Will fisheries never be profitable_ isheries never be profitable

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V OLUME 11 ISSUE 1                                                            J A N U A R Y/ FE B R U A R Y                     2005

    Will fisheries never be profitable?
  Treadmill effects and capitalization of
      profits in Norwegian fisheries
                                                 by Gakushi Ishimura
 Fisheries management has much improved in Norway
 since the 1990s. In 2002, Norwegian fisheries caught 2.6
 million metric tonnes of fish. The value of total marine
 captures has also increased because the ex-vessel price
 has increased for the main species. Annual production per
 fisherman, which is an economic performance indicator,
 attained 600,000 NOK1 per fisher in 2002, including those
 who had fishing as a secondary occupation. The Norwe-
 gian fisheries are among a few examples of successful
 fisheries in the world.
                 Although short-run profits from such fisheries
 would be expected to increase, the annual average profits
                                              in fishing vessel
                                              accounts does
     In this issue...                         not indicate a
                                                                  Purse seiner, the Thore Ingolf, fishing in Hardanger fjord,
                                              steady increase     southern Norway.                   Photo by the Lie brothers, Bergen
    Treadmill economics                       in profits corre-
    in Norwegian fisheries                    sponding to the     zero between 1998 and 2002. In contrast, annual average
                                              increase in         long-term debt, which reflects new investment in vessels
                                              revenue. For        including gear and quotas under the Transferable Quota
    Flensing adventures                       instance, for       (Individual Vessel Quota) system, has grown from 6 million
                                              fishing vessels     NOK to 12 million NOK within four years, which is more than
    Seahorse surprise in                      over 13 m length,   the annual revenue.
    Portugal                                  which were                  The treadmill theory of profit was first introduced in
                                              responsible for     agricultural economics as a phenomenon resulting from
    Cecil and Kathleen                        85% of landing      capacity expansion, where farmers continuously attempt to
    Morrow Scholarship                        values of Norwe-    improve their incomes by adopting new cost-reducing
                                              gian marine         technologies and acquiring more land to achieve a larger
    winner 2005
                                              capture fisheries   scale of production (Cochrane 1958, Levins and Cochrane
                                              in 2002, annual     1996). The more that adoption of new technology occurs, the
    And, as always, lots of                   average profits     more production goes up, and the price goes down because
    News and Notes!                           per vessel          of the demand-supply mechanism in the market. Conse-
                                              fluctuated around   quently, profits from adaptations that lower production costs
                                                                                                       Continued on page 2 - Treadmill
FishBytes – January/February 2005                                                                                                  Page 2

 Treadmill - Continued from page 1              quotas (equivalent of land in agricul-          framework will be done in 2005.
                                                ture). Consequently, potential in-                      This research was initiated
 are countered by a lower price of the          creases in profits are invested without         during the author’s stay in Norway,
 product, and profits expected by the           visible increase in profits, and quota          funded by the Research Council of
 adoption of new technology do not              prices are driven up in the competitive         Norway. An extension of this article
 materialize (product price treadmill). If      market. This treadmill effect has been          will shortly be submitted to an aca-
 prices stay the same, farmers acquire          discussed for a long time. However,             demic journal as a short communica-
 more land to increase production and           an empirical study has never been               tion.
 seek a larger scale of operation as            done due to the confidential nature of
 they chase prospective profits.                fisheries operating accounts.                   References
 Farmers bid against each other over a                  My analysis of Norwegian                Cochrane, W. W. 1958. Farm Prices:
 limited amount of land, which drives           fishing accounts suggests that in-                 Myth and Reality, University of
 up land prices and again results in            creased profits are being reinvested in            Minnesota Press: St. Paul.
 potential profits being used for               new technologies, which includes                Levins, R. A. and Cochrane, W. W.
 investment (capacity expansion                 fishing capacity expansion and                     1996. Land Economics, 72(4): 550-
 treadmill2).                                   acquiring additional quotas to expand              553.
         Whitmarsh (1998) suggested             the scale of operation. In other words,         Whitmarsh, D. J. 1998. Land Econom-
 the existence of a similar treadmill           increased resource rent is capitalized             ics, 74(3): 422-427.
 effect for profits in fisheries under          as new vessels and additional quota
 quasi-property rights (i.e., IVQ system).      rather than materialized profit for             Footnotes
 Improvement of harvest efficiencies by         fisheries. Further detailed analysis of         1. Approx. US$94,100 (March 2005)
 adopting cost-reducing technologies            Norwegian fishing vessel accounts               2.Whitmarsh (1998) called this the
 leads fishermen to acquire more                and the development of the theoretical          “land market” treadmill.

