Salmon Fishers Fuming As Prices Take Big Fall

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Category: State News

Created on Tuesday, 25 July 2023 15:08

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By Nathaniel Herz

Northern Journal

A few times this summer, Jared Danielson, who fishes for salmon on the Alaska Peninsula, found himself fighting back tears in his bunk.

Aboard the F/V Five Star, his boat, Danielson and his deckhand put away as many pounds of fish as they could. They had no breakdowns. But his seafood processor is paying him 70 cents a pound for his salmon — half of last year’s price  — which means that instead of his usual six-figure haul for a summer of hard work, he might only break even, or go home to his family in Washington with $10,000, if he’s lucky.

“I’ve done everything right,” Danielson, 36, said in an interview this week. “It’s pretty demoralizing — you take all this risk, all this sacrifice, and you go home essentially without a paycheck.”

He added: “We’re up against something that’s out of our control, and that’s the processors killing us here.”

In the past few weeks, thousands of fishermen across the state have found themselves in a similar predicament: The price they’ll be paid by the processing companies that buy their salmon won’t be enough to cover their costs — or, at least, will make them far less profit than last year.

Some fishermen, like Danielson, have known about the weak market for fish since early in the summer salmon season. But the fleet’s frustration boiled over in recent days as processors announced a minimum price of 50 cents a pound in Bristol Bay — the site of Alaska’s, and the world’s, largest wild sockeye fishery.

Last year’s average Bristol Bay sockeye price was $1.39 a pound. Prices have fallen below $1 only twice since 2009, according to the Alaska Department of Fish and Game.

Fishermen have been fuming at processors since this week’s announcements, and dozens of boats staged a floating protest Thursday on a Bristol Bay river, according to local public radio station KDLG. “Our operating costs have gone nothing but up, and yet we’re the ones who get paid less,” Bristol Bay skipper Jerry Matzen said in an interview this week. “This business would be nothing without us — absolutely nothing. So, why are we the ones who always take it in the shorts?”

But John Sackton, founder of industry publication Seafood News, said the story is more complicated than processing companies profiting by paying unreasonably low prices.

The Bristol Bay harvest, in particular, has unique features that can benefit companies at fishermen’s expense — namely, that boats often start fishing before prices are set. 

But processors have also been struggling this year, as pandemic-fueled grocery store demand for seafood gives way to the slowing global economy and a glut in Alaska salmon after last year’s record catch of 75 million sockeye, according to Sackton, a longtime industry analyst.

Processors typically don’t sell fish directly to consumers; they sell at wholesale prices to commodity brokers, or restaurants and chains like Costco, which make their own decisions about the prices they’ll charge.

“The reason the processors are being aggressive on price is because they got hit hard with losses they didn’t expect on salmon,” Sackton said. “The warehouses and the freezer space were full of unsold products. When there was a slowdown in the velocity of sales, the harvesters and the processors were left with the short end of the stick.”

This year’s feuding over seafood prices is not limited to Alaska. 

In eastern Canada, prices crab fishermen received collapsed this year, and were less than one-third of 2022 prices. Fishermen went on strike for weeks this spring, and the provincial premier had to intervene to help strike a deal with processors, who only agreed to make their initial offer the minimum price.

And in Alaska, salmon fishermen’s woes are not limited to Bristol Bay.

Danielson, who uses a drift gillnet to fish for salmon in a region of the Alaska Peninsula called Area M, said he will likely end his season early because of the low price he’s being paid.

Another gillnetter in the same area, Cody Trader, sent a statement on behalf of several fishermen that said this year’s prices would send a “significant portion” of the region’s fleet into forced sale or bankruptcy.

Deckhands are quitting early, forcing some skippers to stop fishing, Danielson said. 

“A lot of these crew, they’re probably thinking, ‘Why am I up here? I could probably be making more money working at McDonald’s at home,’” he said.

In the Copper River and Prince William Sound gillnet fisheries, captain Patrick McCormick said he was getting at least $2.50 a pound for sockeye last year. This year, he said, most processors are paying $1.

“It is, quite frankly, unbelievable that the price of salmon would be that low compared to last year, especially when it is more expensive than ever in the store,” McCormick wrote in an email. He added: “I am not sure who is making the money, but it isn’t us.”

Sackton said there’s a clear explanation for why grocers’ salmon prices have remained high, even if fishermen are earning far less. Retail sellers, he said, would rather maintain high profit margins then sell more seafood at lower prices.

“This is very bad news for harvesters and processors, because we depend on the volume that we produce moving through the market,” he said.

Processors, Sackton added, “got screwed by the retailers.” 

“They were left holding the bag, because retail customers who were going to take that fish off their hands never materialized,” he said.

One processing company official, speaking anonymously, said nearly the same thing as McCormick: “There’s clearly someone benefiting. It’s just not us.”

Representatives for two of Alaska’s largest processors, Trident Seafoods and Silver Bay Seafoods, declined to comment.

But in its letter to fishermen announcing its Bristol Bay prices this week, Trident asked for their trust “that the price put forward directly reflects where the sockeye market has landed.” 

The company also promised that if it gets higher-than-expected prices for the 2023 harvest, it would share that “upside” through retroactive payments — a standard fishing industry practice.

In explaining its prices — which include bonuses above the 50-cent base for chilling and bleeding fish — Trident cited market trends such as high inventories, falling demand, inflation and even low-priced Russian salmon being sold to finance the country’s war in Ukraine.

