Port Lincoln’s Tuna Industry “Struggling To Make A Dollar”ff

Source: Adelaide Now

Famed for its millionaires, its seafood, and its tourism, Port Lincoln is an isolated city whose varied riches have made it a success story.

The pristine coastline and the tuna and great white sharks that inhabit it helped create a city that is a seafood and tourist Mecca, home to a luxury hotel and million-dollar waterfront homes.

But now the state’s $400 million seafood capital is on its knees as it grapples with changes to catchment quotas, low fish prices and high costs.

The city is reeling from a decision to slash tuna quotas, as the cut translates to job losses throughout the community.

In October, the Commission for the Conservation of Southern Bluefin Tuna voted to reduce Australia's tuna quota by 24.7 per cent in 2010, and again in 2011, amid fears of diminishing fish stocks.

Fishing companies are restructuring and cutting staff to adjust to the new quota, which was announced just five weeks before tuna boats made the annual pilgrimage to the Great Australian Bight.

Already battling the fallout from the economic downturn and halved tuna prices, industry leaders warn Port Lincoln’s fishing sector is running out of belt to tighten.

Some companies have reported sacking half of their employees in an attempt to get through the summer tuna harvest without going bankrupt.

The city’s $200 million-a-year tuna industry employs close to 2000 of the city’s 14,000 residents, and while the town is renowned for its millionaires, industry leaders say companies are now struggling to make a dollar. Dave Blacker, a Port Lincoln-based tuna fisherman and co-owner of Eyre Tuna, says the quota decision has pushed his company to the brink of bankruptcy.

“The truth of it is the companies here haven’t made money for three years - they have just been keeping their heads above water,” he said.

“I have had to drop staff, and it is not like they can go to work for one of the other companies because you are seeing the same situation right across town.”

Stehr Group financial controller Anthony Ellin said if tuna prices remained at last year’s lows, it could spell the end of Port Lincoln as a fishing town, saying: “It is not just the quota cut, it is the quota cut on top of last year which was just awful. It was the perfect storm, low price, low dollar, low everything. If we get prices like last year, then the banks are going to own one big tuna company in Port Lincoln.”

The town’s fishermen say the commission's decision was a slap in the face for the Australian industry, which has adhered to regulations for the past 20 years, while Japan has admitted to overcatching the species by 200,000 tons over that period.

As an added insult, they say the scientific models used to justify the allowance change couldn’t be further from the “ground truth” they are witnessing at sea, and the decision is politically motivated.

Industry heavyweight Hagen Stehr agrees, saying his company caught two-thirds of its annual quota in a day-and-a-half of fishing in December - the quickest catch in 45 years.

He is adamant the fish are plentiful, but to adjust to the new requirements the Stehr Group will employ 25 per cent less staff and send only nine cages compared to 16 last year.

Mr. Stehr estimates the 2500-tonne quota cut over the next two years will cost the industry $62.5 million.

“It will have a waterfall effect with the whole fishing industry, with packaging, producing, aeroplanes, services.”

Joe Puglisi, one of the pioneers of the Port Lincoln fishing industry, says the science used by the commission, which is based on a 1940s stock assessment, conflicts with what he is seeing on the ground.

“I can remember taking out three aircraft and they would fly all day to find one patch of fish, now one aircraft can fly and find 300 patches; the species is in very healthy condition,” he said.

“It is ridiculous crap, there is a lot of politics going on. (Environment Minister Peter) Garrett had to have a win and the tuna industry was the one that copped it.” Twenty years ago, when quota cuts were first imposed on the town, the decision led to an industry reinvention.

Tuna ranching - the farming of tuna in ocean pens - was born and aquaculture was given a massive leg up.

This time around, opinions are mixed as to how the industry can withstand the latest challenge, but all agree it will test the industry’s limits.