Demand Conditions and Dynamics in the Southern and Eastern Scalefish and Shark Fishery: Empirical Investigation
The FRDC HDR has identified the lack of information on markets and price formation in Australian fisheries as a major research gap. The need for such analyses has also been discussed within the AFMA Economics working group, as such information was seen as essential in supporting fisheries management.
This project is an attempt to reduce this research gap. In doing so, the information produced will be of benefit to fisheries managers, fishers and the broader community as we move our fisheries closer to maximising net economic returns.
The focus of this study is on the markets relevant to the Southern and Eastern Scalefish and Shark Fishery (SESSF), which is the main supplier of fresh fish to the Sydney and Melbourne markets. To date, only very limited empirical research has been conducted for these fisheries in Australia [4-6], most of which is now fairly old and is unlikely to be valid for current market conditions. Since the early 2000s the seafood market in Australia has changed, for example, due to increasing seafood imports and increasing domestic aquaculture production. Hence, market dynamics for products supplied by domestic fisheries may have also altered.
This case study was identified by the FRDC HDR as of high importance due to the current challenges facing the fisher in terms of unfilled quotas. One potential contributing reason that quotas are not being taken is that to do so would result in lower prices; of potential benefit to consumers but not to producers. Instead, the lower catches may be supporting higher prices. The outcomes of this project can provide insights into the extent of to which the marker is contributing to quota undercatch.
The study will focus on the impact of changes in supply on the price received on the markets. While the potential response of fishers to these changes in price (including avoiding large catches) is also of relevance to fishery managers, this will require further bioeconomic modelling work that is beyond the scope of this study, but may be seen as a high priority for future research.
Final report
Data for the Melbourne market were limited following the closure of the central market in 2010. Despite this, the results of the cointegration analysis indicate that the Sydney and Melbourne markets were highly integrated over the period of the available data. That is, prices for a given species on each market tended to move together. Hence, the two markets can effectively be considered a single market, at least for the key Southern and Eastern Scalefish and Shark Fishery species examined. Differences in prices on the markets can still exist due to differences in transport costs, but price variations beyond these transportation cost differences are temporary.
On the Sydney market, prices of most species were found to be not cointegrated (i.e., not substitutes), but some cointegration was observed. In particular, Blue-eye Trevalla was cointegrated with several species suggesting this may be a market leader or at least a highly influential species in the market.
Imports were also found to be cointegrated with many of the species on the Sydney Fish Market, particularly imports of fresh fish. This indicates a strong substitution potential between imports and domestically caught fish, with increased import supply most likely having a negative impact on prices of Southern and Eastern Scalefish and Shark Fishery species.
From the results of the aggregated demand model, the increase in the quantity of imports has had a negative effect on the price of wild-caught species on the Sydney Fish Market over the last two decades, supporting the results of the cointegration analysis. Imports of fresh fish was found to have had a significant negative impact on the prices of species in the lower valued group in both the short and long term. While no short-term impact on high valued species was found, a small but significant negative impact was found in the long term. This suggests direct competition and potential for substitution between imports of fresh fish and the lower valued domestic fish species. In contrast, imports of frozen fish were found to complement lower valued species. That is, increased imports of frozen fish were related to increased prices for these lower valued species. No significant relationship between frozen fish and higher valued species was found.
The increase in salmon production was also found to have had a negative impact of prices of both groups (high and low valued) on the Sydney Fish Market, more so that imports.
At the species level, own-price flexibilities were generally found to be between -0.3 and -0.6, indicating that prices change less than proportionally with quantity landed (i.e., are relatively price inflexible). That is, a 10 per cent increase in quantity landed, for example, of each species would result in a 3 to 6 percent decrease in its own price. Cross-price flexibilities – the impact of landings of one species on the price of another – were also found to be small, mostly between 0 and -0.1.
Identification of factors which impact on the profitability of individual GABTS operators and the fishery as a whole
SESSF Monitoring and Assessment – Strategic Review
There is increased awareness of the need for ecosystem-based fisheries management, with increased public expectations for sustainable management of fished stocks. However, reduced catch levels and increasing costs have stimulated industry calls for reductions in management costs, or for more effective use of the existing cost-recovered funds. Budget limitations have already led to annual fishery independent surveys (FIS) carried out less frequently, reduced observer monitoring (ISMP) to fund other projects, alternation of FIS and ISMP from year to year, use of Crew Member Observers (CMOs) to collect on-board length frequencies, retaining species at lower tier assessments instead of Tier 1 assessments, ad-hoc implementation of more multiyear TACs combined with adhoc implementation of break-out rules, reduction of the frequency of Tier1 stock assessments, and the postponement of critical Tier 1 stock assessments. Whilst all of these approaches are feasible and practical responses, their combined influence on the effectiveness of the monitoring and assessment at achieving desired management objectives has not been tested or demonstrated.
Current budget restrictions on AFMA have resulted in a departure from scheduled monitoring and assessment work, with increasing ad-hoc decisions about which components of that work undertaken each year. There is growing concern by stakeholders that the present monitoring and assessment program is incapable of addressing these developments. SETFIA and other industry associations are particularly concerned that fishing concession levies funding current arrangements will become unaffordable.
