Icicle Seafoods and Peter Pan Seafoods have each offloaded millions of dollars worth of stockpiled canned salmon, courtesy of the United States Department of Agriculture. The department paid less than the 10-year average wholesale value for the product.
At the urging of Sen. Lisa Murkowski, Secretary of Agriculture Tom Vilsack authorized the U.S. Department of Agriculture to purchase up to $30 million worth of surplus canned Alaska sockeye salmon that’s been crowding processor storage since a blockbuster 2014 season in Bristol Bay.
USDA bought $22.5 million of canned sockeye from Peter Pan’s Astoria, Ore., plant and Icicle’s Egegik plant. Icicle sold $11.8 million. Peter Pan sold $10.7 million.
The product was sold in cases of 24 7.5-ounce cans between $31.4 and $36 per case. At 11.4 pounds per case, the USDA paid between $2.75 and $3.16 per pound for the canned sockeye, a total of 7.6 million pounds.
Between 2005 and 2014, the average wholesale price for canned sockeye halves was $3.64 per pound.
The average ex-vessel price for the same period was $1.12 per pound. In 2015, fishermen in Bristol Bay, Alaska’s largest sockeye fishery, received initial prices of 50 cents per pound.
Salmon producers took part in a bidding process to decide whose sockeye the USDA would buy. The Emergency Food Assistance Program, or TEFAP, will distribute the salmon nationwide to dozens of food relief centers between Oct. 1 and Feb. 29, 2016.
The USDA purchase is part food-based charity and part industry assistance. Alaska’s congressional delegation implored the USDA to make the purchase for the health of fishermen.
“The 2014 harvest of Alaska sockeye salmon was the second highest harvest in the past 10 years, and this year, total sockeye harvest has exceeded 35 million fish, a very large harvest,” wrote Murkowski in a letter to Vilsack dated July 29. “As a result, seafood producers are holding onto an unprecedented inventory of canned sockeye salmon, which only continues to grow. The purchase of Alaska sockeye salmon under the Section 32 authority (will) result in important health benefits for the low-income Americans who rely on USDA-supported food assistance programs.”
Indeed, the stockpiled Bristol Bay 2014 harvest coupled with a strong U.S. dollar, ample foreign-farmed salmon, and complications with key export destinations to create a soft markets for Alaska wild sockeye. Unloading the extra canned salmon could be a much-needed pressure valve.