SAN DIEGO - A large San Diego-based tuna fishing operation, responsible for a sizable chunk of the tuna eaten by U.S. consumers, says it is slashing the size of its fleet by more than half.
South Pacific Tuna Corp. says it is selling eight of its 14 boats to foreign companies, eliminating more than 200 jobs, because of stifling U.S. regulations that it says make it difficult to earn a profit. The company contributes to roughly 20% of the canned tuna sold in the United States.
The move is just the latest in a slow decline for the tuna business, which was the third-largest industry in San Diego 50 years ago. Environmental regulations and better fishing grounds eventually pushed U.S. companies away from California.
The sale of the boats would mean a reduction of 70,000 tons of tuna from a U.S. company, meaning more Americans would be eating tuna caught by foreign operators, who are often criticized for poor labor practices.
South Pacific Tuna Corp. is selling its boats to companies in South Korea, China and the Philippines. After the sale, there will be 24 American boats, down from 40 a few years ago.
J. Douglas Hines, executive director of South Pacific Tuna, and other operators have put much of the blame on government regulators in the National Oceanic and Atmospheric Administration, or NOAA, which can issue fines for infractions.
"We have no choice. We're pretty much forced out of business," he said.
In a statement, NOAA said the Trump administration supports the industry, advocates for its fisheries and has sought the ratification of a treaty for the area where U.S. boats and South Pacific Tuna fish. It said it has tried to reduce regulatory barriers for American boats, but had a responsibility to patrol fishing operations.
"In fulfilling our commitments under various international agreements, and as a responsible flag state, the United States is obligated to investigate and prosecute violations of conservation and management measures governing U.S.-flagged tuna fishing operations in these waters," the statement read.
Apart from regulations, the price of tuna is also a factor in making ends meet. Skipjack tuna in the Bangkok market is now going for around $1,000 per-metric-ton, down from $1,900 just two years ago, said industry seafood producer Thai Union Group (owner of California-based Chicken of the Sea). The drastic change is largely the result of an oversupply of tuna, analysts say.
Christopher Anderson, a fisheries economist at the University of Washington, said the tuna fleet has more pressure on it than just government regulations, including fees to fish in foreign waters continuing to increase. While he said one could argue those nations deserve fairer compensation, it can get to the point of pushing U.S. boats out.
At the same time, many of the foreign boats - largely Chinese - are newer than much of the U.S. fleet. Anderson said fuel and access rights to waters is often subsidized by foreign nations, not something U.S. boats get.
He also said fuel prices can be a major drain on the bottom line. Rather than burn gas cruising around the ocean, boats often use fish aggregating devices that attract large schools of tuna and are often equipped with satellite technology. It can create additional problems because the netting can inadvertently catch other species and add to fines.
Why it matters
American tuna companies say they are held to high sustainability standards by their own government - unlike foreign competitors fishing the same waters.
All boats fishing in the waters must have an observer, usually someone from one of the island nations who reports what happens on the boat. U.S. operators say the other nations are quick to defend their boats, but American regulatory agencies are quick to issue fines.
Hines said South Pacific Tuna was once fined $336 for a coconut that ended up in one of its nets. He said they were able to get the fine down at the expense of attorney fees.
U.S. operators must also follow labor practices that a typical American company on shore would abide by. In addition to sustainability concerns, labor conditions on boats for foreign crews are often criticized. Greenpeace has issued reports that allege slavery, child labor and human rights abuses on foreign tuna fishing boats.
Anderson, of the University of Washington, said it is debatable how American these U.S.-based boats really are. The company might be headquartered in San Diego, but aside from American boat captains, the crews are entirely from island nations. Also, most canneries are located far from the mainland United States in the territory of American Samoa.
"This is a really, really international market," he said. "We're not talking about a huge number of American jobs."
Anderson said wealthier consumers focused on labor standards might be sensitive to a reduction in the U.S. fleet, but there isn't much evidence the worldwide canned tuna market cares much about sustainability and labor issues.
U.S. boats fish in a massive area of the Pacific Ocean among a cluster of island nations, such as Fiji, Marshall Islands, Papua New Guinea, Tongo, Solomon Islands and Vanuatu. They operate under a more than 30-year-old South Pacific Tuna Treaty with 16 other nations.
In 2016, the treaty was nearly scrapped when one U.S. operator said it couldn't paid the agreed upon fees. The treaty operators then decided to not issue fishing licenses to American boats.
Rep. Duncan Hunter, R-Alpine, stepped in and introduced legislation that would cut $21 million in aid to 15 of the countries in the treaty. The boats were given licenses and a new agreement was approved in June 2016.
President Donald Trump issued a statement in August 2018 asking the Senate to ratify the treaty - the first trade deal his office recommended for approval.
"The Treaty and its Amendments serve United States diplomatic and economic interests by promoting positive relations with the Pacific Island parties and allowing for the continued operation of the United States-flagged fishing fleet in the region," the statement read.
Since 2016, the U.S. boats have operated under a memorandum of understanding that allows them to fish the waters. Despite the president's recommendation to ratify the treaty, the Senate has yet to do so.
After the South Pacific Tuna sale, American boats will make up about 10% of all fishing vessels in the treaty area, said Brian Hallman, executive director of the San Diego-based American Tunaboat Association. China, Taiwan, South Korea and Japan will have around the same number of ships as the U.S., with the rest belonging to Pacific Island nations.
The Senate Foreign Relations Committee will be the first to decide on the South Pacific Tuna Treaty, but is not scheduled to be heard.
Meanwhile, a lawsuit from the American Tunaboat Association is working its way through the courts. The organization argues tuna operators were not told of an upcoming opinion by regulators that may limit tuna fishing. It names as defendants Commerce Secretary Wilbur Ross, NOAA and the National Marine Fisheries Service.
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