E&E's Salmon Ikura Outlook
2021-06-18
E&E's Salmon Ikura Outlook

The chum and pink salmon runs for Cook Inlet (and Kotzebue Sound for chums) don’t start in earnest until mid-July. Ikura (often called "salmon caviar") processing at our Pacific Star plant follows closely behind and in a normal year, most of our production happens in August, with shipments to Seattle occurring as we fill containers. We anticipate this year to be similar to last year in terms of timing.

Although PacStar’s total ikura production volume the past two years has essentially been the same, we believe this year’s output might be higher for a couple of reasons:

• First, although actual catch figures have declined the last few years for both pink and chum salmon, the state surveys and biologists’ assessments forecast runs to be higher this year.

Pink salmon runs on a two-year cycle, with odd-years in Alaska being the “on-year” when harvests are normally robust.

This year’s all-Alaska forecast for pinks is 124mn fish, twice as much as 2020’s forecast of 60mn (versus actual of 58mn fish) and similar to 2019’s 139mn forecast (129mn actual). However, most pinks will be in Southeast and Prince William Sound, two areas we don’t generally source from, though their existence will likely affect the market.

The 2021 pink salmon forecast for Cook Inlet is 2.8mn fish, close to 2020’s actual catch on a forecast of 3.4mn fish.

For reference, 2019’s Cook Inlet forecast was 3.5mn fish, as opposed to the actual catch of 2.1mn pinks.

Obviously, we don’t get all the fish in any area, though we are a major player in Cook Inlet.

Chum salmon runs follow a less predictable pattern and harvests the past two years have been both considerably under forecasts and poor. This year could be more of the same, though given how poor last year’s harvest was, there is nowhere to go but up…right?

2019 all-Alaska forecasted catch was 29mn (260,000 in Cook Inlet, 2.2mn in Kotzebue’s AYK area) and the actual catch was 20mn fish (184,000, 1mn).

2020’s all-Alaska forecast was about 20mn fish (256,000 fish in Cook Inlet, 2mn in AYK); actual catch was 8mn fish (39,000 fish – not a typo – and 190,000 fish, though some of the AYK fish were caught in the Yukon and Kuskokwim River systems).

2021 sees a further decline in the forecast to 15mn fish (161,000 fish in Cook Inlet and 570,000 in AYK).

• Second, we have more fishermen fishing for us – likely leading to more fish even if the catch numbers decline. In addition, as part of the growing Canfisco organization, E&E may also have access to additional raw material from other Canfisco affiliates. These are both positive developments that are unrelated to the run.

• Industry-wide, we’ve also heard talk that some of the major packers are cutting back on finished product because of labor shortages and freezing eggs as green roe instead.

• Ultimately, production is largely determined by the actual catch and until we see that, forecasts are just forecasts.

While production the past two years has been similar, the sales pattern has been very different. It took us almost twelve-months to sell all our inventory in 2019, but last year we were sold out by December. Since then, we have also had many inquiries from existing and new customers asking if we had anything left to sell, so there still seems to be robust demand. This is the big wild-card this year – demand.

Some of the growth in demand was due to a growing customer base, some due to changes in consumption patterns brought on by COVID, and some due to better overall production quality. We added some new machinery to increase output and some adjustments we plan on making to the process should lead to drier ikura. Our pack size remains a 500g tray, with 24 trays per master case; the salt target remains at 2.5%. Yet, a lot of the production quality depends on how concentrated the run is and on how fresh the fish are. We have little control over how many fish show up at each opener and do our best to deal with every surge of fish as carefully and efficiently as possible. As far as freshness goes, we work with our fishermen and our production crew to maintain the highest quality possible.

The final element related to demand is price. Though PacStar ikura is less well-known than Trident, Ocean Beauty and Peter Pan’s, the premium those name brands have been able charge is shrinking each year – and not because their prices are going down! Coupled with the fact the market is very short at both the packer and distributor level, if demand stays strong, we expect prices will be firmer this year and anticipate our pink ikura priced at $18-$20 per lb. and chum ikura priced at $25-$28. Of course, these are just preliminary indicative prices and are subject to catch, production, timing of the run, quality and size of the eggs, and a host of other variables.

In short, we expect pinks and chums to show up on time, in hopefully greater volumes, from which we will endeavor to produce dry ikura at modest salt levels, have much of it sold as soon as possible, and at prices that make sense for both of us.

Let us know your needs for the year.


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