IS CHILE FOR REAL? Chilean salmon industry ducking its head in the sand won’t help its global image!
Editorial by Bertrand Charron
February 22nd, 2008
The Chilean salmon farming industry has now - for years - been considered as the El Dorado of salmon farming’s 21st century prospects. It has in the south of the country great fjord-like coastlines, ideal sea temperatures for salmonid on-growing, an economy geared towards liberalism and international trade, and a willing workforce as well as local capital and a good logistics infrastructure. It is also well situated for frozen exports to the Japanese and US markets; both of which are proving salmon-hungry.
However, Chile is lagging far behind other salmon producing nations in how it communicates – and wishes to accept the very principle – with local stakeholders and international environmental NGOs (Oceana, Greenpeace, WWF, etc…); some of whom relate to the broad concerns of consumer groups in other parts of the world. By “industry”, we don’t just mean the salmon industry’s representative body, but all of the main players.
Labour conditions are a sore point; as exemplified by the various disputes of current (AquaChile-owned Aguas Claras) and past times. Addressing multi-stakeholders’ and environmental concerns seems to be the last point on the agenda. Growth (and now lack of.) seems to come first.
Fine - we’d say - if the industry is sustainable from a human, economical and environmental perspective. But, is it? And is the industry willing to discuss & address those issues?
It would seem not.
Now, the transparency issue is also affecting the results of stock-exchange listed companies. This week, Marine Harvest announced the planned lay offs of a quarter if its staff (1,000+) in Chile. All of this because of the poor Q4 2007 results announced last week, revised forecast & outlook for 2008-2010 due to the ISA salmon disease.
In 2000, the Chile’s salmon farming industry was going on the record (re. interview to the present writer) as casting doubts over the very existence of the ISA virus in farmed salmon in the country. This eventhough ISAv’s presence in Chilean farmed coho salmon had been reported from scientists at the Atlantic Veterinary College (AVC) at the Canadian University of Prince Edwards Island (PEI) and described in scientific literature. The OIE even confirmed last summer that ISA “had been previously detected in Chile in 1999”. Then, we were told for years that there are & were no particular ‘fish health’ or ‘biological’ problems. No sea lice issues, no ISA problems, etc... And even if there were a few ‘incidents’; by no means did these impact the industry – officially. But there were many warning lights.
Are investors truly dumb? Do they necessarily believe everything they are fed from ‘official sources’ – and should they?
Indeed, things can be kept in the dark when one is far away from the world’s markets and media. But now that Chile’s ‘salmon industrialists’ want to be part of the world globalisation & trade, have FTAs left right and centre; and sell their salmon worldwide; they can’t have it both ways! i.e. tell ‘outsiders’ not to stir things nor ask embarrassing questions; and on the other hand take the cash of foreign investors and want to be part of that global market; never mind attract the capitals of large multi-nationals, which now have to abide to published corporate ethics, and can themselves feel the full brunt of consumer & market power.
All of that even before considering the fact that stock exchange salmon farmers (Cermaq/Mainstream/Ewos, Marine Harvest) have to report their quarterly results, thus exposing some of the ‘biological and business’ facts out there. (See SeafoodIntelligence’s Børs Seafood Watch). Otherwise, we could be scrutinising the horizon for a long time through pink (salmon)-tainted glasses…
Salmon stocks have tumbled in the past months & weeks on the Oslo Børs – the most advanced in that sector. The fall in share value for the world #1 & 2 companies can be directly linked to the reduced ‘performance’ and ‘biological situation’ experienced by their Chilean operations. AquaChile, the country’s #1 producer and World #3, pulled out in October 2007 from a Santiago stock exchange listing, due to an ‘unfavourable’ market climate & also blaming the current “uncertainty” in ‘fish health situation’ [see AquaChile CEO Victor Hugo Pucci’s comment earlier this week in La Tercera: Biz & Finance : MOTIVATION to invest in Chile’s salmon farming industry? There are ‘non-economic ingredients’… (20.08.2008).].
