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Fish, Markets, and Fishermen
The Economics of Overfishing
By Suzanne Iudicello, Michael Weber, Robert Wieland
ISLAND PRESSCopyright © 1999 Island Press
All rights reserved.
Not Enough Fish in the Sea
Until recently, in the balance between productivity of fish populations and people's ability to catch fish, the fish were favored. Although fishing did deplete some fish populations before World War II, most of them survived the rudimentary technology of the times. Cotton nets, hand lines, coastal vessels with short ranges, and the individual fisherman's eyesight, experience, and fish-finding capability circumscribed fishing capacity. This balance changed rapidly, however, as innovations triggered by research and development for the war effort were introduced into fishing fleets. Fiberglass for lighter and cheaper hulls, synthetic line for larger and lighter nets, diesel engines, and electronic gear for locating productive fishing grounds suddenly increased fishermen's ability to find and catch fish.
Innovations in processing, transport, and marketing of fish increased its availability in some countries. These innovations, together with rising human populations and affluence in western Europe, the United States, and Japan especially, increased demand. Whether motivated by dreams of riches or dreams of feeding the world's poor with cheap protein, governments and businesses invested in more and larger fishing vessels and infrastructure to tap seemingly inexhaustible fish populations.
Now, in many fisheries around the world, fishing fleets are far larger than is necessary to catch the amount of fish that fish populations can produce over the long run. This imbalance has already caused economic and ecological dislocation in some of the world's premier fisheries, such as the groundfish fishery off New England and Newfoundland.
Trends in World Fisheries
Far from being a local affair, fishing is a global business that generates billions of dollars in trade and fuels economic development in several countries. Since World War II, landings of marine fish and shellfish have grown worldwide, from 16.3 million metric tons in 1950 to 91. million metric tons in 1995 (FISHSTAT 1997) (see figure 1.1). Between 1950 and 1976, when the United States and many other countries extended their fishery jurisdiction to 200 nautical miles3 offshore, landings grew at an annual average rate of 5 percent (see figure 1.2). The rate of growth in landings declined to 1.7 percent in the 1970s and then grew to 3.6 percent in the 1980s (Garcia and Newton 1997). Landings peaked at 86.4 million metric tons in 1989 and then fell for only the third time since 1950 (FISHSTAT 1997).
Since 1950, pelagic (open ocean) species such as sardines, tuna, and mackerels have dominated world landings, accounting for more than 60 percent of the world catch in 1994 (Grainger and Garcia 1996). The importance of pelagic species in landings varies among regions. For instance, in the Pacific Ocean, pelagic species have accounted for as much as 59 percent of the catch, whereas in the Indian Ocean, they account for less than half. The decline in the Peruvian anchoveta in 1970 largely explains the slowing in the rate of growth in landings during this period.
Many pelagic fish populations undergo large, decade-long shifts in abundance over entire ocean basins. These fluctuations are thought to be climate-driven and account for the ups and downs in overall landings. For example, a dramatic decline in populations of Peruvian anchoveta in the early 1970s largely explains the decline in the rate of growth in landings during that period (Garcia and Newton 1997). Similarly, a decline in South American and Japanese pilchard accounts for much of the decline in worldwide landings in the early 1990s.
The other main group of fishes are demersal fishes, that is, species associated with the ocean bottom. This group, which includes most of the higher-value fishes, accounted for half the value of world landings in 1993, compared with 40 percent for pelagic species (Grainger and Garcia 1996). A decline in demersal species such as cod and haddock in the northwestern Atlantic Ocean contributed to a slower growth rate in world landings in the 1980s (Garcia and Newton 1997). From 1970 to 1992, landings of the four principal demersal species—Atlantic cod, silver hake, haddock, and Cape hake—declined by 67 percent, from 5.0 million metric tons to 1.6 million metric tons.
This period also saw a dramatic increase in international trade in fish products. Between 1950 and 1980, the percentage of fish landings that entered international trade rose from 20 percent to 33 percent (OECD 1997). Between 1980 and 1993, the value of traded fish products rose from $2.9 billion to nearly $40 billion (OECD 1997). The deficit in trade among developed countries, which accounted for 85 percent of imports by value, grew from $700 million in 1969 to about $15 billion in 1990 (Garcia and Newton 1997). Of the developed countries, only the United States decreased imports, entirely as a result of its declaration of a 200-nautical-mile fishery zone off its shores, which includes the enormous Alaska groundfish fishery.
Developing countries increased their share of exports from 32 percent in 1969 to 44 percent in 1990 while keeping their imports below 13 percent of world trade (Garcia and Newton 1997). As a result, these countries increased their positive trade balance from $500 million to $10.6 billion. In many developing countries, high-value species such as shrimp and tuna are exported and lower-value species enter local and national markets.
