Those of us lucky enough to work with Alaska salmon are truly blessed. We work in the most pristine and beautiful environment in the world, in the world's best-managed and most-sustainable fishery. During the past decade we have seen prices rise as the Alaska brand has become recognized by consumers everywhere as the model of quality, flavor and reliability.
We benefit from a state government that understands the importance of the seafood industry and that is willing to partner with the industry to ensure that Alaska maintains its position in the seafood world. The Alaska Department of Commerce, Community, and Economic Development (DCCED) is sponsoring a seafood industry trade mission Oct. 19-22 to Iceland. Alaska and Iceland are often mentioned together as the as the world leaders in seafood sustainability, and are in the beginning stages of developing strong seafood business relationships as well.
Iceland is also at the forefront of seafood innovation. This trip will bring together senior management of Alaska's processors with a broad representation from Iceland's seafood industry. The purpose is to share ideas and goals, and bring Iceland's innovations to Alaska. This trip would not be possible without the leadership of the State of Alaska Division of Economic Development.
Another example of Alaska working to ensure the health of the seafood industry occurred during this past legislative session, with the passage of SB 71, which included an extension and modification of the Salmon Product Development Tax Credit. Thanks primarily to Gov. Parnell, Sen. Pete Micciche, Rep. Alan Austerman, Department of Revenue Commissioner Rodell, and Commissioner Bell of the DCCED, this bill became law and provides significant changes that will help keep the value of Alaska salmon high to Alaska fishermen and still provide a value to consumers.
Since its establishment in 2004, this tax credit has driven investment in value-added seafood processing. One example is the introduction of filleting equipment into Alaska shoreside plants, allowing processors to fillet salmon in Alaska, rather than exporting minimally processed fish overseas for filleting. This investment added jobs in Alaska, improved fillet quality, and helped create a whole new domestic market for once-frozen sockeye fillets -- while simultaneously eliminating our over-dependence on headed and gutted fish. It did all this for a remarkably small investment, one that was dwarfed by the return to the state.
The bill has been modified before, to match current market conditions, and in 2014 it was modified again. The new version of the bill makes three crucial changes.
This tax credit can now be used to modernize traditional canning lines, which will translate to better packaging and increased value to the consumer and fisherman.
The credit now provides an incentive to utilize parts of the fish that are currently underutilized and turn them into saleable product. The industry currently derives only partial value from the heads, viscera, fins, and other "waste" parts of the fish, but this credit will accelerate product development in this area, increasing product diversification and getting us closer to the goal of full utilization. An added benefit of the bill is protection from impending regulatory changes. By spurring investment in waste reduction through product development, we not only gain more value from the fish, but keep ahead of extremely expensive regulatory changes.
The third change is to allow for investment in canned herring equipment. There is currently no large-scale herring canning, but the herring market is very depressed and badly needs innovation.
The same remote and unspoiled landscape that makes Alaska such a great place to work, and such a great environment for wild salmon, also makes it a difficult and expensive place to operate. But the world economy makes no allowances for our challenges. Innovation is expensive, especially with a seasonal fishery that takes place in remote areas, and these changes require substantial investment. It is up to us to battle for position against salmon farmers and other competitors who may move their operations to low-labor environments and do not have a long-term stake in their local communities.
The seafood industry is the largest private employer in Alaska. It is critical that we keep these jobs here. And we will do that by continuing to grow the value of our product. Jobs, tax revenues and thriving coastal communities are the benefits we reap by investing in Alaska's salmon future.
Mark Palmer is president and CEO of Ocean Beauty Seafoods, based in Seattle.
The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com.