Meanwhile - even long after Marine Harvest revised its 2007 Chilean production forecast in October and November 2007 – the Chilean industry representatives kept to the ‘Crisis? What Crisis? No Crisis!’ mantra.
Didn’t SalmonChile’s President, César Barros, deny on November 14th the ‘supposed crisis’ the industry was in, though acknowledging that 2007 did not unfold ‘as they had anticipated at the end of last year’… Even yesterday (February 21st) he was quoted in the Chilean press as saying that Marine Harvest’s decision to lay-off 25% of its workforce in Chile “will not affect the image of the industry”.
REALLY? What makes you so sure?! Are we talking about “the image” the industry wants to project of itself, or the industry's image as perceived from abroad?
Do people want to invest in Marine Harvest – thus in Marine Harvest Chile - in the light of its dismal results lately? Suffice to say that at 13.27 last Friday (Feb. 15th) - hours after releasing its ‘disappointing’ Q4 2007 results - the price of Marine Harvest’s shares on the Oslo Børs had plunged 10.36%. Since January 1st 2008 (and @ 11.12 GMT+1 on 22.01.2008), MHG shares lost 23.77% in value; and 63.81% in the past 12 months; most of this abysmal fall came after the Chilean forecast warning of October 2007…
So, is pretending that ‘all is well, regardless...’ good for the industry - never mind its image?
ISA was a (very) long time coming though… Throughout the early summer 2007 (as SeafoodIntelligence readers will recall); there was plenty of warning signs that sea lice and ISA (discovered in 1999, lets remember; and some reports even claim that sea lice could be an ISA vector) were becoming an issue in Chile. But one could only read comforting ‘no problem’ & ‘no issue’ statements.
Is Chile’s salmon industry to blame for all this? “Strongly, but not solely” would be the answer. Indeed, the Chilean establishment seems to frown upon any input from "strangers". But lets also be fair, there aren’t many countries’ industry that would welcome open-armed any & all type of criticisms. It is an arduous process which takes time and openness. But the sooner it starts the better...
So who else is to blame? Well, one could look at some of the Norwegian businessmen and US investment funds - among others - who could be accused to prioritise the ‘favourable’ economic & investment climate over a more global perspective encompassing as well environemental sustainability before taking business decisions. Low-cost labour = lower production cost, of course. But is this all? As we've highlighted many times before, a market - still very much cyclical - such as the farmed salmon one is very much linked to veterinary, fish health and environmental issues. And the latter (and/or their mediatisation) can indeed decide the fate of both price trends and multinationals' dividends...
Thus, what is 'ethically right' from an investor's perspective? And how does one balance the pursuit of economic gain with the interest of other concerned stakeholders? Lets not forget - and many salmon farmers are truly aware of this fact - that, foremost, the salmon farming/aquaculture industry's future depends as well on the well-being of the environment which supports and nourrishes it.
Intrinsically thus, the issue is NOT REALLY about ISA, sea lice or labour conditions in particular; it is about developing a sustainably industry in a sustainable fashion.
Because this industry grows salmon in great environmental surroundings, then environmental issues should be addressed. Because this industry employs people, then labour conditions issues should be addressed. Because the industry grows salmon in an environment of which it is not the sole tributary, multi-stakeholder dialogue should take place. And because this industry trades with other countries on other markets, then it should provide objective information to those markets. [Read in passing the note: INFORMATION LACKING about impact of April earthquake… How is Chile’s salmon industry affected? (13.06.2007)]
The end word of all this is that the Chilean salmon farming industry’s attitude HAS TO CHANGE and a) acknowledge that there are problems, and b) address them.
Otherwise, beware the backlash!
Other countries had to follow the same learning-curve in their dealings with other stakeholders; but Chile is now certainly not leading the pack in that respect. However close to the Antarctic as they may be, Chileans cannot live in isolation and seriously believe that a one-sided relationship with their own workers, investor’s perspective, NGOs and world media will 'do it'.
