The Price of Fish

by Mike Crowe

David Goethel at NEFMC meeting, Portland, Maine. Goethel has been fishing since 1967. He has been a member of the NEFMC  and an outspoken critic of management  policies which have driven fishermen out of business. © Photo by Sam Murfitt

Fishermen fishing off New Hampshire are reporting having to pay more than the landed value for quota in their sector. While it is not true across all species it is for some species like cod, yellow tail, haddock and grey sole. As a result the asking price for all other species are well above what will bring a living profit margin.

Owning fish that are still in the ocean and someone else paying for those fish before they are caught is the federal management policy now in place.

It has some fishermen charging that it’s the magic hand of the manipulated market sticking it to the fishermen willing to try to make a living.

New Hampshire fisherman and long time New England Fisheries Management Council member Dave Goethel said, “A handful of people hold the permits that entitle them to quota. They put their quota on the sector market for whatever price they want. It can and often does have nothing to do with what the landed value is.” The result is fishermen often can’t buy the quota or they do and the profit margins are too narrow to make a profit.

If unsold after seven days, under sector rules, that quota can be taken to any market outside that sector and sold. When quota is sold, said Goethel, the next permit holder with quota thinks they can get more per pound.

In response to a letter from Goethel, NMFS regional administrator John Bullard said there was nothing NMFS could do about this under the Magnuson Stevens Act, said Goethel. However, Goethel said he was looking at the broader view and cited the Economic Stabilization Act of 1970. Put in place during a period of high inflation, which included speculation in petroleum fuels, this act gives the government broad authority to prevent excess profiteering in the marketplace.

The story of how fishing went from the ancient tradition of investing money and time in a boat, and having the courage and skill to go to sea with hope of profiting to where it is now more like sharecropping was foretold by fishermen during Amendment 5 proceedings in 1994.

At that time a permit policy was instituted. The federal government issued a fixed number of permits in the northeast region – about 1900 permits. Commercial fishermen could then fish only if they held a permit. Anyone with any kind of a receipt that stated they had caught more than one pound of fish in the last year was granted a permit. This included buying a receipt book at Walmart and filling out a receipt for yourself and handing it in.

Two years later during Amendment 7 the days at sea policy was added. Under Days At Sea the options were to either take any 88 days to fish in a given year or get a number of days to fish based on an individual’s fishing history and stay in port 1 day for every day out fishing. For those with some information about what was evolving at the regional council meetings back then, this was a time to fish as many days as possible to build history for the coming judgement day. Fish as much as possible is what some did.

A permit with 360 days on it would get 180 fishing days. Later when regional quota was divided among permit holders, as it is in the sector system now, 180 days equaled a lot of quota. Now that quota can be brought ashore with a telephone. There no longer needs to be a boat attached to a permit. With no need to own, maintain, fuel and crew a vessel, potential permit owner profits on quota have soared. The fishery has been privatized one cut at a time said Goethel.

Port Clyde, Maine fisherman Glen Libby, also a former NEFMC member and managing partner in the Mid Coast Fishermen’s Association noting the price of quota said, “It can be tight, it (the cost of quota) cuts into profits.” He said the profit margins can be very thin and there is no guarantee the fish caught will be sold at all.

Libby said the State fo Maine permit bank prices had been low, but that that is about to change. The state is issuing bonds to raise money to buy permits to increase its cash flow. Libby said the permit bank is not supposed to be making money for the state, it is there as support for economic development of the fish business. Libby said he hopes that if quotas increase there will be less need for some fishermen who have quota to lease more quota to make ends meet.

The questions asked back in 1994 and that some continue to ask today are what did the federal fisheries management system (NMFS) know about plans to privatize federal fisheries and when did they know it?

Some fishermen have said that from the very beginning the actions taken by managers was seen to be leading to privatization. Fishermen have accused federal managers of driving out fishermen to have fewer to manage and to open the way for privatization.

If this was a federal mandate no evidence of an official policy has been found. However, critics cite the more evident effects of the growing influence of lobbying groups at council meetings over the years. Groups with environment tags and deep pockets who sought closures, quota cuts and bans on gear types that chipped away at the number of fishermen who could afford to continue fishing.

The effect of this has been the consolidation of fishing permits - the currency of the industry.

One of these groups, the Environmental Defense Fund (EDF) openly promoted privatization and the commodification of the fish stocks to prospective investors. Prospective investors who, it was speculated, could have already been investing in the possibility of privatization via contributions to EDF.

As the recent New England quota cuts strangle the fishing industry here, the national Magnuson Stevens Fishery Management and Conservation Act is under consideration for reauthorization. Fishermen are asking whether the MSA, whose stated goal has been to protect fishery resources and fishing communities, can also protect them from the corporate threats that clearly would take both of these away.

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