March 2, 2017
The value of other global currencies has a big influence on seafood sales, along with market supply and demand. The U.S. dollar value increased 27 percent between 2011 and 2015, serving to push down the dockside value of Alaska seafood by 17 percent at the same time. The dollar index was roughly unchanged last year and signals are mixed today.
“But this year it has been more of a mixed bag. The Euro is still trending weaker who knows if that will continue but that has been the trend for the last three years.
Andy Wink is Senior Fisheries Analyst with the McDowell Group.
“Basically, one Euro was worth $1.10 in US dollars last year and now it only buys about $1.05. So as the Euro buys less dollars, it takes more Euros to buy things denominated in dollars. As that number comes down, it’s typically not good for people who export goods to Europe because it requires European buyers to pay more Euros so the price usually adjusts downwards.
Moving outside of salmon, pollock fillets are one of the biggest exports Alaska has and a lot of that goes into Europe. That’s been a product under a lot of price pressure and the currency market is not doing us any favors. Cod is another product that goes to Europe a lot, so it’s going to make things tougher for cod. Pollock surimi is another one. All of those products are going to face a tougher marketing year than the previous year.”
What about for one of Alaska’s biggest seafood customers: Japan?
“For right now the yen is getting stronger. It used to be around 120, so you could exchange one dollar for 120 Yen, and now that’s closer to 112, so the dollar isn’t worth as many Yen as it was just a few months ago.”
Overall, the brightest spot now appears to be sockeye salmon.
“We had a pretty good sockeye harvest and the market has been soaking up that supply pretty regularly. Farmed salmon prices are high and we are supposed to have some growth in farmed supply this year, but I think it will be below average. But things look pretty good- better than last year. So now it’s a matter of whether we get the fish.”
Another big unknown is how Donald Trump’s new policies might impact trade.