Given AFMA's legislative objectives to ensure ecologically sustainable development, to maximise net economic returns and to ensure cost-effective fisheries management, AFMA has proposed this project to develop proposals for a structured and cost-effective research, monitoring and assessment program to respond to requirements and emerging issues in the SESSF over the next 5 years. It may be possible to extend this horizon should a fully quantitative project follow this proposal.
Final report
FRDC-DCCEE: adapting to the effects of climate change on Australia’s deep marine reserves
Australia’s highly endemic deep-water coral communities are under a current and accelerating threat of being squeezed out of existence, between seamount summits typically deeper than 1000 m. and carbonate levels that are falling and pushing the saturation horizon towards the surface. This horizon, below which the reef-forming corals apparently cannot grow (Guinotte et al., Front. Ecol. Env. Sci., 2006), has already shoaled by 50-130 m in the last 200 years due to industrial CO2 emissions (Thresher, et al., ms). Under-saturated water is likely already encroaching on the reef, which recent surveys found is just below the current saturation horizon (Thresher, et al., ms), and not above it, as expected. There is real risk that the reef is already stressed and may even be dying. The problem will only get worse. Under a “business-as-usual” scenario, even the tops of the seamounts will be under-saturated in the next 50-100 years. With nowhere to go, Australia’s cold-water reefs could “simply disappear” (Poloczanka, el al., Ann. Rev. Oceanog. Mar. Biol., 2007).
There are presently no adaptation strategies for dealing with this threat, nor even any research on strategies, even though it challenges the key objectives of the SE Commonwealth Marine Reserve Network, and the survival of deep-sea reefs globally. This project, developed in consultation with DEWHA, will evaluate the magnitude of the threat to Australia’s key reef-forming species, and identify and test management options for adapting to it. It addresses NARP priorities for determining ecosystem vulnerability and the feasibility of intervention and adaptation strategies.
Final report
Effects of Trawling Subprogram: assessment of bycatch in the Great Australian Bight Trawl Fishery
The GAB Management Advisory Committee (GABMAC) and the GAB Industry Association (GABIA) have raised concerns that they do not have the data necessary to assess the GABTF's compliance with ESD principles. If the core objectives of The National Policy on Fisheries Bycatch are to be implemented for the GABTF, there is an essential need for baseline data on bycatch to be gathered. Once this information is available, they will be able to determine if bycatch levels are acceptable or if there are particular times or regions in which the bycatch levels in the GABTF are deemed too high. When a comprehensive understanding of the nature of the bycatch issue in the GABTF is established, it will be then possible to investigate the most appropriate ways of reducing the levels of bycatch.
Final report
Development and application of a combined industry/scientific acoustic survey of Orange Roughy in the Eastern Zone
The primary need is to remove the uncertainty surrounding the status of the orange roughy stock by performing a combined CSIRO high precision research vessel and industry surveys of the Eastern zone during the 1999 spawning season. Following reanalysis of available information, most recent assessment indicates reduction of catches by 50% or even closure might be necessarry to meet AFMA's performance criteria for this fishery. However, recent catch and effort data (that is not used in the assessment), recent ageing data, and fisher's observations together suggest that the assessment may no longer accurately represent the population dynamics of the roughy. If these observations can be substantiated by an accepted biomass assessment (requring industry and CSIRO cooperation to get coverage plus precision), the potential savings to the industry are 1000-2000 t quota at say $4/kilo = 4-8 million per year.
There is a second need, to assess the ability of industry sounders to monitor the state of the resource. Industry monitoring of the stock could prove less costly than high precision scientific surveys. However a number of questions remain unanswered regarding industry vessel acoustics precision and sensitivity. Clearly industry-based surveys need to be carried out with calibrated sounders and to conduct biological sampling of fish marks with fin-mesh liners in the codends. However further questions remain regarding the precision that can be obtained from vessel-mounted systems that are susceptible to sea state, vessel noise and stability. To what extent then do industry sounders have the ability to map schools and relative biomass over a given season?
To test the power of the industry sounders requires a controlled experiment. This can be achieved by conducting acoustic surveys simultaneously with the common 28 kHz industry sounders and the scientific 38 kHz vessel-mounted and towed systems. This was attempted in 1996 in an opportunistic manner. However, a logger borrowed from the industry and set up on the Southern Surveyor's 28kHz echo sounder soon failed, so no useful data were collected. A more rigorous attempt to incorporate industry acoustics is required.
Final report
Stock structure of Australian populations of orange roughy using microsatellite analyses
Despite the past studies, the question of the stock structure of Australian orange roughy remains unresolved. Broadly, the evidence supports the concept of somewhat localised stocks although with some inter-stock migration - it is really the extent of the migration that remains unknown.
Current management plans are largely based on the premise that southern Tasmanian fish are from a distinct stock from St Helens Hill fish, yet evidence in favour or opposing this proposition is weak.
We propose here an analysis of the stock structure of Australian orange roughy based on the examination of DNA microsatellites. DNA microsatellites will enable a more powerful analysis of genetic stock structure than has hitherto been possible. The study will focus on the relationships of fish from eastern Australia (New South Wales, St Helens Hill, southern Tasmania) but will also examine samples from the Tasman Sea (in particular Lord Howe Rise), New Zealand, and, as a presumably reproductively isolated population, the North Atlantic.