Roughly 60 percent of world fish landings are destined for direct human consumption; the balance is processed, principally into fish meal and fish oil (FISHSTAT 1997; OECD 1997). Between 1950 and 1982, the percentage of catch distributed fresh fell from nearly half to 20 percent (OECD 1997). Improvements in freezing techniques led to slightly more than a fourfold increase in the percentage of fish that entered markets frozen, from 5 percent to 22 percent.
Real prices of fish rose after 1970, fell slightly in the early 1980s, and then rose again slightly (OECD 1997). By 1994, the average price per ton ranged from $235 for herring, sardines, and anchovies to $11,800 for lobster. As a group, the price of cod, hake, and haddock rose from $700 per ton in 1989 to $1,060 per ton in 1994, reflecting declines in abundance of these groundfishes. Prices of other species declined. Most dramatically, the price of salmon and trout fell from $3,500 per ton to $2,750 per ton between 1989 and 1994. An increase in salmon farming explains most of this price decline. By 1995, salmon farms in Norway, Chile, Scotland, and other countries were producing about one-third of the salmon entering the market.
Leading Fishing Countries
Several factors contributed to a shuffling of the leading fishing countries in the late 1980s. The fall of the Soviet Union and the consequent loss of state subsidies caused many ocean-roving vessels of the former Soviet Union to tie up at docks. Rising labor costs, among other things, caused Japan's government and fishing industry to move from depending on domestic fleets for supplies to using fleets from other countries, particularly Taiwan and Korea (Weber 1997a). Recovery of the Peruvian anchoveta renewed Peru's fisheries.
The need of developing countries to generate foreign exchange also contributed to changes in the top fishing countries. Of the top ten fishing countries in 1995, six—China, Peru, Chile, India, Indonesia, and Thailand—were developing countries. One other country, the Russian Federation, was classified as an economy in transition. Japan and the United States ranked fourth and fifth, after China, Peru, and Chile.
With the exception of Peru, developing countries have shown dramatic and steady increases in landings of marine fish and shellfish. Between 1977 and 1995, Chile increased its landings from 1.3 million metric tons to 7.5 million metric tons, and India increased its landings from 1.4 million metric tons to 2.7 million metric tons. During the same period, marine production by Indonesia grew from 1.2 million metric tons to 3.3 million metric tons and Thai production grew from 2.0 million metric tons to 3.1 million metric tons (FISHSTAT 1998).
In 1995, China dominated world production of marine fish and shellfish, accounting for 13.5 million metric tons, or nearly 15 percent of the world total (see table 1.1). By comparison, China ranked sixth in 1986, producing just 4.5 million metric tons. China's meteoric increase in fish production reflects a government program to increase production to 20 million metric tons by the year 2000 (Milazzo 1997). This ambitious program is aimed at securing food for China's growing population and generating foreign exchange. Between 1986 and 1995, China increased its exports of fish products from less than $500 million to nearly $2.9 billion (see figure 1.3).
In the late 1980s and the 1990s, Peru's landings rose rapidly as the anchoveta fishery recovered from record lows associated with overfishing and an intense El Niño in the early 1970s and early 1980s. In 1995, Peruvian fishers landed 8.9 million metric tons of fish, up from a low of 1.5 million metric tons in 1984. Peru's exports of fish products, largely fish meal, grew from $258 million in 1986 to $870 million in 1995 (see figure 1.4).
Chilean landings have risen steadily since the early 1970s, reaching a peak of 7.8 million metric tons in 1994. In 1995, Chile ranked third worldwide, with landings of 7.5 million metric tons. Chile's landings, like those of Peru, are dominated by small pelagic species, including mackerel and anchovies. Both Chile and Peru are relatively minor consumers of fish and export most of what they catch. In Chile's case, exports have grown in recent years, particularly as a result of production of Atlantic and Pacific salmon on farms; salmon farming grew from about 4,000 metric tons in 1986 to more than 150,000 metric tons in 1995 (AQUACULT 1997). During the same period, the value of Chile's exports grew from $515 million to $1.7 billion (see figure 1.5).
In the mid-1980s, when Japanese landings peaked at 11.7 million metric tons, coastal countries from the United States to the small islands of the Pacific began closing their waters to foreign fishing vessels. What had been a free resource for Japan's wide-ranging fishing fleets began carrying a cost imposed as access fees (Weber 1997a). Japanese processors began obtaining fish from other countries, especially Taiwan and Korea. Japanese landings began a steady decline in 1989, reaching a low of 6.5 million metric tons in 1995. During the same period, the value of Japanese imports rose from $10.1 billion to $17.8 billion (FISHCOMM 1997).
