Has the financial viability of the fishery changed?

Indicators: Landings | Revenue

Key Findings

  • Non-whiting groundfish landings showed a declining trend from the 1980s up to the start of the baseline period and stabilized thereafter.
  • Over the first five years of the Shorebased IFQ Program, the annual landings of non-whiting groundfish continued to be relatively stable despite the continuing downward trend in fleet size (Number of Active Vessels).
  • Numerous interrelated factors contribute to the ongoing underutilization of the allocation for many non-whiting groundfish species. Government and industry have taken steps to improve annual catch limit (ACL) attainment rates since the catch share program began.
  • Harvests by the shorebased Pacific whiting sector have grown in the last two decades, especially through the 1990s.
  • Average annual landings of shorebased Pacific whiting during 2011-2015 were about 21 percent higher than the 2002–2010 average due to strong year classes that resulted in high ACLs.
  • The proportion of the shorebased Pacific whiting allocation harvested was high during the first years of the Shorebased IFQ Program, but it fell substantially in 2014 and 2015 due to a combination of especially high allocations (Ratio of Catch to Quota and Annual Catch Limits), weak markets (Financial Viability of the Fishery: Revenues), and low catch rates that may have been caused by anomalous oceanographic conditions.

Interactive Chart Story

Metrics

This indicator measures changes in groundfish landings that affect the financial viability of fishing operations participating in the catch share fishery.

Analysis

Baseline: Before Catch Share Program

Landings of non-whiting groundfish in the trawl fishery decreased steadily from the 1980s until around 2001, when they stabilized at approximately 20,000 mt. Total non-whiting groundfish landings during the 2002–2010 period were about 27 percent of the landings during 1981–1989. In contrast, shorebased Pacific whiting landings during the 2002–2010 period were more than sixty times what domestic landings were in 1981–1985 and accounted for the vast majority of trawl vessel groundfish landings by weight. Nevertheless, non-whiting groundfish accounted for the majority of trawl vessel gross revenues throughout the baseline period (2002–2010) due to their higher per-unit value (Financial Viability of the Fishery: Revenues).

The reductions in non-whiting groundfish landings were partially the result of increasingly restrictive management measures implemented by the Pacific Fishery Management Council. These measures, which were aimed at rebuilding overfished stocks, included reduced trip limits, area closures, and gear restrictions (Management Framework), and they resulted in lower harvests for both overfished and co-occurring species. Additionally, some groundfish stocks, whether overfished or not, may have experienced declines in biomass in the 1980s and 1990s due to a period of reduced productivity of the California Current (History of the Fishery).

The species composition and total volume of the non-whiting groundfish harvest changed over time. Rockfish landings during the 2002–2010 period were only about 7 percent of the landings during 1981–1985. Historically, rockfish were an important component of trawl fishery landings. But rockfish harvests declined due to decreasing abundance of several rockfish species (e.g., darkblotched rockfish, canary rockfish, and bocaccio) and regulations enacted to protect the depleted stocks (Management Framework). Moreover, opportunities to harvest healthier rockfish stocks (e.g., yellowtail and chilipepper rockfish) were substantially limited because of their relatively high degree of co-occurrence with overfished species. Harvests of flatfish, such as arrowtooth flounder and petrale sole, as well as some types of non-whiting roundfish, most notably sablefish, increased in economic importance as fishermen diverted their fishing effort from rockfish to other groundfish species. However, landings of some roundfish decreased substantially. In particular, a decline in lingcod catches occurred as a result of overfishing, as well as restrictive management measures intended to foster a rebuilding of depressed rockfish stocks that are caught in conjunction with lingcod.

While total non-whiting groundfish landings by the trawl fleet declined, harvests by the shorebased Pacific whiting sector grew, especially through the 1990s. A marked increase in 1994 resulted from a new stock assessment based on an expanded and improved survey. In 2002 and 2003, harvests of Pacific whiting were restricted based on highly variable stock assessment results. Catches rebounded following removal of the stock from its overfished status, but they declined in the late 2000s when stock assessments showed a decreasing abundance and allocations were reduced. In addition, NMFS temporarily closed the Pacific whiting fishery in 2008 in order to keep the bycatch of overfished species within limits.

