Despite a successful Alaska pollock "A" season, US harvesters are looking to lesser-known Pacific hake, or whiting, to help them meet the global demand for whitefish this year.
Pacific hake is expected to be in high demand, driven by record high prices for Alaska pollock resulting from Russia's invasion of Ukraine and the strain it is inflicting on an already tapped-out pollock supply chain.
One executive with a vessel targeting both Alaska pollock and Pacific hake told IntraFish that with the strong global demand for whitefish, hake fillet blocks are rising in importance for the group this season.
"It makes great sense to try to optimize our overall throughput and revenue by taking advantage of whiting as much as we can in addition to pollock," he told IntraFish.
The Pacific hake fishery, which opens May 15, takes place off the coasts of Washington and Oregon, and the fishery operates typically across two seasons: summer and into the fall.
The fishery produces fillet blocks and some headed and gutted (H&G) product, but the mainstay is surimi production.
Whiting is a less expensive substitute for Alaska pollock and is sometimes even combined with pollock to produce various surimi products considered to have a slightly lower quality than 100-percent pollock products, but also deliver a price point that can be more palatable to buyers in tight markets such as this year.
Higher TAC, more workers make for rosier outlook
The commercial allocation for whiting was set higher for the 2022 season, with the proposed harvest guideline up 14.8 percent from last year.
The US allocation of the TAC is set at 402,646 metric tons for the 2022 season, up 9 percent from last year.
The increase is welcomed, the executive said, noting that Alaska pollock TAC decreased by 19 percent this year.
"It gives us more reason and opportunity to take as much advantage of the hake catch limit as possible," he said.
While fishing conditions were good last year, processors were challenged by small crews due to the pandemic, the source added.
"Our throughput was limited more by our ability to move fish through the factory than by fishing conditions," he said. "Things are looking better, We had a strong hiring season for pollock "A" season, and we’re much more back to normal in terms of crew size."
The major seafood companies operating in the fishery include American Seafoods, Arctic Storm, Glacier Fish, Aleutian Spray Fisheries, Phoenix Processor Limited Partnership and Trident Seafoods.
Impact of Russia war looms
The majority of Pacific whiting is exported to Europe, with Ukraine the largest direct importer.
It has been nearly two months since Russian military forces invaded Ukraine, and since then international traders, governments and companies have been forced to examine their consciences regarding their dealings with Russia.
What has followed has been a steady drip of global seafood retailers, exporters and importers pausing, for now, many of their business transactions with Russia.
"The mystery is the impact of the Ukraine/Russia invasion, as Ukraine has been a very strong market for the whiting industry over the years," Bornstein Seafoods CEO Colin Bornstein told IntraFish.
Bornstein Seafoods, Pacific Seafood Group and Da Yang Seafoods all process hake onshore at Oregon facilities, and Phoenix Processor Limited Partnership operates mother ships in the fishery.
"In addition, the global shipping crisis and inflation will have a major impact on the ability of the markets to continue to absorb the normal volumes," Bornstein said.
"I believe that people will have the desire to consume the products, but like Alaskan pollock, the costs for hake will have to rise as well. The processors that can produce fillets will have the greatest advantage to fill gaps created from the Alaska pollock shortage."
Pascal Guenneugues, founder of surimi supplier and analysis group Future Seafood, told IntraFish that events in Eastern Europe are likely to send the global surimi market into a severe supply crisis as trade sanctions and shipping blockages stem the flow of product globally.
"Regarding the global supply, the sanctions (and the cut-off of transit of frozen cargo by the shipping lines to/from Russia) will affect the surimi market," he said.
Eastern Europe imports close to 40,000 metric tons per year of surimi per year, he said.
"This number would have certainly increased again by 10 percent or more without this war since all markets were doing very well in the past few months."