Summary of Market Conditions

Filed by Andy Wink on June 19, 2019

Demand for Bristol Bay sockeye has been robust in recent years, as evidenced by the fact that prices have trended upward and despite four straight years of large harvests there has not been a significant amount of carryover inventory. This can be attributed to improved quality, poor harvests in other Alaska regions in 2018, growing demand for salmon globally, successful marketing efforts, and a relatively tighter farmed salmon market since 2015. While sales data for the 2018 sales season (June 2018 - May 2019) is not yet complete, there is enough information to suggest first wholesale sales performance was strong coming off last season. More aggressive bonus payments from processors support this conclusion.

The average base price for Bristol Bay sockeye was $1.26/lb. in 2018. Including bonuses, retros, and profit sharing, many fishermen received final prices of $1.70/lb. or more. These prices are entering uncharted territory for the fishery in “modern times” (post-2000); however, the quality of Bristol Bay sockeye has never been better. Prices are a reflection of both value and abundance.

The outlook for ex-vessel prices in 2019 is favorable, but less certain than last year. Typically a smaller forecast/harvest would result in higher prices, but several other factors are providing headwinds. The following factors will be critical in determining prices for the upcoming season:

  • Bristol Bay harvest and global sockeye supply are expected to decline (prices tend to increase when supply goes down for simple economic reasons but also because processors have more capacity to utilize).

  • Supply growth of farmed Atlantic salmon is expected to be modest, however farmed coho production is expected to increase more rapidly.

  • Capital investments have increased the amount of processing capacity in the Bay, creating a greater demand for raw material.

  • Consumer demand appears to be strong, particularly in the domestic retail and smoked markets. However, high prices often result in lower sales volumes.

  • Farmed salmon prices, while still relatively high, are at their lowest level for this point in the year since 2015. Sockeye usually sells at a premium over farmed salmon, but if the price difference gets too large buyers can be tempted to focus more on farmed salmon. Lower farmed salmon prices are a negative for Bristol Bay fishermen.

  • The U.S. dollar has strengthened considerably since last year (especially versus the euro), which will make Alaska seafood relatively more expensive to foreign buyers. A stronger U.S. dollar is a negative factor for Bristol Bay fishermen.

  • It does not appear that there will be significant, widespread carryover inventory heading into the 2019 season. However, it is possible that product is sitting in inventory further down the supply chain. The risk of inventory increases when sockeye prices and the price difference between sockeye and farmed salmon increases. Large volumes of carryover inventory typically have a strong, negative impact on ex-vessel prices.

Bottom line: higher prices create higher expectations, so quality must be an even greater focus if the harvest is indeed smaller than previous years. Competition, market demand, and excess processing capacity should ensure an aggressive ex-vessel price.

Market & Fishery Value Information

Click on PDF or XLS (Excel) links below to open tables of data. Items are updated as data becomes available.

Key Fishery Value Indicators: PDF - XLS

Ex-Vessel and First Wholesale Prices & Value: PDF - XLS

Selected Market Prices: PDF - XLS

Global Sockeye Supply: PDF - XLS

CFEC Permit Value Data: PDF - XLS

U.S. Sockeye Export Data: PDF - XLS