The more Chile's salmon industry resists the move towards better communication, the longer it will take to truly go forward. This is also the realisation made by some prominent members of the Chilean government (when it comes to labour dispute and its handling). All it takes is one ‘scandal’ - one ‘food scare’, and sometimes one article/news report in a prominent (but foreign in Chile's case) news media - and by means of a lack of transparency an entire industry/market could collapse; particularly in the food business.
With market access comes the need for transparency and openness. If one should only learn one thing from 2007’s “biological situation” & the stock plunges; it should surely be to admit that burying one’s head in the sand (and projecting that image to the world) is not the best business solution, right?! If players in Chile’s salmon farming industry seriously aim to make the country the world’s #1 Atlantic salmon producer; then they must work at their communication, and be pro-active in establishing multi-stakeholder dialogues as well.
And if it’s any consolation… Chile is not the only country which should improve on those fronts!
PS: A good start would also be to have some communications issued in English (we selfishly comment on behalf of environmental & business parties interested… J) as the country’s main three market are Japan, the US and the EU. It could also help, in getting their word out, if they decide to…
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Stinky Fish campaign video withdrawn… MSC not pleased & WWF does the right thing… Partly…
Editorial by Bertrand Charron
January 23rd, 2008
The WWF has yesterday (Tuesday January 22nd) removed the Stinky Fish video campaign from their website and from You Tube, without any statement explaining why. All that can now been seen is the puppet in action for a brief 11 seconds. This comes in response to a global seafood industry protest (in the US and Europe), and at the request of the Marine Stewardship Council (MSC) which had not given its backing for the use its logo. However, whilst the video has been withdrawn, all the written documents are still displayed on its Stinky Fish campaign website.
One can still read - answering the question ‘Is farmed fish better for the ocean than wild caught?’ - “Very often, farmed fish are NOT a good idea […]”. Friend of the Sea has also issued a statement yesterday to distanced itself from what it called “WWF’s MSC Everything else stinks” campaign, and demanded “more respect for consumers, the seafood industry and other certification schemes.” The MSC said “it regrets and apologises for any offence given by the campaign”… Sadly, the WWF’s very own statements are counterproductive and contradictory. When it disapproves of farmed fish - “as they are fed on fish meal made from other fish. Cannibals they be!!” - what does that make of MSC-labelled Alaska salmon?
Lets remind our readers that about a third (a massive 1.5 billion fish!) of Alaska salmon's are bred in hatcheries and fed with commercial fish feeds before being released in the wild… Could the WWF please answer?
Launched last Thursday (January 17th), the WWF’s new muppet video showed Stinky Fish sniffing fish and shouting: “It stinks!” and concluded: “Just look for MSC label: everything else is stinky!”. That video is no longer visible.
However, whilst the video has been withdrawn, all the written documents and the Q&A are still displayed on WWF's Stinky Fish campaign website. One can still read, answering the question ‘Is farmed fish better for the ocean than wild caught?’: “Very often, farmed fish are NOT a good idea, as they are fed on fish meal made from other fish. Cannibals they be!! In other words, fish farming can be used to conceal unsustainable fishing practices in the wild. Farmed fish can also be more vulnerable to disease; sometimes large quantities of antibiotics are pumped into the water in fish farms.”
Ironically, WWF introduces the Stinky Fish character by saying: “Hello there, I'm Stinky Fish, your guide to the minefield of exploitation, misinformation and plain outright confusion that is buying seafood.” In fact, misinformation and contributing to confusion is exactly what it did with the above misleading Q&A biased answer. Would there only be one type of ‘farmed fish’ to which one can compare one type of ‘wild fish’?!
'Cannibals they be!!'
