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Steps for seafood prominence in the '90s.

Steps for seafood prominence in the '90s

DURING THE PAST DECADE, ALASKA WAS THE POINT man for the U.S. seafood industry, leading the nation as it wrested control of U.S. waters within the 200-mile zone from the domination of foreign fleets. With salmon as its foundation and bottomfish as its rampart, the Alaska industry has created a seafood fortress that has stood both the consumer and the industry in good stead.

It's no exaggeration to say that the 1980s posed a supplyside dream, and Alaska orchestrated that dream. Alaska fisheries production now approaches 3 billion pounds of seafood a year, worth a whopping $1.3 billion. In compiling those production figures, Alaska fishermen - whether home-grown or just visiting - proved their preeminence among their international peers.

It wasn't all that many years ago that people openly questioned the skill, knowledge and technical expertise of Alaskan fishermen. Could they take advantage of the fish stocks given by the Magnuson Act? Today, nobody even ponders the question, much less asks it out loud. U.S. fishermen, in general, and Alaska fishermen, in particular, are the leaders. Period.

But the job is far from over. As the industry enters the decade of the 1990s, challenges and opportunities face Alaska that will take a different kind of expertise. Now the challenge will be to compete successfully in an evermore competitive worldwide food industry. No longer must we think of ourselves as being in the fishing industry, or even in the seafood industry. Rather, we are now in the food industry, competing for consumers against the likes of beef and poultry. Competition from imported fish and seafood will provide another challenge.

How do we entice the consumer to eat more fish? That is the question. During the supply-side decade of the 1980s, consumers discovered the healthful benefits and good taste of fish and shellfish. Alaska fishermen and processors were leaders in providing the consumer a whole new fish menu from which to choose.

But the consumer is fickle, wary. While seafood consumption in the United States has grown from 12.8 pounds per capita in 1980 to 15 pounds per capita in 1988, further growth is far from assured. Even though the U.S. Department of Agriculture and the National Fisheries Institute predict per-capita consumption will climb to between 17 and 20 pounds by the year 2000, Alaska's seafood industry knows it is no sure thing.

Fortunately, Alaska already has the tools to lead the nation as it embarks on the voyage into the market-driven 1990s. The only question is whether those tools will be sharp enough to work in the tougher environment of the next 10 years.

One of the most important tools for the seafood industry is the Alaska Seafood Marketing Institute. Funded by an assessment on fish sales, ASMI has done a remarkable job of promoting Alaska seafood. It has earned especially good marks for its effective and intelligent damage-control measures.

When the canned salmon industry was hit with a botulism scare in the early 1980s, ASMI acted quickly and decisively to limit the long-range damage. More recently, ASMI used cool-headed restraint to reassure the seafood trade and the consumer that the quality of Alaska's fish had not been tainted by the Exxon Valdez oil spill in Prince William Sound.

Perhaps more important for the long-term health of the seafood industry is ASMI's new offensive posture, embodied in its recently approved three-year marketing plan. This strategic plan starts from a new premise for the seafood industry - the needs of the market. The new question is what does the market need, not what does Alaska need to sell. The focus of the three-year plan is to create, in effect, a brand franchise for Alaska seafood.

This doesn't mean ASMI is abandoning its more traditional single-species promotion campaigns. After all, this is the real world and some products need a boost out the door. Still, the new focus on reading the market first has the potential of producing long-term dividends for Alaska that will far outstrip the benefits of moving a particular pack in a particular year.

Getting the strategic plan approved was no easy task. The fishing and seafood industries are notoriously market-shy. ASMI's ability to work through this says much about the potential for Alaska and for the rest of the seafood industry.

And while the 1990s will be the decade of the market, production cannot be forgotten. The tool that took the industry into a leadership position during the 1980s and that will be just as necessary in the future is the Alaska Fisheries Development Foundation. However, AFDF is facing very real questions about its survival.

AFDF, like other regional fishery development foundations, is funded by federal Saltonstall-Kennedy funds each year. The task of the foundations is to provide the applied research that can make underutilized fish species viable products in the seafood marketplace. In essence, the foundations provide the fresh, innovative, new products that keep any industry alive.

It was AFDF, through its Surimi Project, that almost singlehandedly turned underutilized pollock into the booming surimi industry. With a relatively minor expenditure of $4 million to $5 million, AFDF helped launch an industry that will manufacture some 200,000 metric tons of product this year. More recently, AFDF has been concentrating on flatfish, an underutilized resource of nearly one million metric tons.

The Alaska seafood industry is going to be challenged in 1990 and beyond to have new products not only to offer to the market but to have available for the huge fleet of 50 factory trawlers and the numerous new and expanding processing plants that make up today's industry. AFDF may well be the most cost-effective way to do the practical research needed to ensure that Alaska's fishing and processing capacity is fully utilized.

There is no guarantee, however, that AFDF will be around to provide for that need. The S-K funding mechanism is failing, and all the regional fisheries development foundations, including AFDF, are threatened with financial starvation. The task facing AFDF is to find a new source of funding, perhaps a direct appropriation from the government.

In the end, it would be more than a shame, it would be a practical catastrophe, if AFDF died for lack of funding. For all the marketing expertise in the world will do no good without a product to market.
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Title Annotation:Alaska From The Outside; Alaska
Author:Talley, Ken
Publication:Alaska Business Monthly
Article Type:editorial
Date:Mar 1, 1990
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