are looking at ways they can assist Palau monitor IUU fishing in their Economic Exclusive zone.
Palau's government plagued with past experiences with foreign fishing vessels may warm up to the offer by the Japanese fleet.
Stay tuned for more information on this development.

***FSM update***
Interesting times in Federated States of Micronesia where the media has been following the Congressional Committee Hearings on its tuna fisheries. The Kaselehie Press reports that Senator David Panuelo, Chairman of FSM Congress’s Resources and Development Standing Committee called the FSM’s National Oceanic Resources Management Authority (NORMA) to an oversight hearing claiming that 920 of FSM’s fishing days had gone unsold in 2013. NORMA argued that non-fishing days are not a salable commodity. So far the committee has not issued a report on that oversight hearing but it was clear that the Chairman was not convinced that NORMA had received the maximum value from the FSM’s EEZ in 2013.

***Future of day trades***
Meanwhile, in Nadi, Fiji, PNA officials met for a chat that could be the start of something futuristic in the game of trading fishing days. The PNA Vessel Day Scheme has been operating now for many years, increasing government revenue from a meager $60 million in 2010 to a whopping $300 million today. Can this go any further? And how? Well that’s what PNA officials are looking at in their closed meeting.

According to PNA CEO Dr Transform Aqorau, talking to Radio New Zealand International: “Here is a group of countries that has decided to pool their days for 2015, they've actually issued invitations for companies to tender for their days and they'll be meeting in Nadi to look at the tenders. I think I won't be surprised if in the next 12-24 months you will see individual countries running their own auctions, doing electronic trading, auctioning, tendering of days and maybe even having like a little trading house for days.”

PNA Ministers head to Tuvalu in November to discuss these important issues and iron out outstanding issues on the negotiating table.

The year 2014 may yet end on a high note.

ABOUT TUNA MARKET INTELLIGENCE
Tuna Market Intelligence is an independent publication, sponsored by the Parties to the Nauru Agreement (PNA) to unearth industry and market information from Pacific Island reporters and analysts. Reprint in the media from the PNA countries is free. All other reprints must be authorized. Contact us on marketintel@pnatuna.com or see more on www.pnatuna.com/Tuna-Market-Intelligence

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