Cannery sale may benefit value-added fish market

Posted: Wednesday, January 12, 2005

A group of area commercial fishers are negotiating a deal to purchase Dragnet, a shut-down seafood processor, said Jack Brown, business development manager for the Kenai Peninsula Borough. The purchasers plan to make a portion of the new operation a value-added processor in what Brown believes could be a boost to the value-added processing market.

Value-added fish are higher quality custom-made products that fetch higher prices.

"It's an exciting event to have a cannery that was not in operation for many years come alive," Brown said.

The old Dragnet seafood processor, by the city dock off Bridge Access Road, shut its doors in 2000 after the owners went bankrupt, said Gene Shadle, caretaker for the old processor.

When the processor was running at full capacity, it employed up to 170 people, he said. In its heyday in the 1980s, it dealt with a variety of fish but was only processing salmon from driftnet and setnet fishers, he said. Now it is an empty building waiting for some new owners, he said.

Because negotiations to purchase the cannery are not complete, Brown said involved parties are not yet ready to release information on the purchase. He said it was exciting for the future of Kenai Wild and production of other value-added fish.

Kenai Wild is a trademarked brand of salmon aimed at increasing the quality and value of Cook Inlet fish, Brown said.

To be branded Kenai Wild, high-quality custom cuts of salmon are iced at the point of capture immediately after being caught, said Sylvia Beaudoin, executive director of Kenai Wild. They are then inspected by a third party that grades the fish, she said.

The program is entering its fourth year and has increased production each year, Brown said. This year, the goal is to produce 1 million round pounds of salmon, he said. A round pound is the weight of the fish upon delivery to the processor.

Brown said the domestic demand for wild fish is increasing.

"They are demanding we produce a high-end fish," he said.

Beaudoin said this has led to an increased interest in and a growing market in producing value-added fish among processors that has helped launch the Kenai Wild brand. With the growing market for value-added, there is an increased demand for processors that can handle larger volumes of this product, Beaudoin said.

"It's an important step in our evolution," she said.

Paul Dale, president of Snug Harbor Seafoods, said the domestic market has an increasing appetite for sockeye salmon. As the market has grown, he said his company has increased their production of value-added salmon.

Brown said because many traditional seafood processors are obliged to produce large volumes of fish for their customers, it is difficult for many to handle a lot of value-added fish. He thinks Dragnet could be another way to meet this demand.

Beaudoin said Kenai Wild is working with and encouraging seafood processors to transition portions of their operations to custom value-added processing. This will help fishers who want to be able to deal with this portion of the market see the product from the time it is caught until a final packaged product is complete, giving them more control, she said.

Elizabeth Chase, a Kasilof fisher, said she is excited about the possibility of Dragnet reopening and offering custom processing. She said her current seafood processor does not custom pack small amounts of fish. A smaller processor could give her more options on how to package and sell her product, she said, ultimately getting a better price for her fish. They would be able to handle the small amounts of fish the more traditional seafood processors do not, she said.

"Getting a better price keeps our livelihood afloat," she said.

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