GMRI Marine Resource Economist Jenny Sun worked with Jessica Joyce of GMRI’s Community Team on Phase 1 of the project, to identify risk management and income enhancement options for each sector. In addition, a variety of strategies were discussed related to fee structures, sector manager’s salary and responsibilities, cost-sharing services, sector rosters, Annual Catch Entitlement (ACE) rollover, and reductions in ACE.
Phase 2 of the project was conducted from July 1, 2012 through June 30, 2013 to present sector managers and their boards of directors the profiles analysis to help inform the sectors’ business planning for the following fishing year 2013 (FY 2013). The supporting information and a simulation template is provided for each individual sector to evaluate how the membership profile, landings and leasing history, and annual catch limit reductions in FY 2013 would affect a sector’s viability. In addition, the seasonal landing patterns and market fluctuations for locally-caught fresh groundfish is analyzed in an effort to provide individual sector members with a business planning tool to help them maximize the utilization of their allocation.
Phase 3 of the project (July 1, 2013 to June 30, 2015) attempts to understand the structure and performance of the leasing market for groundfish quota traded between sectors and a predictive modeling tool that demonstrates the potential risks and opportunities for sector operations and ACE trading for each sector type. This phase also includes a dissemination process for industry and management.
The transition to annual catch allocations and communal accountability in the groundfish industry has been a difficult one. As fishermen adapt, the dialogue has shifted from whether sectors are a good management approach to how to make the system work effectively. In order to improve profitability and viability of the groundfish fleet and community, fishermen need to understand how to utilize their ACE in a cost efficient way and how to position their landings in the marketplace to maximize their value.
The business profiles allowed sectors to forecast probable operational costs and income levels as well as work out strategies to deal with budget shortfalls, declining income, and impending monitoring costs. There is a need to analyze landings value by sector, including trading and the probable monetary value of lost income through unutilized allocation or landing at inopportune times in terms of market value. These profiles provided sectors with more complete information to make informed business decisions.
GMRI plans to continue conversations with fishermen and sectors around administrative and operational efficiency. It is important to fishermen to understand how their combined landings affect price and what strategies are available to them for dealing with volatile prices—such as diversification of their landings and timing of their ACE trading. The ACE leasing and marketing strategies could help both small- and large-scale fishermen; however, the majority of the fleet is small-scale and will count on the ability of the sector to coordinate the combined landings to be successful.