Over the last decade, the capital value of the abalone quota units and the beach price per kilo for wild-caught Abalone
has dropped by about 50% (after allowing for inflation). The main reason for this decline in industry value is more competition - particularly from farmed abalone, although currency fluctuations have also played a role.

The most important market for Australian abalone products in terms of both volume and value is currently mainland China. Demand is subject to normal economic forces, but appears to be fairly constant. However, in a market that is growing in line with the Chinese economy, Australian abalone returns and capital growth have been steadily declining since 2000.

No specific activities aimed at positioning Australian Wild Caught Abalone have been undertaken with customer (restaurant) or consumers. The industry has principally operated as an export sales function, building strong relationships with Chinese importers, but further down the supply chain, there has been no involvement by Australian stakeholders.

It is the view of the Abalone Council of Australia that a serious commitment to trialing a product differentiation strategy and an associated marketing effort in China is required to ascertain whether it is possible to prevent further economic damage and start improving the value of unit holders’ investments.

Research to date suggests that the best opportunity is to establish a program that increases demand for Australian Wild Caught abalone in Chinese restaurants specifically targeting the emerging mass affluent consumers.

The Strategic Plan summary reports as follows:
For all its economic promise the industry faces some challenges that constrain growth and profitability:
• Lack of appropriate peak body structure and supply chain fragmentation
• Limited enterprise commitment to joint industry development
• Complacency in dealing with market issues – predominant wild caught focus
• Limited sectoral or peak body strategic planning
• Policy dominated by resource managers and technologists rather than those with commercial and market experience.

The industry structure comprises around 300 small owner operator businesses with little or no capacity to coordinate investment in and manage industry development. Recovering lost industry value and delivering future growth is contingent upon coordinated investment in industry development at the whole of industry level.

The ACA is now established and well positioned with the CRC to implement its strategic plan and to integrate R&D work across all stakeholders under its leadership. Two distinct needs are involved in any consideration of better national R&D co-ordination for the abalone sector:

1. The strategic issues of R&D prioritization, funding and the linkages to (and support for) both industry development plans and Government objectives of industry development.
2. The operational issues of facilitating effective communication and coordination at all levels (industry/researchers, among researchers, among industry, FRDC and researchers etc).

The FRDC has requested the development with respect to abalone of “an application that takes a national approach to management strategy evaluation development and implementation. This should include economic, environmental, social and governance indicators.” In order to achieve this a workshop is proposed that brings together representatives from Industry, Management and Research from the abalone producing States plus other invited experts in abalone and management strategy evaluation.

There are R&D initiatives in most Australian fisheries and NZ to collect finer scale and more comprehensive data about abalone populations and fishing. These initiatives are also highlighted in the “Harvest Optimisation” and “Sustainability and Environment” investment platforms of the ACA Strategic Plan, within several Objectives including to “Establish management tools and models that enable targeted harvesting of fish to optimise market returns”. It is not yet clear how or what finer scale data will be used to generate the most informative fishery Performance Indicators, although MSE will provide the structure to assess this.

To maximize the value of outcomes from the proposed Workshop, the ACA needs to focus on the strategic direction of finer scale data collection, its incorporation into fishery Performance Indicators and their assessment through techniques such as MSE. Such a focus would allow the ACA to participate in the Workshop with a clear plan for R&D investment in these important directions.