Challenges and strategies for the Alaska salmon industry: Hard times have hit today's salmon fisheries. Now seems to be the right time to review how fisheries are managed.

• Author: Knapp, Gunnar

Alaska's salmon industry is in an economic crisis. Between 1990 and 2001, the wholesale value of Alaska salmon production fell by almost $400 million--almost 40 percent. Most of that loss in value came out of fishermen's earnings. This year, Alaska salmon fishermen earned less than one-third of what they did in 1990.

The drop in salmon value has far-reaching effects for salmon fishermen, processors and coastal economies. Salmon fishermen are finding it increasingly difficult to hire crew willing to work for a share of declining catch values. Many fishermen cannot make payments for their boat and permit loans. The values of salmon limited-entry permits have fallen drastically. For example, Bristol Bay salmon permits, which sold for more than $200,000 in 1990, were sold for less than $20,000 this year.

Processors' margins have also been squeezed. Some processors have gone bankrupt and many processing plants have been closed. Businesses that supply the salmon industry--from air and water transportation to net and engine repair--have suffered as fishermen and processors have cut back on spending. State and local fisheries' business taxes, as well as hatchery and marketing assessments, have fallen in proportion to the decline in harvest value on which they are based. The drop in salmon value affects tens of thousands of Alaskans who work in or directly depend upon the salmon industry.

How can we turn things around for the Alaska salmon industry? How can we make salmon fishing and processing profitable again--and a stable source of income, jobs, opportunity and pride for Alaska's coastal communities and young people?

There is no single answer to these questions. Alaska's salmon industry is very diverse, which makes it hard to generalize about the challenges the industry is facing or what to do about them. We have 27 different salmon fisheries that differ widely in species caught, types of gear used, value of catches, number of permit holders, and average earnings and permit values. We harvest five different species of salmon (sockeye, pink, chum, coho and chinook) from which we produce four major product forms (frozen, fresh, canned and roe) which are sold into three major end-markets (the United States, Japan and Europe). Market trends vary--sometimes widely--for each product of each species in each end-market.

In Alaska's fresh and frozen salmon markets--about 60 percent of total Alaska production--the biggest challenge is competition from farmed salmon. Between 1980 and 2000, farmed salmon grew from less than 1...