Four of the five salmon species harvested in Alaska have showed upward ticks in dockside and wholesale prices in recent years. The one exception is sockeye salmon (reds), which account for up to two-thirds of the total value of the statewide catch.
The average price for sockeye last year was 67-cents a pound, down from 73-cents in 2005. Two important trends are driving the sockeye slump, according to industry analyst Chris McDowell of the Juneau-based McDowell Research & Consulting Group.
Most importantly, there has been a dramatic drop in sockeye salmon exports to Alaska's most important seafood customer, Japan.
"Japan has traditionally taken about 75 to 80 percent of Alaska's H&G (headed and gutted) frozen sockeye pack. For 2006 Japan received 37 percent," McDowell said. That has made available about 30 million pounds of frozen reds to other markets, primarily the U.S. and Europe.
Hefty catches have also kept a downward press on the conventional sockeye market. In the past 110 years, the Alaska harvest has topped 40 million fish just 13 times - three of those occurred in the past three years. The catch projection for reds calls for a similar haul this year.
"This will be the year when we see to what extent the alternative markets are ready to absorb the additional volume of sockeye at a price that benefits the Alaska industry, "McDowell said.
There are likely to be additional volumes of pink salmon for growing markets to absorb as well. Last year Alaska had one of the smallest humpy harvests ever, but forecasters are calling for a bumper catch in 2007. Pink salmon abundance traditionally ebbs and flows on a two year cycle, and 2005 yielded the largest harvest ever topping 160 fish.
"Those are the parents of this year's fish. We're projecting 108 million pinks but I think we could see a catch exceeding 130 million pinks," McDowell said.
Fewer pinks are ending up in cans, going instead into more valuable frozen products.
Three to five years ago, 75 to 80 percent of Alaska's pink salmon ended up in cans. But a major shift in demand for frozen pinks, especially in China and Europe, has reduced the canned pack to about 50-55 percent, McDowell said.
"The oversupply situation for canned pink salmon has ended, and we've seen a major price increase as a result. Two years ago the average price for a case of canned pinks (48 talls) was $34. At the end of last year, the case price was up to almost $54. This will be the first time in several years that we haven't entered the new production season with canned pinks still in inventory," McDowell said.
Interestingly, in some years up to half of the total world supply of wild salmon is pink salmon. For Alaska, pinks usually comprise fully half of the state's annual harvest.
McDowell said coho salmon (silvers) have been the biggest value gainers in recent years. In the last sales quarter of 2006, average wholesale prices for frozen cohos jumped from $1.90/lb to over $2.70/lb, an increase of 43 percent from the previous year.
The market for Alaska chum salmon is also changing. "Sometimes as much as two-thirds of the wholesale value of chums has accrued from the roe. It's still a major driver, but there is significant interest in frozen chums and fillets," McDowell said.
In 2003 the wholesale price for H&G frozen chums was in the 40 cent range; more recently it has approached $1.00/lb.
For chinook salmon (kings), increased catches from West coast fisheries to between 400,000 to 500,000 fish could crimp the record prices Alaska has enjoyed.
"That's double last year, but it's still only half of the previous five year average. So it's going to take the edge off some of the unmet demand, but I still think the king markets will be relatively strong this year," McDowell said.
For nearly all salmon species, fillets are the product of choice by most consumers, and that has not been lost on Alaska's processors. Last year in-state fillet production exceeded 28 million pounds, more than double from three years ago. Of that, more than 15 million pounds were sockeye and coho fillets.
Finally, the last two seasons marked the first time in a decade that the dockside value of Alaska's salmon fishery topped $300 million, and industry watchers predict that trend will continue in 2007.
Welch, who lives in Kodiak, has written about Alaska's seafood industry since 1988.