20/04/2020 - 15:26

Casting a line in the COVID crisis

20/04/2020 - 15:26

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SPECIAL REPORT: The state’s premium fishing operations are scrambling to adapt in an industry that no longer has a clear path to market.

Casting a line in the COVID crisis
David Carter says he felt an obligation to the broader community to keep Austral’s boats operating throughout the novel coronavirus crisis. Photo: Austral Fisheries

The state’s premium fishing operations are scrambling to adapt in an industry that no longer has a clear path to market.

As many premium food businesses across the country shut up shop due to COVID-19, Austral Fisheries made the contrary decision to send its banana prawn and toothfish fleets out to sea.

Austral chief executive David Carter said not only were the risks of exposing his crews to the novel coronavirus outbreak weighing on his mind, there was also considerable doubt as to whether the company would be able to sell its catch when the fleet returned.

“We don’t know if there will be a market,” Mr Carter told Business News.

“We went through a process of saying ‘How do we weigh the risk here?’

“There is a new measure of risk associated with putting people on boats in a fishery, and we had to ask if we needed to be doing it.

“I took the view at the time that I think we have kind of a higher calling.

“We feel a sense of gratitude to our crews, and businesses that find themselves in this position owe it to the broader economy and the broader community to do what they can.”

(click here to view a PDF of this special report)

The biggest challenge in sending out the boats, Mr Carter said, was managing a quarantine period for the 180 crew members sent out to operate the 15-boat fleet.

Austral’s toothfish fleet operates out of Mauritius, with the fishing crews isolated for 14 days prior to getting onto the boat to ensure none of them were infected.

The banana prawn boats are based in Cairns with a similar strategy – isolate crews for the COVID-19 incubation period prior to allowing them to step onto the boats.

Mr Carter said the decision to send out 180 crew members and 15 boats, the company’s full banana prawn and toothfish fishing fleet, was made not only with the interests of Austral employees in mind, but also to benefit the broader community.

“I tell folks that it was like living in a remake of Indiana Jones, with Harrison Ford racing out of some tomb with his booty and the world’s collapsing behind him, one trip, one fall, one step short of being engulfed by a raging fire, or a surging flood or a rolling boulder,” he said.

“That’s how it felt; a week’s difference in timing and we would have had a very different outcome.

“The better outcome is that these guys get to go to sea, get to make an income, support their families and get to have some kind of normalcy, and Australia gets to have access to some super high-quality marine protein.

“That speaks to the broader self-sufficiency of the country that Australian farmers have been pretty effective in reinforcing over the last couple of weeks.”

For the Geraldton Fishermen’s Co-operative, the rapid spread of COVID-19 throughout China’s Hubei Province immediately answered the question of whether there would be a market for the western rock lobster catch, Australia’s biggest and most valuable fishery.

Unfortunately for the industry’s fishers, however, the answer was no, with orders from China grinding to a halt in the last week of January.

Co-operative chief executive Matt Rutter said the situation escalated quickly around Chinese New Year, which landed on the Australia Day weekend in 2020.

“We’d seen news reports out since December around this mystery virus in Wuhan and then we started to see the press around it increase during the week leading up to Chinese New Year,” Mr Rutter told Business News.

“Towards the Wednesday of that week there was increased nervousness from our buyers and on the Thursday we started to get a smattering of cancellations.

“We had to make the decision that night that we were going to have to stop deliveries from our fishers, because the buyers were cancelling orders and we were starting to hear rumours of China basically going into lockdown.”

Mr Rutter said at that stage there was still no clear indication that the COVID-19 outbreak was about to become a global issue.

“We were thinking how unlucky we were that our main market had gone into lockdown,” he said.

“Then three weeks later we started to see some spurts of demand come back, some opportunistic buying from some of our buyers who were buying and storing and had some small interest, and demand for home deliveries and those sorts of things.

“But as that was picking up into February, the rest of the world was falling into a hole.

“Airlines around the world were being grounded and borders were being shut, and pretty quickly it shifted from a market issue to being a logistics issue.”

Mr Rutter said more than 90 per cent of the western rock lobster catch was exported live to China each year, mostly in the cargo hold of passenger flights.

Without those flights, options of getting live lobsters to market were few and far between.

Mr Rutter said the co-op had been exporting opportunistically since February, getting lobsters on the last passenger flights available and also getting freight onto medical supplies flights as they returned to China.

Domestically, Mr Rutter said the co-op had been facilitating home deliveries for household consumption, with the country’s restaurant sector shut down and unable to take up the volumes of lobsters available.

A federal government initiative to boost the industry was unveiled last week, facilitating the export of 500 tonnes of lobsters to China, or around 7.5 per cent of a typical annual catch.

Mr Rutter said the arrangement, with the government underwriting the cost of freight, gave certainty to fishers for at least two months, but fell short of returning the industry to business as usual.

“We have to basically take a financial position in a plane before we have got certainty of making sales, so it is a very complex problem so having this government support and just taking the edge off the cost and financial risk for us is a huge help,” Mr Rutter said.

“It certainly hasn’t alleviated all of the issues and we are still paying a premium for our freight, probably twice what we normally would pay, but it’s better than what it was.

“Probably about 30 per cent of the fleet is out at the moment, but we are seeing that gradually increase now.

“Even though the prices are not necessarily massive, the fishers are increasingly needing to go out for cash flow and those sorts of things.”

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