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Peanut Hole replaces Donut Hole as favorite target of exploitation.

They've closed the Donut Hole, but 60 to 70 trawlers from China, Korea and Poland are now stripping the Peanut Hole of all the pollock they can find - an estimated 400,000 to 800,000 tons a year.

At press time, a January meeting had been scheduled for the future of the Peanut Hole, which is entirely surrounded by the Russian EEZ (Exclusive Economic Zone) in the Sea of Okhotsk. Up to now, Peter Sandvig told the International Seafood Conference, the Russians haven't objected to foreign trawling operations there.

The Donut Hole, nestled between the Russian and American EEZS in the Bering Sea, was closed to trawling last August under a voluntary agreement between the United States, Russia, Japan, China, Korea and Poland. Catches there had dropped precipitously after hitting a peak of 1.447 million tons in 1989 (up from 182,000 in 1984), and it seemed that operations in the Donut Hole were decimating the whole Bering Sea stock.

Closing the Peanut Hole, Sandvig said, would "certainly put a constraint on the supply of surimi and blocks, especially for the European market." But there will be strong political pressure to do so, "if the Russians can prove that the foreign fishing is hurting their stocks." Chinese and Polish vessels are producing mostly pollock blocks and minced pollock there; one Chinese vessel has a surimi plant on board. Korean vessels are producing surimi plus whole round pollock for the domestic Korean market.

Whatever is happening in the Sea of Okhotsk, however, "the groundfish resource in the Bering Sea is very healthy," he said. "You must understand that we have one of the best-documented fisheries in the world. All factory trawlers have NMFS (National Marine Fisheries Service) observers on board, documenting catch, discards, prohibited species, etc. The U.S. Coast Guard has periodic boardings where they review ships' logs and look for prohibited species evidence and other possible violations. This is not an honor system like in the North Atlantic."

With limited fishing during the roe season and closure of the Donut Hole, he went on, "it is safe to hope that the resource will make a sustained comeback." Allowance Biological Catches (ABC) for 1993, established by the North Pacific Fisheries Management Council (NPFMC), are expected to be about the same as for 1992 - meaning around 1.3 million tons for pollock. Of this, 15% is slated to be set aside as reserves," with half of that going to community development quotas for coastal villages (although the details are still vague). Of the 1.1 million tons available to commercial fishing operations, 375,700 can be caught during the roe season (set to open Jan. 18), and 729,300 tons during the B season starting (Sandvig expects,) July 1 - a month later than usual. From both seasons, 35% of the catch will be reserved for shoreside processors as opposed to factory trawlers.

"Market forces will dictate a change in the product form we produce from pollock in 1993," Sandvig predicted. "Surimi prices have been on a steady decline ever since [early 1992], and as you all know, block prices have been rising. There are many reasons for these wild price fluctuations, including eating habits, expanding/weakening demand, price elasticity, resource availability, alternate sourcing, inventories and product mix. Both pollock blocks and surimi have their own independent supply/demand pricing structures. Too much credit is given to one influencing the other."

Besides raw prices, blocks have the advantage of increasing the effective pollock quota, he noted. The recovery rate for surimi from raw material is 15%, whereas the recovery rate for blocks or minced pollock is 25%. If a vessel produces 50 tons of surimi, it is debited for 333 tons from its quota, whereas if it produces 50 tons of blocks, it is debited for only 200 tons. If the entire quota of 1.3 million tons were devoted to surimi, the industry would have only 195,000 tons of finished product to show for it; whereas devoting the entire quota to blocks would produce 325,000 tons. "At today's prices, that would be an increase of over $200 million to the fleet," Sandvig observed. But he quickly warned, "This is just a paper figure, because you all know what would happen to block prices if the U.S. fleet produced 350,000 tons of fillet blocks."

Don't look for block prices to fall this year, however, because much of the production (up to 20,000 tons) will be devoted to the new deepskinned pollock block market, which commands prices of $1.70 a pound, he predicted; prices will thus keep rising for ordinary skinless and boneless blocks, although margins between ordinary and deep-skinned blocks will moderate. On the other hand, the differential between twice-frozen and once-frozen is going to increase, as more twice-frozen blocks are produced. "Russian pollock production remains the wild card," he said. "If foreign and Russian-flagged vessels are allowed to fish and sell their finished products on the world market, we should see a stabilizing flow of goods and, in turn, stabilizing prices."

Regarding other species, Sandvig said that yellowfin sole has become more important to the U.S. fleet with the shortened and split pollock season. With a weak surimi market, most of the sole catch is frozen round and shipped to Southeast Asia for reprocessing into fillets (filleting facilities for such small fish are relatively lacking in Alaska). Pacific hake quota for last year was 208,000 tons, with 35% reserved for shore-side plants and most going into surimi for Japan and Korea. Cod is marketed both to Japan and to European salters, and rock sole is frozen whole and roe-in for export to Japan.

Sandvig called for reform of the Olympic quota allocation system; even a moratorium limiting fishing for three years to vessels active before last February would allow more than 13,000 vessels (almost two and a half times the 1991 record fleet of 4,963) to operate in Alaskan waters. The big challenge to the industry, meanwhile, is to lift the two million ton cap on total quotas in the Bering Sea if resource viability improves. The total ABC for all species for 1993 is expected to be 70% above that level, and 20% above the total ABC for 1992.
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Title Annotation:Donut Hole trawling area of Bering Sea closed; Peanut Hole area of Russian Sea of Okhotsk may be closed due to Russian belief that foreign fisherman are depleting its stocks
Publication:Quick Frozen Foods International
Date:Jan 1, 1993
Words:1050
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