During Catch Share Program

Non-Whiting Fishery

Over the first five years of the Shorebased IFQ Program, landings of non-whiting groundfish were relatively stable despite a substantial reduction in fleet size (Number of Active Vessels). Average annual landings were about 18,000 mt, which is around 90 percent of the average during the baseline (2002-2010). This stability suggest that vessels which were idled following catch share program implementation tended to be less productive, and consolidation of fishing activity primarily occurred among the most productive vessels.

Since the implementation of the catch share program some target non-whiting groundfish, such as petrale sole and sablefish north of 36° N. latitude, have had high ACL attainment rates. On average, however, the non-whiting groundfish fishery has been unable to land more than about one-third of its annual allowable harvest (Ratio of Catch to Quota). In 2015, the attainment level was only 21 percent.

Decreases in attainment have been partially driven by recent increases in the ACLs for some target non-whiting groundfish species (Annual Catch Limits). Current allocations for a number of species are higher than the historical catch within the non-whiting groundfish trawl fishery. For example, the highest landings of Dover sole occurred in 1996 (12,000 mt), and a second peak nearly as high occurred in 2009. These peaks, however, were still only about 26 percent of the 2015 Dover sole ACL (46,986 mt).

A second reason for the low overall attainment rate are the complex, often interrelated, factors that have created barriers and disincentives to achieving higher levels of fishermen participation in the non-whiting groundfish fishery. Some of these factors are discussed below, together with government and industry initiatives to improve ACL attainment rates.

Weak Markets

Low attainment has been perpetuated by market factors (demand and price) caused by inconsistent supply. Changes in the temporal distribution of fishing effort related to implementation of the Shorebased IFQ Program have exacerbated problems related to the stability and reliability of non-whiting groundfish landings. With the move from bimonthly cumulative trip limits to individual fishing quotas, vessels have more flexibility in choosing when to participate in the groundfish fishery, and the harvester/processor coordination required to maintain a consistent supply has not occurred. The number of fishing trips and number of days an individual processor receives deliveries have generally decreased, while the average delivery size has increased (Average/Total Days at Sea and Delivery Size ). The average non-whiting groundfish vessel decreased its days at sea in the groundfish fishery from 67 to 51 days, or 24 percent, after the catch share program was implemented. Without a predictable supply, buyers and processors have a difficult time securing premium retail markets for non-whiting groundfish (Financial Viability of the Fishery: Revenues), which can create a self-reinforcing cycle: lower prices make fishing for non-whiting groundfish less profitable in comparison to other fisheries (Fishery Diversification) and result in fewer participants in the fishery, fewer trips per vessel, lower overall landings, and ultimately, low ACL attainment rates.

Constraining Species

Fishing to avoid constraining species has likely decreased ACL attainment for some target species. Non-whiting groundfish stocks that are overfished and managed under rebuilding plans have low ACLs. The most severe example is yelloweye rockfish, which had a total allocation of only 1,323 quota pounds (QP) in 2011 and a median QP allocation of only 4 pounds. Moreover, allocations were unevenly distributed across quota holders (Access and Exclusion Effects). During the first five years of the program catches of overfished species were far below the total QP allocated for those species (Ratio of Catch to Quota). However, these catches tend to be uneven, and some fishermen caught more than the QP they were originally allocated and had to obtain additional QP, which can be expensive or difficult to find (Access and Exclusion Effects and Cost of Fishery Management: Private).

A number of fishermen may have chosen to forego a portion of their potential yield of target species in order to avoid harvesting co-occurring overfished species for which they had little or no quota. In particular, the threat of a “lightning strike” catch event in which a single tow puts a vessel over the annual vessel limit for that species encourages fishermen to be risk-averse in their fishing location choices. Even though a vessel might be able to find enough available QP on the market to cover its deficit, it still might not be able to fish for multiple years because catch share program regulations limit the amount of QP that can be transferred to a vessel account (Shorebased IFQ Program). One such lightning strike occurred in 2015, when a vessel using midwater trawl gear to harvest non-whiting groundfish inadvertently caught 47,000 pounds of canary rockfish.

