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3-Minute Market Insight

EP 536 | AIRED 05/03/2021

Alaska Worker Shortage Effects on Salmon This Year

May 3rd, 2021--- This week we report on rumblings of labour shortages in Alaska and the affects on the upcoming Salmon season.

--- As processors in Alaska try to hire for the upcoming Salmon season, our sources are reporting extremely low applicants all while the labour pool in Alaska continues to be a point of strain.

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There is speculation that processors will have to increase wages in an attempt to entice applicants potentially increasing the cost of processed fish upwards of 30 percent.

If this becomes reality, expect this to set the stage on pricing for fresh and frozen Salmon this year.

In 2020, we saw some high prices right out of the gate for Alaska Salmon, and we don't anticipate 2021 to start out any different.

At the time, it was easier to digest higher prices for buyers and consumers - because the industry was in uncharted waters with COVID-19 and its effect on cost and general production.

For 2021, buyers are now equipped with a better understanding of the type of demand Salmon can command at the retail level during a pandemic - all while as foodservice has still not fully recovered.

In our report at the beginning of this year on quality seafood leading the way, we advised that...

38,000,000 lbs Pink Shrimp Forecasted

"As COVID-19 protocols continue to be the new normal, Americans eating at home will be seeking foods that offer value, quality, and transparency where "value does not necessarily mean they are seeking the lowest-priced item"

- "They are investing in quality over quantity", “It’s about perceived quality and reliability.", "In a growing recession, consumers can’t afford to make a mistake."

- "mentioning "Alaska seafood" increases consumers' willingness to purchase, and the Alaska Seafood logo is strongly associated with quality and sustainability - consumers are willing to pay a premium for seafood that includes the ASMI logo."

With that said, we anticipate pricing to be at the same level or higher than last year - with the added potential for Alaska Seafood Marketers to push the value of Alaska Caught seafood even higher.

One thing is for sure is that pricing is unlikely to drop, fall, or decline, and we will continue to see a bullish market for Salmon in 2021.

2020 Sustainability Report

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Moving onto supply expectations and although Alaska’s 2021 Salmon Season is projected to yield a harvest 60 percent higher than last year, this surge is to be led by a larger Pink Salmon harvest of 124.2 million fish.

Odd-year Pink Salmon harvest in Alaska are typically larger than even-year seasons.

Expect supply on Chinook, Chum, Coho, and Sockeye to be similar to what we experienced in 2020 - especially as British Columbia, Canada and Washington State Salmon fisheries continue to struggle to produce large harvest.

Looking at twice frozen Salmon supply, in Russia, Pink Salmon will also lead the pack with a harvest forecast of 322.3 thousand metric tonnes (or 267.81 million fish), up from 176 thousand metric tonnes in 2020.

Pink Shrimp Forecast

Russian Chum Salmon harvest is anticipated to hit 93.5 thousand metric tonnes (or 30.48 million fish) for 2021, up from 79 thousand metric tonnes last year.

Our recommendation is to start making your 2021 Chum Salmon commitments as soon as possible, and to keep tuned into these updates as we will provide more on the Salmon market as we get closer Alaska's start date which is set for around mid-May.

For a more complete picture of Global Salmon Harvest for 2021, please see our Salmon updates from a few weeks back in which links are provided below the video. Full video: Here

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