Increase the economic value of Alaska seafood resources.
- U.S. and International Retail and Foodservice Alaska Seafood Promotion, Public Relations and Communications and Seafood Quality Technical Support
|Mission Results||Core Services|
|A: Result - Increased economic value of Alaska seafood resources.|
Target #2: Maintain first place ranking of Alaska Seafood among the most popular food brands on U.S. restaurant menus.
Analysis of results and challenges: In 2018, Alaska Seafood maintained the #1 ranking for the third consecutive year. In 2016 Alaska Seafood, for the first time, obtained the #1 most commonly named protein brand called out on restaurant menus, surpassing Angus Beef. In another study of United States consumers conducted by Dataessentials in January of 2016, 87% of consumers reported being more likely to order a fish/seafood dish if the Alaska Seafood logo is on the menu and 94% of consumers reported being more likely to order a fish/seafood dish when the word “Alaska” is on the menu.
|A1: Core Service - U.S. and International Retail and Foodservice Alaska Seafood Promotion, Public Relations and Communications and Seafood Quality Technical Support|
Target #1: Increase the aggregate value of Alaska seafood exports to Alaska Seafood Marketing Institute (ASMI) program destination countries by 0.5 percent annually.
Analysis of results and challenges: Export markets are critical to Alaska’s seafood industry accounting for 60 to 70 percent of first wholesale value each year. Growth in export volume and value helps maintain markets for Alaska seafood and supports higher values for the State’s annual production.
• In 2017, the value and volume of exports to ASMI program countries rebounded sharply after two consecutive years of declines, increasing 19 and 13 percent from 2016 levels, respectively.
• A weaker U.S. dollar, product innovation by processors, a much larger and more valuable salmon harvest, and price improvement for some groundfish species are the primary factors contributing to 2017’s success.
• Growth in export values to China and Japan were the drivers of the overall increase. In 2017, $989 million worth of Alaska seafood was exported to China, a 25 percent increase from 2016; exports to Japan increased 27 percent to $770 million. Growth occurred in all other ASMI program markets, except Central Europe and Brazil.
• Due primarily to fluctuations in harvest volumes, growth rates fluctuate significantly from year to year. A long-term perspective is preferable when considering growth trends. Over the last decade, the CAGR in export value is 3.3 percent—well above the 0.5 percent annual goal.
• While export value to ASMI program countries increased 19 percent in 2017, exports to non-ASMI program countries declined 10 percent.
Summary of market challenges and opportunities:
It will be difficult for 2018 export values to see significant improvement from 2017 levels due primarily to declines in harvest volume for key export species. Compared to 2017, pink salmon harvests are down significantly. Although some of this decline is expected, preliminary 2018 pink salmon harvest figures are below typical even-year harvests. Reduced quota and harvest volume for Pacific cod will also challenge growth of export values, even with an increase in value.
Trade disputes with key markets could reduce demand, particularly in China.
The strength of the U.S. dollar affects Alaska seafood exports. A strong dollar makes Alaska seafood more expensive on the international market, while a weak dollar makes Alaska seafood relatively affordable. Between late 2016 and the first quarter of 2018, currency rates moved in a direction favorable to Alaska seafood exports. In the second and third quarters of 2018, the U.S. dollar has strengthened, although it remains well below the peak observed in 2016.
Target #2: Increase the ex-vessel value of key species in Alaska's commercial harvest by 0.5 percent annually.
Analysis of results and challenges: The harvest (ex-vessel) value of Alaska's commercial seafood incudes payments from processors to commercial fishermen and estimated value of product caught by catcher-processors. Increasing the harvest value of Alaska seafood benefits Alaska residents, in the form of economic activity and opportunity, along with state and local taxes.
• Preliminary 2017 ex-vessel value data show key commercial seafood species totaled an estimated $2.0 billion in 2017. Final ex-vessel data on federal groundfish species for 2017 are not available until December.
• Compared to 2016, total value of these key species expanded 12.6 percent in 2017 due primarily to a very strong salmon harvest. Halibut and sablefish values expanded slightly; preliminary figures also indicate pollock and rockfish values increased. Pacific cod, crab, and flatfish values likely declined or were flat against 2016 levels.
• A CAGR of less than 0.4 percent was observed between the averaged years of 2007/2008 ($1.79 billion) and 2016/2017 ($1.86 billion), nearly meeting the goal of 0.5 percent. It is appropriate to average even and odd years to smooth fluctuations in salmon harvest values.
Summary of market challenges and opportunities:
Even with a strong salmon harvest in 2017, maintaining the annual growth target has proven difficult in recent years. Over the past decade, halibut, sablefish, pollock, and Pacific cod values have been slow to expand. In 2008, this group of species was valued at $1.28 billion; in 2017, preliminary numbers show a value of $1.01 billion for the group.
Unfavorable currency rates and competition with other species (primarily from Russia) are among the primary factors slowing a growth in value.
Conditions in 2018 are expected to further challenge attaining the annual growth target. Reduced Pacific cod quota and a difficult salmon season will reduce the likelihood of strong growth. However, some optimism surrounds pollock and other groundfish values.
Trade disputes and increased uncertainty could also place downward pressure on ex-vessel values for Alaska seafood. Export markets are vital to Alaska’s annual production and disruptions are likely to be felt across the state.
Preliminary 2017 salmon harvest values are the highest on record. And even with the difficult 2016 and 2018 season, the annual salmon harvest is increasingly valuable. Increasing values have been supported by factors including strong volumes in some years, strong consumer demand, a focus on quality by harvesters, and product and supply chain innovations by processors.
Target #3: Continue to generate target consumer awareness via consumer public relations and advertising campaigns.
Analysis of results and challenges: ASMI will continue to focus on increasing consumer awareness by using various methods of media communication including broadcast, print, social or online media public relations and through consumer promotions and campaigns in both retail and food service. In FY2018, domestic public relations efforts resulted in over 342 placements and extensive social media posts totaling over 1.1 billion impressions. Consumer retail and foodservice promotions in FY2018 earned 72.8 million impressions. In response to decreased funding, domestic consumer advertising was eliminated in FY2018; a reduction from $2.2 million in FY2016. Due to the dramatic reduction in advertising spend, consumer impressions are expected to remain at the current level. The cost per consumer impression via public relations efforts far exceeds the return Alaska seafood receives from advertising. From FY2016 to FY2017, consumer impressions earned per dollar from public relations were on average 6.5 times greater than consumer advertising.
Current as of November 12, 2019