As overfished species rebuild and become more abundant, the risk of an unexpected catch increases, further encouraging conservative fishing behavior that is likely to decrease the ACL attainment rate for target species. The infrequency of stock assessments and the slow speed at which new assessments enter the management system constrains the alignment of ACLs to biomass conditions. For example the 2014 stock assessment for canary rockfish shows that the stock is rebuilt; however, due to the two-year harvest specification cycle, the ACL for the species didn’t increase until 2017 (the 2017 ACL increased more than five times what it was in 2016) (Annual Catch Limits).

Other stocks are not overfished but may still constrain some harvesters in the non-whiting groundfish fishery given the high demand for quota. For example, some non-whiting groundfish fishermen feel that, as a result of the acquisition of leased limited entry trawl permits by fishermen who primarily participated in the limited entry fixed gear sablefish fishery prior to implementation of the catch share program (Financial Viability of the Fishery: Revenues), accessing sablefish QP became more difficult, which, in turn, hampered their ability to catch their quota of deep-water target species that co-occur with sablefish, such as Dover sole and thornyheads. However, an analysis in the NMFS Five-year Review of the catch share program shows that, while acquisition of sablefish QP by the fixed gear fishery depressed catches of co-occurring species, full utilization of those species was not likely during the first years of the catch share program, especially after the ACLs for both Dover sole and thornyheads increased substantially in 2015.

Fishing Costs

When the Shorebased IFQ Program was developed it was expected that the program would increase harvest and efficiency sufficiently and early enough that fishermen would be able to handle the increased costs of the program. Current data show that average annual vessel revenue and variable cost net revenue have increased since implementation of the program (Financial Viability of the Fishery: Revenues). However, the costs of observer and catch monitor coverage, cost recovery fees, and quota acquisition (Cost of Fishery Management: Private), together with the complexity of operating in the non-whiting groundfish fishery, have deterred participation in the fishery and have provided a disincentive to the consistent effort that would translate to a steady market supply and higher ACL attainment rates. Also, non-whiting groundfish vessels are still under many of the same gear restrictions and time/area closures that existed prior to 2011. These regulations limit access to healthy stocks and contribute to higher operating costs.

Government and Industry Initiatives to Improve ACL Attainment Rates

To help alleviate the constraining species problem, the Council and NMFS implemented a new management tool in 2017, whereby specific amounts of yield that are deducted from the ACLs for canary rockfish, darkblotched rockfish, and Pacific Ocean perch, to account for in-season unforeseen catch events. The Council determines the distribution of all or part of this “emergency buffer.”

Over time, the constraining species problem is expected to be further alleviated if the current trend of increasing ACLs of former overfished species continues. For example, the 2017 ACLs for many rockfish species such as canary and widow rockfish, formerly listed as overfished, increased more than five times what they were in 2016. As noted above, however, improvements in the speed of ACL adjustments are also needed. The Council and NMFS has been using the exempted fishing permit (EFP) program as a temporary fix to get past the slow-moving regulatory process. Since the catch share began, EFPs have been issued to many non-whiting groundfish vessels to test various types of alternative fishing gear, with the objective of increasing ACL attainment rates. In 2017, for example, more than 30 vessels applied for an EFP that would exempt them from the requirement to use selective flatfish trawl gear shoreward of the Rockfish Conservation Area (RCA) north of 40 degrees 10′ N. latitude in order to re-establish targeted fisheries for widow, yellowtail, and chilipepper rockfish as the ACLs for those species increase.

In addition, in 2014, NMFS revised the boundaries of the RCAs to facilitate the harvest of several underutilized target groundfish species, while still protecting overfished species. The individual accountability of the catch shares program supported these modifications to the RCAs by reducing the harvest of overfished species (Ratio of Catch to Quota). Moreover, the advent of precise, near real-time data in the NMFS online vessel account system enables a quick protective response should a species show signs of depletion (Shorebased IFQ Program).