                                               Stinky minke
                                     by Andrea Coombs and Lindsay Wilson
 Alexandra Morton (Raincoast Re-                Word on the street was that Andrew                   Science Centre travelled to Telegraph
 search Society) witnessed a life and           Trites had been looking for marine                   Cove to flense (i.e., strip skin and
 death struggle in early November as a          mammal skeletons to suspend in the                   blubber) the minke — and boy was it
 pair of killer whales attacked a minke         atrium of the new Aquatic Ecosystems                 stinky!
 whale in Echo Bay in the Broughton             Research Laboratory (AERL) building at                        We were all grateful to the 30+
 Archipelago, British Columbia. The             UBC. With this in mind, the whale was                eagles that had eaten about two-thirds
 killer whales drove the lone animal            towed to Telegraph Cove and placed                   of the 25-foot whale over the past
 into the shallows where it later               on a beach to decompose.                             couple of months. The team went to
 suffocated under its own weight.                       On February 12, 2005 a team of               work dressed in their finest disposable
 Unable to get to the minke whale, the          volunteers from the UBC Marine                       clothes (due to the goo-factor) and
 killer whales left their prey for the          Mammal Research Unit (MMRU) and                      were armed to the hilt with knives.
 bears and eagles to consume.                   the Vancouver Aquarium Marine                        Within three hours we had the whale
                                                                                                            packaged into manageable
                                                                                                            bundles for its trip back to Van-
                                                                                                            couver — in an open truck … the
                                                                                                            other ferry passengers must have
                                                                                                            loved us!
                                                                                                              The bones are now suspended
                                                                                                            in seawater for a 6-month
                                                                                                            washing cycle to remove the
                                                                                                            remaining tissue. In time, the
                                                                                                            whale’s skeleton is expected to
                                                                                                            hang in AERL with skeletons from
                                                                                                            other representative species of
                                                                                                            marine mammals from British
                                                                                                              Stay tuned for more marine
 1. (from left) Andrea Coombs, Lindsay Wilson and Andrew Trites with the whale’s skull; and 2. (from       mammal flensing adven-
 left) Stephen Raverty, Danielle McLaughlin and Janice Bridgland stripping the whale’s spine.
Page 3                                                                           FishBytes – January/February 2005

   A conservation challenge in Portugal
                                                        by James Hrynyshyn
 Europe may be united, but its two                 coast of Portu-
 species of seahorses would rather go              gal.
 their own separate ways.                                  With one
        Project Seahorse Research                  of the world’s
 Associate, Janelle Curtis, recently               densest
 discovered that it won’t be easy                  seahorse
 coming up with conservation plan for              populations and
 the two species, each of which thrives            easy access to
 under opposing conditions.                        their habitats,
        The long-snouted seahorse,                 the lagoon
 also known as Hippocampus                         makes for an
 guttulatus, prefers a dense complex               ideal natural laboratory.                          European conservation strategies may
 habitat common in undisturbed                             After four years of tagging                therefore have to take into account the
 seagrass beds. The short-snouted                  seahorses, doing underwater visual                 habitat needs of both species when
 seahorse H. hippocampus, however,                 surveys and estimating seahorse                    setting up marine protected areas and
 prefers relatively sparse habitats, such          numbers for her PhD research, Curtis               managing the non-selective, bottom-
 as those created by fishers dragging              realized that local seine fishing wasn’t           dragged fishing gears like seines and
 seine nets.                                       making life difficult for all her research         trawls.
        “It’s not a surprise that each             subjects. When seining was experi-                         Curtis recently received a PhD
 species would have its own needs,”                mentally stopped in some areas, H.                 from Montreal’s McGill University for
 says Curtis. “But I wasn’t expecting              guttulatus numbers rose along with the             her seahorse research. The journal
 such a big difference between the                 quality of the vegetative cover. By                Marine Ecology Progress Series is
 two.”                                             contrast, however, H. hippocampus                  expected to publish a paper by Curtis
        H. guttulatus and H. hippocam-             seemed to do better in areas fished                and her supervisor, Project Seahorse
 pus are comparable in size, with each             with seines, which simplified the                  Director Amanda Vincent, on the
 reaching a maximum length of 16-18                habitat.                                           distribution and abundance of the two
 centimetres, and both are found in                        “There could be a happy me-                seahorse species later this year.
 coastal European waters and through-              dium, one where both species do
 out the Mediterranean. Curtis carried             relatively well. But my data suggest that          James Hrynyshyn is the outgoing
 out her research in the Ria Formosa               what works best for one species may                communications coordinator
 lagoon, a national park on the south              not work as well for the other,” she says.         for Project Seahorse.

      Cecil and Kathleen Morrow Scholarship winner 2005
  Congratulations to Fisheries Centre PhD student Brajgeet Bhathal, who has just completed her MSc (Historical reconstruction of Indian
  marine fisheries catches, 1950-2000, as basis for testing the ‘Marine Trophic Index’ , defended Dec.13, 2004) and who has been
  awarded this year’s Cecil and Kathleen Morrow Scholarship, a generous endowment by Cecil B. Morrow, awarded annually to a
  Fisheries Centre student with the best academic travel proposal for research work to use methods developed at the Fisheries Centre.

