By Terry Dillman
Record-high whole season price; outlook good for next season
Oregon’s Dungeness crab fishermen logged another good year in terms of market value. The season ended August 14th with an estimated harvest of about 14.2 million pounds and to-the-boat value of $42 million, according to preliminary figures from the Oregon Department of Agriculture and Oregon Dungeness Crab Commission (ODCC).
“The real story for this year is the overall average price for the whole season,” said Nick Furman, the ODCC executive director.
The season began with the highest opening price ever at $2.30 per pound and ended with the highest overall value ever: a record-high to-the-boat price of $2.95 per pound. In 2011, 21.2 million pounds of Dungeness crabs netted an overall value of $49 million for Oregon crabbers based on the season average of $2.30 per pound, placing the fishery in the top 20 of Oregon’s commodities.
Usually, the opening price is set for a short period, then the market takes over. This year, through negotiations mediated by the Oregon Department of Agriculture (ODA), fishermen’s associations and processors settled on the highest-ever opening price $2.30 per pound, a deal reached by agreeing to lock in that price for the first 22 days of the season rather the usual three days.
Demand for live crab in Asia, particularly China, rose higher than ever this season, with live market buyers offering as much as $1.20 more per pound than the negotiated price. Furman said fishermen never really know how high the demand for live crab in Asia might be, and since live buyers purchase far fewer crabs than processing plants, they are not a part of the opening price negotiations.
The crabbing associations have negotiated opening price with processing plants under ODA’s mediation for the past nine years in an attempt to smooth out the bargaining process and get the season off and running without crabbers striking to protest what they might consider as refusal by processors to pay a fair price.
Dungeness crabs are a major part of the Pacific Northwest’s seafood heritage, with commercial fishermen harvesting them along the Pacific coast since the late 1800s. They range from central California to the Gulf of Alaska.
The ocean crab season along the Oregon coast begins December 1st and continues through August 14th. Peak harvest occurs during the first eight weeks of the season, with up to 75 percent of the annual production landed during that time. Effort traditionally decreases in the spring as fishermen gear up for other coastal fisheries, but fresh crab is available throughout the summer as a small number of boats fish until the August closure.
The Dungeness crab fishery is naturally cyclical, depending on ocean conditions, and crabbers say they expect a drop-off in landings after a boom.
Dungeness crab is the most valuable “single-species” fishery in Oregon. “Ex-vessel” value fluctuates yearly, based on the size of the harvest and prevailing market conditions. During the most recent 10-year period, Furman said the “to-the-boat” value ranged from $5 million to $49 million dollars.
Total production for the entire region (California to Alaska) averages 42.5 million pounds annually.
The average Oregon catch is just above 10 million pounds. According to the ODCC, harvests have fluctuated from a low of 3.2 million pounds to record levels from 2003 to 2006, peaking at the 33.6 million pounds in 2004, followed by 27.5 million pounds in 2005, valued at $44.6 million.
Furman said those harvests point to “healthy stocks and a sustainable fishery.”
In 2006, the catch dropped by almost half to 15.1 million pounds worth $32.9 million. Crabbers hauled 12.3 million pounds of Dungeness crabs values at $29.3 million into Oregon ports in 2007, and 13 million pounds in 2008.
The flow of crabs from pots to docks to markets hinges on bringing in most of the annual catch during the first two months. The surge helps processors, who depend on volume to feed hungry holiday markets.
Opening price is vital to the crabbers’ livelihoods. Crabbers remain “at the mercy of” the markets, because they harvest a natural resource. Natural cycles make crab populations boom and bust, and Furman said historically high landings are both good and bad. Successive years of high yields flood the market, pinching prices and leading to holdover inventories.
Fewer crabs, more money summed up the 2010-2011 season as the 325-boat Oregon fleet hauled in 21.2 million pounds of the state’s official crustacean – the fourth largest catch on record, exceeding 20 million pounds for the fifth time in the past decade.
“The real story was the landed value of the catch,” said Furman. “Strong demand in the marketplace pushed boat prices up, so although fishermen caught fewer crabs, they made more money.”
The to-the-boat harvest value reached almost $49 million, making it the second most valuable Oregon crab season in history. Associated processing activity upped the economic impact for the state’s coastal communities from Astoria to Brookings to more than $100 million.
Analysts say strong marketing and promotion efforts have heightened the image of Dungeness crab, creating demand that is transforming it from primarily a regional favorite to a more nationwide appeal in restaurants and other seafood outlets, including supermarket chains. An industry marketing partnership with the ODA focuses on promoting Dungeness crab in as many key markets as possible, including the international marketplace.
Oregon leads the way in Dungeness production, with harvested crabs sold live, whole fresh or frozen, or as picked meat, legs and sections. Products are shipped around the world, although the United States remains the main market.
That is changing, Furman said, in part due to certification by the Marine Stewardship Council as the only one of the West Coast Dungeness crab fisheries (Oregon, Washington, California, Alaska, British Columbia) to receive the designation for its good management practices, sustainable harvest methods and neutral environmental impacts. The certification, he noted, opened up additional marketplace opportunities for what is already the state’s most valuable fishery, due to the growing trend among the retail, food service and restaurant trade to offer products from sustainable fisheries certified by an independent entity using a proven scientific process.
“This sets the Oregon Dungeness brand apart from all other Dungeness in the marketplace,” Furman said. “Oregon has been harvesting Dungeness crab for over a century. Landings this past decade have been off the charts and nature continues to provide us with healthy stocks.”
But he is also fully aware of the fishery’s natural ups and downs, and providing an outlook for the next season, the start of which is only four months away, is iffy.
The impact of the live crab market in Asia is a potential key.
“It’s hard to say,” Furman noted. “If demand continues to be strong, and Asia continues to want live Dungeness crab, it would bode well. Historically, prices and markets are like a pendulum – when it swings high, it typically swings back, and when it does, it typically comes crashing back.”
Much, of course, depends on production and harvest levels – known in marketing circles as supply and demand. If production is down, it generally drives up the price. Harvest dropped from 21.2 million pounds in 2011 to 14.2 million in 2012, but this year’s haul is still well above the average of 10 to 12 million pounds. And the 2011 harvest was a bit less than the 2010 haul of 23 million pounds.
Furman said the fishery has gone through “some phenomenal harvests” during the past decade, in which the fishery was “really at a peak” with an average haul of 18.6 million pounds.
“At this point, it’s hard to tell whether we’re going back up or back down,” he concluded. “This last decade threw us off our cycle as we know it and put us in uncharted territory as far as highs and lows.”
Furman said crabbers would consider 2012 “a good season,” and would like to see a repeat in 2013.Terry Dillman can be reached at email@example.com.