One way in which industry has helped alleviate the constraining species problem is by organizing quota risk pools whereby groups of fishermen collectively manage the risk associated with the catch of overfished species. This strategy provides fishermen with a level of security that allows them to pursue high-risk target species. One such risk pool is the California Groundfish Collective, which is made up of fishing associations from Fort Bragg, Half Moon Bay, and Morro Bay. Collective members fish in accordance to an agreed upon spatial fishing plan that includes voluntary closures in high risk areas and precautionary fishing (e.g., shorter tows) in moderate risk areas, and they agree to share information on overfished species encounters through an electronic logbooks system. From 2011 to 2014, the Collective’s ratio of overfished species catch to target species catch was substantially less than the rest of the non-whiting IFQ fleet (Ratio of Overfished Species to Target Species ). It was higher in 2015 due mainly to increased harvest of bocaccio rockfish (bocaccio was declared rebuilt in 2017).

Despite the potential benefits, however, relatively few fishermen have opted to organize formal risk pools. The California Groundfish Collective has had 10 to 12 member vessels, and in 2015, collectively managed only about 12 percent of the total overfished IFQ species QP. Among the possible factors that discourages risk pool formation is the high cost of negotiating and maintaining legally binding contractual agreements among members.

Industry has also used gear diversification to increase ACL attainment rates. Under the catch share program’s gear switching provision (Shorebased IFQ Program), non-whiting groundfish fishermen were able to alleviate the constraining species problem by using use pot and hook-and-line gear to target sablefish, together with nearshore rockfish and thornyheads (Landings with Fixed Gear ). These fixed gears are not only more selective than trawl gear, they also catch larger sablefish that bring a higher ex-vessel price per pound (Financial Viability of the Fishery: Revenues). Most vessels that have taken advantage of this ability to use any legal groundfish gear in the IFQ fishery primarily participated in the limited entry fixed gear sablefish fishery prior to 2011, but then leased trawl permits after the catch share program began in order to acquire quota for IFQ sablefish (Financial Viability of the Fishery: Revenues). A measure developed by the Council and NMFS in 2016 that allows participants in the Shorebased IFQ Program to register a trawl permit and fixed gear permit to their vessel at the same time is expected to facilitate the expansion into the IFQ fishery of vessels that use only fixed gear.

The conversion to fixed gear contributed to an attainment rate for northern sablefish that stayed above 85 percent from 2011 to 2015 (Ratio of Catch to Quota). However, a confluence of factors has depressed the attainment rate for sablefish south of 36° N. lat., which was highest in the first year of the catch share program (84 percent) but has averaged 26 percent since then. Sablefish price dropped sharply after 2011, although the species remains the West Coast’s most valuable groundfish per pound (Financial Viability of the Fishery: Revenues). Another factor was that the easily accessible inshore fishing grounds for southern sablefish were heavily exploited, leaving only grounds far offshore that were challenging and costly to fish. Finally, the southern sablefish ACL increased from 1.13 million pounds in 2012 to 1.59 million pounds in 2015 (Annual Catch Limits), but the number of vessels fishing for IFQ southern sablefish decreased from 12 in 2011 to 8 in 2014 and 2015.

A second major instance of gear diversification since implementation of the Shorebased IFQ Program was the adoption by some non-whiting groundfish vessels of midwater trawl gear to increase their harvest of rockfish that display off-bottom schooling behavior, such as widow and yellowtail (Landings with Midwater Trawl Gear ). In addition to allowing fishermen to switch from bottom trawling to midwater trawling, the catch share program eliminated the trip limits that restricted widow and yellowtail retention to those vessels harvesting Pacific whiting during the primary whiting season. In order to target any species with midwater gear, a vessel currently only needs to acquire sufficient QP to cover its catch, although fishing may only occur during the dates of the primary whiting season. Authorized midwater gear types have demonstrated that built-in mechanisms for keeping fishing gear off the bottom minimize the catch of overfished yelloweye rockfish while allowing harvest levels adequate to support a fishery. The number of non-whiting groundfish vessels using midwater trawl gear increased from four in 2011 to 14 in 2015.

Public-private partnerships such as the Groundfish Markets Development Initiative are attempting to increase ACL attainment rates by aligning fishing effort and product availability with market demand through coordination between fishermen and buyers, securing buyers serving various sizes and locations of fishing operations, and overseeing groundfish marketing and promotional campaigns (Financial Viability of the Fishery: Revenues).

