Oregon's seafood industry is losing a major market as restaurant dining rooms across the country close to reduce the spread of the new coronavirus.
The Dungeness crab fishery generates about $170 million a year in revenue for the West Coast commercial fishing fleet.
Courtesy of National Oceanic and Atmospheric Administration
Seafood processors across the Northwest say they’re shifting gears quickly to make up for the loss in restaurant sales. They’re putting more seafood in the freezer and selling more to grocery stores.
Northwest seafood processor Andrew Bornstein said grocery stores are buying more seafood now because so many people are stocking up in response to statewide orders to stay home. But that doesn’t mean his business isn’t taking a big hit.
“Does the increase in grocery make up for a lack of restaurant business? No, not even close,” said Bornstein, who manages Bornstein Seafoods. the company has seafood processing plants in Astoria, Oregon, and Bellingham, Washington.
For some seafood items like Dungeness crab, restaurants and casinos make up about 90% of the market, he said. Meanwhile, big events like crab feeds and seafood festivals that also drive a lot of sales are now canceled or postponed.
So, he and other processors have stopped buying Dungeness crab from fishing boats, and they’ve had to put a large portion of this year’s hefty catch in the freezer to wait for better markets.
Oregon's crab fleet started fishing in January and has already landed more than 18 million pounds.
“We bought it all. We stockpiled it. And now we have no market for it,” Bornstein said. “With Dungeness, in particular, the processors are really going to suffer for the next year.”
Tim Novotny of the Oregon Dungeness Crab Commission said that means some smaller boats that typically continue fishing for crab through the summer are losing a key source of income at a time when prices are usually going up.
“For a lot of these small and medium-size boats it’s really going to be a devastating season,” he said.
The fleet’s losses from the new coronavirus outbreak started in January when China stopped importing high-priced live crab from Oregon, Novotny said.
Now, he said, he knows it will be harder for American consumers to get fresh crab but he’s hoping people will continue to buy seafood wherever they can find it.
The economic hardships for fishing fleets and processors have prompted a group of lawmakers to push for the inclusion of aid for the industry in an economic relief bill being negotiated in the Senate.
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Tony Dal Ponte, director of government affairs for Pacific Seafood, the largest seafood processor on the West Coast, noted seafood plants have been deemed essential businesses that can remain open under the latest measures aimed at containing the spread of the virus.
So far, he said there have been only “minimal and hopefully temporary” layoffs at his company, but without the restaurant market his business will take a hit and it’s unclear how long the closures will last.
According to the National Oceanic and Atmospheric Administration, he noted, 68% of the money Americans spend on seafood is spent on dishes prepared for them by a restaurant or other food service.
Pacific Seafood plants have been adapting to the new, restaurant-free market by focusing on selling frozen inventory to grocery stores and products that are easier for consumers to prepare at home.
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“Retail demand is up, yes, but they're demanding different types of products,” Dal Ponte said. "Most people are buying staples like chicken and red meat, or some of these frozen fish fillets.”
His company is changing the way it processes the seafood it buys from fishing boats to make “ready to eat” or “ready to cook” types of products for people to buy in grocery stores. Nevertheless, he said, the seafood business is still hurting from restaurant closures designed to slow the spread of COVID-19.
“The unfortunate reality is that these are unprecedented times,” Dal Ponte said. “The unprecedented public health measures, while necessary and well-intentioned, have caused significant economic disruption throughout the U.S economy and we’re unfortunately not immune from that.”