Taking the role of the devils’ advocate and applying those over-simplistic criteria, what would the WWF say to the fact that a large proportion (roughly a third) of ‘wild’ Alaskan salmon (MSC-eco labelled) are in fact raised/farmed in hatcheries before being released in the wild? 1.5 billion of them a year in Alaska (65 million just north of the border with British Columbia), for the past few decades… How does WWF intend to inform consumers on these 'wild-farmed' fish (the technical term is ‘ranched’)?
The problem is that this is a ‘very hot potato’; politically in Alaska, and internationally for the MSC, among others... And we very much doubt these issues will be ‘touched’ by mainstream NGOs or industry organisation/politicians.
But by casting the evil eye on ‘farmed fish’, a can of worm is kicked open- if one deared to look - and one can also taint so-called ‘wild’ fish... How exactly do you define a ‘wild’ fish may we ask?…
Last year when the melamine-in animal feeds provoked the largest-ever US FDA food recall and food safety alert, it became apparent that the answer was not so clear cut. It also highlighted the farm/hatchery origin of many ‘wild’ Alaskan salmon, some of which were fed melamine-tainted fish feeds in 2007 and then released in the wild as it was ‘too late’ and/or that the food safety risk was deemed so negligible as to be null.
Does the hatchery-origin of MSC-labelled 'Alaska salmon' thus change the WWF take - and support - for MSC eco-certified produces? According to its own statement, it should... Indeed many millions of 'wild' Alaska salmon juvenile are & were fed "on fish meal made from other fish. Cannibals they be!!"
Best left in the dark, hey!?
You see, things are not so simple… Indeed, discussing the issue of the sustainability of wild Pacific salmon (if we include Russia and Japan, it’s about 5 billion juvenile salmon that are released yearly in the wild), the biological ‘truth’ may not meet certain ‘ecologists’ or trademen/fishermen’s arguments. Not to mention politicians and marketers.
There are many things riding on this topic. Alaska has declared a moratorium on finfish commercial aquaculture, as its fishing industry feels threatened by it and that - it is argued - the latter threatens the marine ecosystems and fishermen's bounty ... Thus, the State is resisting the development of offshore (‘open ocean’) aquaculture, as planned by the US National Offshore Aquaculture Act of 2007. In Alaska, it is interesting to note that the authorities – the Alaska Department of Fish & Game – state that they do not ‘farm’, but rather they ‘rear’ salmon. “It is important to note that Alaska hatcheries do not “farm” fish. Fish are reared to a specific juvenile size and released to fresh water lakes and streams or to salt water […]” – said the ADF&G last June at the time of the melamine-in-fish-feed crisis.
The ‘truth’ is indeed in the details. That’s why over-simplification and a non science-based populist approach to seafood and fisheries communication serves no purpose. Many have in the past made such mistakes: fishermen, anglers, aquaculturists and environmental NGOs and activists. Its time to sit and talk.
Such discussion also affects the legal and ecological ‘status’ of the five Pacific salmon species, for instance (and to stick to salmon).
Didn’t a US federal court judge in Washington rule last June that “a healthy hatchery population is not necessarily an indication of a healthy natural population.” Thus – to simplify - that hatchery salmon can not “necessarily” be considered as ‘wild’ when it comes to seeking protection for the species under the Endangered Species Act (ESA). This has huge impact... best glossed-over for the time being.
One can talk politics on the one hand, and science on the other... and many things in between. Indeed, by discussing ‘ranching’ and the release of hatchery-‘reared’ salmon, this takes us further down the topic of how to define ‘species’ and ‘populations’; and the issue of the genetic make-up of a population/fishery crops up … (Read more news on Offshore Aquaculture, ‘Wild vs. farmed’, or Sustainable Fisheries from the SeafoodIntelligence.com News Database, among others).
Background, PREVIOUSLY on SeafoodIntelligence’s Database:
Other facts about MSC-certified Alaska salmon (gathered from the MSC’s website):
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“Alaska salmon is the product most demanded by commercial buyers and the most versatile – currently there are 360 MSC-labelled salmon products available as smoked, fresh, frozen, canned, roe and ready-meal options.
