Tuna Market Intelligence - Issue 46

Issue 46, October 31, 2016

MARKET UPDATE

https://ssl.gstatic.com/ui/v1/icons/mail/images/cleardot.gifThe price of skipjack tuna on the Bangkok market remained flat at around $1400 per mt.

As reported previously, the Fish Aggregating Device (FAD) ban in PNA waters, due to end in late October, is believed to have contributed to the trend of lower prices in expectation of increased supply to Bangkok.

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INFLUENCERS REPORT

No change for Solomon Islands from American Samoa shutdowns

As suspension of canning by Trimarine was announced just as the last edition of Tuna Market Intelligence was going to press, there was no time to report on what that meant for other canners in the Pacific, including Trimarine’s other cannery in Solomon Islands.

However, it seems boats based in American Samoa are likely to continue to fish on the Eastern side of the Western and Central Pacific, and American Samoa will continue to receive this tuna. Samoa Tuna Processors, the Trimarine facility in American Samoa, will continue to receive fish for sorting, grading, holding in their cold storages and shipping to the highest value markets, mostly by container. 

Meanwhile, Solomon Islands has duty free access to the US canned tuna market (which applies a 12.5% duty) under the EBA (Everything but Arms) trade regime.  The

EBA duty exemption is also given by the EU where duty on tuna products is 24%. Trimarine stated: "These duty exemptions and savings are fundamental to the economic viability of island based tuna processors."

PNA identifies interesting FAD trends

At the PNA Special Meeting in Honiara last week, the countries discussed how to best manage fishing on Fish Aggregating Devices (FADs). The conventional wisdom was that purse seine vessels need FADs to survive, but the meeting heard that this is increasingly looking redundant. This year high levels of fishing effort during the 4-month FAD closure, and some boats leaving fisheries that are FAD-dependent seem to indicate change away from FADs. There is also the premium price for fish caught without using FADs under the Marine Stewardship Council certification of the PNA free school skipjack and yellowfin tuna fisheries.

However, the meeting also heard FADs are hot and tradable property, with recent trials indicating FADs are exchanged between and amongst fleets, and also picked up by locals from time to time (with FAD signals being detected in the mountains of Papua New Guinea for instance). Whether further PNA control of this hot property will act as a disincentive for FAD use or simply recognise and return their value back to the Pacific Islands remains to be seen. 

FAD bans cost raises ire of small nations

FADs are also a hot topic due to be discussed at this year’s Tuna Commission (WCPFC). Apart from Indonesia and Philippines, 95% of FAD sets are in PNA’s waters. The PNA’s focus has been on exploring ways to replace the current costly 4-month ban on FAD use with other measures to conserve bigeye tuna such as charging for their use. Options include charging per FAD, limiting FAD sets, setting a limit on the total number of FADs or even for the PNA to own FADs then rent or tender for their use.

The PNA Special Meeting heard that the FAD closure costs $15-20 million USD per month in terms of foregone revenue. An estimated $400 million of catch value has been lost in the FAD closures so far since they were introduced in 2009. However, the benefits of FAD measures in terms of conservation are largely enjoyed by vessels of distant water fleets fishing outside PNA waters. This is not consistent with the Western and Pacific Fisheries Convention which states there will not be a “disproportionate burden” of measures on Small Island Developing States. Tokelau and Tuvalu said they would not have a 4th month of closure after 2016 unless the burden was dealt with.

While Japan previously has supported the idea of a $1 million fund for burdened countries, it looks like such proposals are far outweighed by the actual cost to small island states of Pacific-wide FAD bans.

Trump or Clinton and politics above and below water

Not surprisingly, fisheries have not been high on the US election campaign agendas, despite the big changes afoot in the US tuna industry.

In fact, the only statements either candidate made were more personal anecdotes about how fishing was a formative experience in their youth. Donald Trump told Field and Stream magazine fishing kept him from unidentified negative activities: “For me, hunting and fishing kept me out of so much other trouble I would’ve gotten into throughout my life. It’s just so important to be able to maintain that, so that next generation gets into it.” While Hillary Clinton has talked about her “summer job” cleaning salmon. “My job was to grab them, and these are big fish, and to take a spoon and clean out the insides … best preparation for being in Washington that you can possibly imagine,” Clinton has joked previously.

More seriously, in response to a letter sent by 115 ocean leaders to the leading presidential candidates, Secretary Clinton has released a two-page response. She said, if elected she would build a blue economy, finally get US to accept and pass the United Nations Convention on the Law of the Sea, take regulatory action to ensure fish is safe, sustainable and properly identified and expand

US seafood traceability programs.

But the real politics is happening below the swirling waves of the presidential candidates – in Congress and the State Department. Whoever gets elected will likely face pressure from a beleaguered US tuna industry. Their voice is evident in a bill, the Ensuring Access to Pacific Fisheries Act, which passed Congress and is to come before the Senate. The legislation would mandate fishery industry concerns to dictate international negotiations through an Advisory Committee in ways that are designed to undermine some elements of the WCPFC Convention such as the requirement to avoid transferring a disproportionate burden of conservation action onto Small Island Developing States. The legislation states the Secretary of Commerce and Secretary of State in negotiations will “seek to

``(1) minimize any disadvantage to United States fishermen in relation to other members of the Commission;

``(2) maximize the opportunities for fishing vessels of the United States to harvest fish stocks on the high seas in the Convention area, recognizing that such harvests may be restricted if the Commission, based on the best available scientific information provided by the Scientific Committee, determines it is necessary to achieve the conservation objective set forth in Article 2 of the Convention;

``(3) prevent any requirement for the transfer to other nations or foreign entities of the fishing capacity, fishing capacity rights, or fishing vessels of the United States or its territories, unless any such requirement is voluntary and market-based; and

``(4) ensure that conservation and management measures take into consideration traditional fishing patterns of fishing vessels of the United States and the operating requirements of the fisheries covered by the Western and Central Pacific Convention.''

If passed by both houses and made into law, this would cramp the style of US government officials at international meetings, leaving little room for them to respond to non-industry concerns.  Although, this Act may not come to fruition, US conservationists are likely to be against it and Secretary of State John Kerry has previously expressed support for more, rather than less, control of fishing on the high seas.

May the best candidate win and find a way forward as the US election approaches on November 9. 

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

 

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