Unlike Japan, which lost free access to waters around the world, the United States gained exclusive access to one of the world's largest fisheries—Alaska groundfish. After 1977, when the United States declared a 200-nautical-mile fishery zone around its shores, U.S. landings grew, from 2.9 million metric tons that year to 5.3 million metric tons in 1995. Still, the United States remained a net importer of fish. Imports of marine fish rose gradually from the mid-1980s to the mid-1990s, reaching $7.1 billion in 1995, compared with $3.4 billion in exports (see figure 1.6).
In assessing the sustainability of fisheries, fishery scientists and managers measure ability to catch fish in terms of fishing effort. In turn, fishing effort is often expressed as "number of days fished" or as size of vessel, such as gross tonnage. However, because fishing technology changes constantly, these measures offer an imperfect estimate of changes in fishing capacity. For instance, a twenty-foot dory powered by an outboard motor has greater fishing capacity than would the same dory powered by sail. Similarly, one fishing day by a trawler outfitted with a fish finder is greater than one fishing day by a trawler without one.
As it stands now, however, managers must make do with statistics on number and size of vessels when assessing trends in ability to catch fish. However, accurate statistics on fishing vessels are difficult to obtain. For instance, in 1992, Lloyd's Register of Shipping listed 24,400 fishing vessels of at least 100 gross registered tons (grt) (generally considered the industrial fleet), whereas the FAO Bulletin of Fishery Fleet Statistics included 38,400 fishing vessels of this size (Garcia and Newton 1997). According to the Food and Agriculture Organization of the United Nations (FAO), fishers around the world use another 3.4 million vessels weighing less than 100 grt.
FAO statistics indicate that the total tonnage of the world's industrial fishing fleet increased by 4.6 percent per year from 1970 through 1989, moving from 13.6 million grt to 25.3 million grt (Garcia and Newton 1997). Fleets of developing countries grew especially rapidly, from 27 percent of the total number of fishing vessels to 58 percent. Measured in tonnage, fleets of developing countries increased their share of the world total from 13 percent to 29 percent.
On a global scale, expansion of fleet capacity has seemed to make economic sense. S. M. Garcia and C. Newton (1997) compared fleet size, landings, and value of landings per grt of fleet capacity for the years 1970, 1978, and 1989. Although overall fleet size grew by 87 percent, landings grew by only 46 percent. As a result, by the early 1980s, the world's fishing fleets as a whole were an estimated 30 percent larger than necessary to catch the maximum sustainable yield of the world's fish populations (McGuinn 1998).
This general trend toward overcapacity is reflected in individual fisheries, of course. For example, a 1991 study conducted for the Gulf of Mexico Fishery Management Council concluded that the area's offshore shrimp trawl fleet was twice its optimum size (Upton, Hoar, and Upton 1992).
Stagnating landings did not lead to decreased revenues, however. Lower supply and increasing demand raised prices so that revenue per grt actually increased from $2,100 to $2,300 (Garcia and Newton 1997). Higher prices contributed to continued, although slower, rates of increase in size and technological sophistication of fishing fleets in the 1990s (McGuinn 1998).
Status of Stocks
The difficulty and expense of studying populations of fish over large areas, together with the relatively low priority given to fisheries in scientific and government circles, has prevented assessment of many stocks of fish and shellfish in the United States and around the world. In some areas, such as the northwestern Pacific, more than half of the stocks cannot be assessed (Garcia and Newton 1997).
Nevertheless, in a recent review of 200 major fish stocks around the world, the Food and Agriculture Organization of the United Nations concluded that 35 percent of stocks showed declining yields, 25 percent had plateaued, and 40 percent were still developing (FAO 1997). As Garcia and Newton (1997) have noted, these assessments suggest there is little room for growth in landings. Indeed, they suggest that the percentage of stocks showing declining yields will increase if traditional fishing practices and management persist, for several reasons. First, so little is known about most stocks of fish that calculation of a maximum sustainable yield—a common objective of fisheries management—is highly uncertain. Second, maximum sustainable yield does not reflect a precautionary approach to managing many species of fish. Finally, as fishing fleets and fisheries grow, they develop an inertia that is difficult to deflect in response to declining yields. As a result, Garcia and Newton suggest, today's fully exploited fisheries are likely to be tomorrow's overexploited fisheries.
Excerpted from Fish, Markets, and Fishermen by Suzanne Iudicello, Michael Weber, Robert Wieland. Copyright © 1999 Island Press. Excerpted by permission of ISLAND PRESS.
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