  Fisheries management in India has been relatively poor in many places. Bhathal (2004) has recently shown, via recon-
  struction of catch data (1950 to 2000) and use of ecosystem indicators i.e., Marine Trophic Index and FiB index (Pauly et al.
  1998; Pauly and Watson 2004), that the marine fisheries in India appear to be unsustainable at the ecosystem level.
  However, to further support this and better understand the fishing impacts, there is need for further research. Thus,
  Brajgeet will continue her research on Indian fisheries, with emphasis on effort and cost data, and build ecosystem
  models to explore different policy options for fishery management in India. In order to compile huge datasets for 13 study
  areas (i.e., 9 maritime states and 4 union territories of India), a field trip will be made in this fall. The Cecil and Kathleen
  Morrow Scholarship will help to meet Brajgeet’s travelling expenses.

  Bhathal, B. 2004. Historical reconstruction of Indian marine fisheries catches, 1950-2000, as basis for testing the ‘Marine Trophic Index’. MSc.
    Thesis, Faculty of Graduate Studies. Vancouver, the University of British Columbia: 141 pp.
  Pauly, D., Christensen, V., Dalsgaard, J., Froese, R. and Torres, J. F. 1998. Fishing down marine food webs. Science 279: 800-863.
  Pauly, D. and Watson, R. in press. Background and interpretation of the ‘Marine Trophic Index’ as a measure of biodiversity. Philosophical
    Transactions of The Royal Society: Biological Sciences.
FishBytes – January/February 2005                                                                                         Page 4

                                              News and Notes
           Congratulations ...                                             Pi Jen Liu arrived at the Fisheries Centre in Novem-
                                                                   ber 2004. He is undertaking a PhD in the Department of
 Some lucky people have job offers before they graduate            Life Sciences of National Chung Hsieng University, Taiwan
 and some get them afterwards - but how many people get            ROC ( He will stay in Vancouver for one
 a job on the very day they hand in their thesis to the library?   year and is studying the coral reef ecosystems of Taiwan.
 After successfully defending her Masters thesis, “Haunted         One part of his thesis will use Ecopath with Ecosim models
 Waters: A quantitative estimate of ghost fishing of crabs         to explore different policy scenarios in coral reef fisheries.
 and lobsters by traps”, exactly that happened to Fisheries                Suzanne Mondoux has joined the Sea Around Us
 Centre graduate Amy Poon when she was offered a job               project as a research assistant to Daniel Pauly. Suzanne is
 with the Vancouver Aquarium’s youth initiative project. The       French-Canadian and has worked and travelled in different
 aquarium ( is launching a                   parts of Canada, Europe and Africa, doing many kinds of
 website to bring information about their research and             things within the natural resources sector.
 conservation programs to youth (ages 14-21) and to engage                 Georg Skaret is from Norway, where he is doing his
 their interest in conservation and stewardship. Amy will be       PhD on behaviour of Norwegian herring during spawning.
 writing for the website, in conjunction with a youth educator     More particularly the work focuses on how dynamics in
 and a website designer.                                           schooling influence abundance estimates from acoustic
                                                                   surveys. The work will also include an individual based
                 ...Welcome ...                                    schooling model to investigate schooling patterns emerg-
                                                                   ing with varying number of individuals and different
         Geoff Gilliard is the new communications co-              spawning motivation. He is working with Tony Pitcher’s
 ordinator for Project Seahorse. Geoff has a degree in             group, and will stay at the Fisheries Centre until the end of
 Communications from Simon Fraser University, B.C., and            July, 2005.
 has worked as a freelance communications consultant for
 the past five years, specializing in issues related to sustain-                 ... and Farewell
 able development. One of the many aspects that he enjoys          James Hrynyshyn is trading his duties as communications
 in his new capacity is cycling to work along Marine Drive.        coordinator with Project Seahorse for those of master
 He is married with two young daughters and enjoys                 renovator of his wife’s family’s century-old family home in
 drumming, camping and playing ice hockey.                         Saluda, North Carolina. His degrees in journalism and
         Jens Kjærsgaard is a visiting scholar from the Food       marine biology are unlikely to provide much in the way of
 and Resource Economic Institute (at KVL) in Copenhagen.           the necessary skills, however, and his next assignment is
 His PhD research is on fisheries economics and his project        expected to take considerably more than the two years he
 aims to elicit optimal management policies of fisheries           spent at the Fisheries Centre. He encourages everyone to
 resources, when several conflicting objectives are taken          keep him in the seahorse/marine mammal/fisheries loop,
 into consideration simultaneously. The objectives may be          through his email ( Hrynyshyn said
 economic, environmental or political. The topic is ap-            he is finding it hard to let go. “Believe me, if I could open a
 proached by operational research and the economic                 Fisheries Centre satellite office in North Carolina, I would,”
 objective will serve as a point of reference. Jens is here        he said, shortly before leaving Vancouver “but my new
 until May, 2005.                                                  home will be 379.7 km from the ocean.”

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