Many fishermen, however, don’t accept those explanations. Facebook groups, in recent days, have lit up with posts by Bristol Bay fishermen calling for strikes, lawsuits and “picket signs and pitchforks.”

One emerging theme is that Bristol Bay fishermen want price information from processors sooner, since skippers typically spend weeks or months preparing their boats and invest thousands of dollars in supplies and airfare before knowing how much their catch will bring. 

“Every other fishery, we have a set price,” said Matzen, the Bristol Bay skipper. “We need to find out the price prior to us putting the net in the water — we need a price a couple months in advance of us coming up.”

Other fishermen say Bristol Bay salmon aren’t always the highest quality. Boats harvest in huge quantities, and when fish holds fill up, sometimes the catch has to sit on deck, unrefrigerated, before it’s delivered to processors.

Sackton, the analyst, said it’s not unreasonable for fishermen, who only sell salmon for a brief summer season, to be surprised and angry about this year’s crash in prices. 

Given this summer’s circumstances, he added, they can push for more transparency from processors — and from government agencies — about the wholesale prices they get for seafood, and for postseason price adjustments if sales merit them.

But another way to look at it, Sackton added, is that a “cooperative approach” with processors to maximize salmon’s value would benefit the whole industry.

Fishermen, he said, “can’t focus their anger on the processors without asking the question of how to better market their fish and better their value,” he said. “Everybody benefits,” he said, when the price paid to fishermen is “as high a price as possible.”

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Nathaniel Herz welcomes tips at This email address is being protected from spambots. You need JavaScript enabled to view it. or (907) 793-0312. This article was originally published in Northern Journal, a newsletter from Herz.

DOD Boosts Nome-Area Graphite Mining Project

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Category: State News

Created on Tuesday, 18 July 2023 15:29

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By Yereth Rosen

Alaska Beacon

The U.S. Department of Defense has awarded a $37.5 million grant to boost an Alaska mine project that would produce a mineral deemed critical to electronics and batteries: graphite.

The award is to go to Graphite One Inc., a Vancouver-based company seeking to develop a mine about 37 miles north of Nome, the department said on Monday.

The grant is intended to help Graphite One complete its economic feasibility study more quickly. It was made through a department office focused on expanding manufacturing capability.

Graphite – well-known for its use in ordinary pencils — is considered a critical mineral because it is used in high-temperature lubricants, brushes for electrical motors, friction materials and battery and fuel cells, according to the U.S. Geological Survey.

The Graphite Creek deposit that Graphite One is seeking to develop is, by far, the largest of 10 identified significant graphite deposits in the nation, according to the USGS. The U.S. has not produced any domestic graphite since the 1950s and depends entirely on imports, mostly from China, Mexico and Canada, according to the USGS.

Helping Graphite One advance its project is in the national interest, the Department of Defense said in a statement.

“This investment to increase domestic capabilities for graphite exemplifies Industrial Base Policy’s commitment to building a resilient industrial base to meet current and future national defense requirements,” Dr. Laura Taylor-Kale, Assistant Secretary of Defense for Industrial Base Policy, said in the statement. “The agreement with Graphite One (Alaska) advances the Defense Department’s strategy for minerals and materials related to large-capacity batteries.”

Graphite One’s chief executive officer said the company plans to start the accelerated feasibility study “immediately.”

“This Department of Defense grant underscores our confidence in our strategy to build a 100% U.S.-based advanced graphite supply chain — from mining to refining to recycling. The U.S. simply cannot maintain a 21st Century tech-driven economy without Critical Minerals like graphite,” Anthony Huston, founder and CEO of Graphite One Inc., said in the Department of Defense statement.

The Graphite One mine, if developed, would use an expanded Port of Nome as a shipping and staging site.

Money for the grant comes from the Inflation Reduction Act of 2022, a bill passed with only Democratic votes.

Graphite production is not new to Graphite Creek. It was the site of a small-scale graphite mining operation about a century ago. Claims were first staked in 1900, according to the USGS. A small amount of flaked graphite was mined in the early part of the 20th century, a few hundred tons at most, before mining there ceased after about 1917, according to the USGS.  

Graphite One’s proposed project would dwarf any past mining efforts. The company’s pre-feasibility report issued last year outlines a 26-year mine producing 75,026 metric tons of graphite products annually. The project would have to be of substantial size to attract customers and be economically worthwhile to develop, company officials told Nome residents in April.

In the Nome area, some officials and residents welcome the mine development, while others have expressed concerns about a planned access road and effects on subsistence users and resources. Graphite One officials have made multiple public presentations to update communities on the mine progress and address concerns.

Gov. Mike Dunleavy, in a statement, welcomed the grant.

“Thank you to the Department of Defense for recognizing the importance of Alaska’s vast mineral wealth, one example being Graphite One,” Dunleavy said in the statement.

Dunleavy, along with other Republicans, opposed the Inflation Reduction Act when it was being debated and criticized it, characterizing it as unleashing too much government spending. “When you spend more money in an inflationary period, it’s difficult to understand how you reduce inflation,” he said in a Bloomberg TV interview last August.

On-site work continues at Graphite Creek. A spokesperson for Graphite One said that as of Monday, there were 53 workers at the site, three drill rigs operating and environmental and geotechnical studies ongoing.

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https://alaskabeacon.com/yereth-rosen