Alaska's finicky fish forecast.

• Author: Gay, Joel
• Position: Industry Overview

The state's commercial fishermen batten down their hatches to combat tough economic times.

After a decade of unprecedented growth and prosperity, Alaska's commercial fishing industry has entered a new and uncomfortable phase, marked not by easy money and Maui vacations, but by fierce market competition abroad and slimmer wages at home.

1994 promises more of the same and will require some sectors of the business -- from the small-boat coastal fleet to Seattle-based factory vessels -- to tighten their belts. Even as the cost of fishing rises, prices for most seafood products are static or falling, which could make this a year of consolidation, bankruptcy and foreclosure.

But weak markets and poor runs are no strangers to Alaska fishermen. Most will survive this down cycle as their forebears have done for more than a century, and those who emerge from the financial storms of the 1990s will be rewarded when markets swing back, as they must.

In hindsight, the 1980s now appear the best of times for the backbone of the Alaska fishing industry, the state's 10,000 fishermen. Runs were strong then and, because the Japanese economy was burning white-hot, demand for fish products soared. As a result, seafood prices rose to stratospheric levels, topping out in 1988. A single Cook Inlet sockeye that year fetched more than $20, and salmon fishermen earned nearly $800 million statewide.

Nothing lasts forever, though. Prices began tumbling shortly thereafter, and the downward spiral hasn't stopped. Last summer's total catch brought in less than $400 million. That same Cook Inlet red was worth just $5, and next year it could be worth even less, thanks to three major factors: continued record-breaking production, competition from farmed salmon, and consumers' changing tastes.

Alaska has some of the biggest salmon runs in the world, but the statewide harvest topped 100 million fish only six times from 1878 to 1978. In the last 14 years, however, that mark was beaten 13 times. Record high catches were logged in seven of the last 11 seasons, and last year contributed to the market glut with yet another record, a phenomenal 192 million pinks, reds, cohos, chums and kings. Next year will offer no respite from the flood. Preliminary predictions by the Alaska Department of Fish and Game (ADF&G) suggest a harvest of nearly 170 million fish.

The second factor keeping prices down is competition. Salmon farming has boomed in Norway, Chile, Canada and elsewhere as farmers refined their technology and found ready markets for their product --...