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Wednesday, May 22, 2019

Costs and Infrastructure

Session Chair: Peder Andersen, University of Copenhagen;

13:30 – 13:48  |  3546092

Economics of the U.S. Western Atlantic bluefin tuna directed fishery

Clifford Hutt1;
1NOAA Fisheries, Silver Spring, United States;

The commercial rod-and-reel, or General category, fishery for western Atlantic bluefin tuna is considered a traditional fishery along the U.S. North Atlantic coast, and is managed by the National Marine Fisheries Service (NMFS) Atlantic Highly Migratory Species (HMS) Management Division. The General category accounts for approximately 45 percent of the annual domestic allocation of U.S. bluefin tuna quota recommended by the International Commission for the Conservation of Atlantic Tunas (ICCAT). Each year about 6,000 vessels acquire a permit authorizing participation in this fishery, but only about 15 percent sell bluefin tuna in a given year. Even with this low success rate, the fishery has been subject to numerous inseason closures and retention limit adjustments over the 2016 to 2018 seasons to avoid exceeding the quota. Despite this, participation in the General category fishery is highly attractive due to the high price of bluefin tuna. In 2018, NMFS implemented a one-year cost-earnings logbook study to collect data on costs associated with active participation in the fishery. Selected vessels were required to report their costs associated with commercial trips targeting HMS within 30 days of trip completion, and their annual expenses associated with participation in the fishery at the end of 2018. Trip level cost data collected included expenses on gas, bait, ice, groceries, tackle and fishing supplies, and crew payouts. Annual expenditure data included vessel and equipment repair and maintenance, capital expenses, dockage fees, loan payments, licenses, and insurance. This study will allow NMFS to assess the profitability of General category bluefin tuna trips overall and by month, which could inform inseason management and future allocation decisions.

13:48 – 14:06  |  3577380

Comparison of capacity utilization in fisheries using physical versus economic data – The double bootstrap DEA method applied to a Vietnamese purse seine fishery

Nga Cao Thi Hong1; Arne Eide2; Claire Armstrong2; Long Le Kim1;
1Nha Trang University, Nha Trang, Vietnam; 2UiT – The Arctic University of Norway, Tromsø, Norway;

Most Data Envelopment Analysis (DEA) studies on fisheries have applied output oriented capacity utilization based on physical measures. In a case study of a Vietnamese purse seine fishery, we analyse and compare input oriented capacity utilization when using physical versus economic measures. Although physical measures represent important input factors (outputs produced) in fisheries, economic measures are expected to captain a full range of fishing inputs employed (multi-outputs produced) in this industry. DEA is considered as a suitable technique to measure the relative capacity utilization in terms of single output and multi-outputs, and multi-inputs in fisheries. The findings show that the economically based capacity utilizations of the average vessel differ significantly from the results of the physically based capacity utilization analysis. The statistical findings also indicate that economic measures used to explain the difference in capacity utilization are superior to the physical measures. Specifically, hull length, skippers skills and family size are the significant factors enhancing the capacity utilization based on the economic approach, whereas only hull length impacts significantly the capacity utilization based on the physical approach.

14:06 – 14:24  |  3586133

A longitudinal analysis of commercial fishing infrastructure

Tracy Yandle1; Gina Shamshak2; Jennifer Sweeney Tookes3;   TYANDLE@EMORY.EDU
1EMORY UNIVERSITY, Atlanta, GA, USA; 2Goucher College, Baltimore, MD, USA; 3Georgia Southern University, Statesboro, GA, USA;

Commercial fishing depends on specialized infrastructure (e.g., docks, processing facilities, ice houses). However, analysis of the changing locations and uses of these facilities is limited, particularly in North American fisheries economics. (A notable exception is Watson Johnsons 2012 related analysis of landings patterns following the 2003 buyback of ground fishing rights). Existing analysis is usually grounded in aligned disciplines (e.g., anthropology, sociology), and focused on the impact of issues such as gentrification (Colburn Jepson, 2012; Jacob et al, 2010), climate change (Colburn et al 2016), or hurricane impact (Ingles, 2007; Steanes Padgett, 2011) on infrastructure and communities.

One reason why economic analysis of fishing infrastructure lags is the poor data availability. For example, while Georgias fishing industry landed over eleven million pounds of seafood, worth $16.8 million dollars in 2017 (GA DNR 2018), the last time a comprehensive dock census was completed in 1975 (Nix et al, 1975), over 40 years ago. Without these basic current data, analysis of local commercial fishing economic conditions is problematic at best.