Shorebased Pacific Whiting Fishery

Average annual landings of shorebased Pacific whiting during 2011-2015 were about 21 percent higher than the 2002-2010 average due to strong year classes that resulted in high ACLs. The high landings despite a downward trend in fleet size (Number of Active Vessels) suggest that the less productive vessels exited the fishery.

The proportion of the shorebased Pacific whiting allocation harvested was high during the first years of the Shorebased IFQ Program, although it fell slightly in 2012 due to the re-apportionment of surplus Pacific whiting from the tribal sector to commercial sectors made late in the year, which increased the allocation by about 5 percent. The attainment rate was again high (99 percent) in 2013. However, it dropped to 83 percent in 2014 and to 47 percent in 2015 due to a combination of especially high allocations (Ratio of Catch to Quota and Annual Catch Limits), weak markets (Financial Viability of the Fishery: Revenues), and low catch rates that may have been caused by anomalous oceanographic conditions. A comparison of shorebased Pacific whiting landings in pre-catch share years (2005 to 2010) to those in catch share years (2011 to 2015) shows that effort in the fishery has shifted to later in the year. The increased flexibility in fishing operations provided by the Shorebased IFQ program allows fishermen the opportunity to delay the start of their season to target larger, higher-priced fish.

In 2012, the Shorebased Whiting Cooperative was formed to manage bycatch of overfished rockfish species during the harvest of shorebased Pacific whiting. As with the non-whiting groundfish vessel risk pools, members agree to abide to cautionary and closed area rules and requirements for data sharing. Seventeen shorebased whiting vessels currently participate in the Cooperative.

Information Sources

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Chambers, S. 2016. West Coast catch share program failure keeps vessel off fishing grounds for 2016 season. Seafood.com News, March 21.

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Fisheries Leadership & Sustainability Forum and Workshop Steering Committee. 2016. Pacific Groundfish Quota Program Workshop. February 16–18, 2016. Portland, Oregon. Summary of Workshop Themes.

Kauer, K., Rubinstein, A. and D. Oberhoff. 2016. California Groundfish Collective Annual Report 2015. Prepared for the Pacific Fisheries Management Council.

Kuriyama, P. Branch, T., Bellman, M, and K. Rutherford. 2016. Catch shares have not led to catch-quota balancing in two North American multispecies trawl fisheries. Marine Policy 71(September):60-70.

National Marine Fisheries Service. 2009. Our Living Oceans: Report on the Status of U.S. Living Marine Resources. Silver Spring, MD.

National Marine Fisheries Service. 2017a. West Coast Groundfish Trawl Catch Share Program Five-year Review – Draft. Pacific Fishery Management Council. Portland, OR.

National Marine Fisheries Service. 2017b. FISHeries Economics Explorer (FISHEyE). Available online: https://dataexplorer.northwestscience.fisheries.noaa.gov/fisheye/.

Northern Economics, Inc. 2011. Collective arrangements for managing constraining species risk in the West Coast groundfish trawl fishery. Prepared for Environmental Defense Fund.

Pacific Fishery Management Council and National Marine Fisheries Service. 2010. Rationalization of the Pacific Coast Groundfish Limited Entry Trawl Fishery; Final Environmental Impact Statement Including Regulatory Impact Review and Initial Regulatory Flexibility Analysis. Portland, OR.

Pacific Fisheries Information Network (PacFIN). 2013. PFMC Groundfish Management Team Reports, PacificStates Marine Fisheries Commission. Available online: http://pacfin.psmfc.org/pacfin_pub/pfmc.php.

Somers, K, Y. Lee, J. Jannot, C. Whitmire, V. Tuttle, and J. McVeigh. 2017. Fishing Effort in the 2002-20 U.S. Pacific Coast Groundfish Fisheries. National Marine Fisheries Service Northwest Fisheries Science Center. Seattle, WA.

Changing Tastes and Wilderness Markets. 2015. West Coast Groundfish Regional Market Demand and Opportunities. Washington, D.C.

Updated: May 2018

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