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“Alaska salmon is the most widely marketed fishery that is certified under the MSC programme - MSC-labelled salmon is available in 21 countries around the world.
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“The [Alaska salmon] fishery in 2006 was worth $276 million, landed 287,000 Metric tons and had 11,300 commercial permits.
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“In 1959, statewide salmon harvests were about 25 million salmon a year. In 1999 (forty years later) Alaska's commercial salmon catch was 214 million fish, the second largest in the state's history.
While we agree that there is a need for WWF’s noble intention to inform consumers to correct ‘misinformation and plain outright confusion’ there is about seafood safety and facts; sadly we have to say that on this one, WWF blundered… and created its own outlandish misinformation.
The US media Seafood News comments that the “response [withdrawing the Stinky Fish video] shows that both these organizations realize the goal of sustainable seafood cannot be obtained without the support and participation of the seafood industry. Although some will be suspicious of working with any outside NGO, the responsiveness of both the MSC and WWF should be taken for what they are – evidence of a continued desire to work with the industry on a common goal. The fact that both organizations recognized and attempted to fix their error is to their credit.”
In the UK on Monday, the trade organisation Scottish Salmon Producers’ Organisation (SSPO) commented that the campaign was “confusing, rather than educating” for consumers.
The MSC Chief Executive, Rupert Howes, is quoted as having apologised to the seafood industry for the campaign, and has asked the WWF to remove the MSC logo and all references to the MSC from the campaign. It was done, but only partly... as we point out. Howes added that the MSC is deeply sorry for ‘any offence’ the campaign has caused and ‘is taking actions in response to the industry complaints.’
The MSC said “it regrets and apologises for any offence given by the campaign to all those partners and colleagues in the seafood industry who work extremely hard to ensure sustainable and legal fishing that results in high quality seafood products in the market.”
The WWF only partly acted on that one. As we’ve said above, some materials remains freely available. Answering another question (‘Should I stop eating seafood?’) in its Q&A, Stinky Fish says: “Well I'm a little biased on this, but there's no need to stop eating seafood because sustainably managed and responsibly caught seafood is available. And easy way to find some of the good stuff is looking for the MSC ecolabel. Asking for MSC will help push this industry to change even more. […]”
In another comment it says: “[…] Perhaps some of your friends and family do eat fish? If so you can tell them about MSC-certified seafood.”
Stinky Fish/WWF continues the promotion of the MSC in the Q&A. Not a bad thing in itself we add; but a ‘bad thing’ if that’s the only thing promoted (this was written with the same ink jet as ‘everything else is stinky!’ – now edited out)…
On that topic, read also this morning’s other article: Certification : FTS demands from WWF “more respect for consumers, seafood industry & other certification schemes” (23.01.2008)
Answering the question “How is MSC fish better for the oceans?”, it answers: “Any fishery that is certified against the MSC environmental standard has to be managed in an environmentally responsible manner. Lots of happy, uninterrupted fishy sex must be facilitated! The ecological balance of any MSC fishery must be respected. And all relevant local, national and international laws and regulations must be respected. It can get pretty complex, and it's not all black and white, but it's really starting to work. If you want to know more, just visit MSC's website.”
Thus, all in all and while we believe WWF to have taken the right first step by withdrawing the Stinky Fish video, some actions and communications still remain to be taken by WWF. The Stinky Fish campaign - well intentioned in concept - has backfired and created just that... a stink!
View the Q&As and statements from the WWF’s Stinky Fish Campaigns:
http://www.panda.org/about_wwf/what_we_do/marine/our_solutions/sustainable_fishing/stinky_fish/index.cfm
Read also Monday’s top story: Media & Lobbying : BIASED STINKY FISH: Does WWF’s promotion of MSC 'stink'? Campaign seems anything but impartial (21.01.2008).
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