This study presents the results of a longitudinal analysis of the changes in conditions, uses, and locations of commercial fishing infrastructure between 1975 and 2019. All locations documented in 1975 were visited, geocoded, and conditions (including vessel usage, facility availability, etc.) documented. This was supplemented by title searches, regulatory records, interviews with facility owners (when possible), and other primary and secondary documentary searches. The result is a spatial and economic analysis showing the shifting pattern of fishing industry activity and infrastructure use over the last 40+ years. Implications for both analysis of the Georgia seafood industry, and for expanding this type of analysis across broader geographic areas are drawn.

14:24 – 14:42  |  3586709

Variable costs of Florida's multispecies reef fishery fleets

Molly Stevens1; Juan Agar2; Jerry Ault1; Steve Smith1; Nelson Ehrhardt1;
1University of Miami, Miami, FL, USA; 2NMFS Southeast Fisheries Science Center, Miami, FL, USA;

Federal commercial fishery permits required to land and sell reef fishes in the South Atlantic and Gulf of Mexico are used to regulate fishing effort for a wide variety of species, gears, and habitats in the multispecies reef fishery. The goal of this research was to partition the Florida reef fishery into representative fleets that facilitate the most accurate estimate of the costs of fishing effort, a principal metric used in stock assessments. Reef fish fleets are subject to different federal regulations on the western and eastern coasts of Florida distinguished by permit type (Reef Fish, Snapper-Grouper Unlimited Trips, Snapper-Grouper 225 lb Trip Limit), region (South Atlantic, Gulf of Mexico), gear (hook-and-line, longline, spear), and target species (e.g., gag grouper, yellowtail snapper, etc.). Trips among fleets varied by vessel length, duration, and variable costs (e.g., fuel, bait, ice, tackle, grocery, etc.). Regressions of fleet monthly variable costs as a function of vessel length and trip duration were differentially successful in explaining percent variation: (1) hook-and-line [55.3, 75.1]; (2) longline, 26.5; and, (3) spearfishing [10.0, 35.9]. Trip expenditures and duration clustered by fleet, and these were significantly different among fleets within target species (ANCOVA, p < 0.0001, R2=[61.2, 85.3]). Fleets with overlapping fishing region, permit type, and gear were not significantly different among target species (p=0.6811). This may indicate that fleet characteristics are more important drivers of variable costs than target species. These functions can be reliably used to estimate variable costs associated with nominal effort in the multispecies fishery. Since stock assessments use catch per nominal unit of fishing effort as a principal metric to estimate population sizes, fleet-specific variable costs of effort can broaden the basis of sustainability metrics in the management of multispecies reef fisheries.

14:42 – 15:00  |  3614938

An age-structured backward-bending supply of fish: Implications for conservation of bluefin tuna

Martin Smith1; Qingran Li1; Rachel Karasik1; Martin Quass2; Julia Bronnmann3;
1Duke University, Durham, United States; 2German Centre for Integrative Biodiversity Research, Leipzig University, Germany, Leipzig, Germany; 3German Centre for Integrative Biodiversity Research,, Leipzig, Germany;

The backward-bending supply curve in fisheries shows that under open access, the steady-state supply of fish can decrease as price increases (Copes 1970). This result challenges microeconomic intuition for strictly upward-sloping supply, and it results from the non-monotonicity of the logistic biological growth function combined with the inability to exclude entrants to the fishery. Simply put, the long-run supply of fish cannot continue to grow as fishers spend more effort catching fish because catches exceed the regenerative capacity of the fish stock. Here we extend the bioeconomic model of a backward-bending supply of fish to an age- structured population. The age-structured model endogenizes fishing mortality and accounts for detailed fish life history using multiple state variables. Analytically, a system of implicit functions characterizes the backward bending steady-state supply, in contrast to the textbook single-state model. We prove that, with some simplifying assumptions, the steady-state supply bends backward for an age-structured population. We then parameterize the more general age-structured model using data for the Eastern stock of Atlantic Bluefin tuna (1950 to 2015). The numerical Bluefin supply curve bends backwards above the current ex-vessel price and below historic real prices from the 1990s. Re-estimating the model allowing for a cost shift due to management finds that the backward-bending price is far above current price and dramatically below it before the 1990s when the fishery was plausibly pure open access. The results suggest that market developments, including growth in closed- cycle aquaculture, can influence the stock condition, but strengthening management will more reliably conserve stocks.


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