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Company to boost Kotzebue summer chum operation

May 19th | Shady Grove Oliver, The Arctic Sounder Print this article   Email this article  

Following a slim couple of years, the summer Arctic keta, or chum, fishery in Kotzebue should see a significant boost this summer.

Seattle-based E&E Foods, which runs both land-based and vessel operations in Bristol Bay, Southeast, and the Kenai Peninsula, plans to bring its floating processor to the waters outside of town this summer.

"I feel really good about this opportunity where they're going to be able to have a volume fishery now, and not have the limitations that they've had with a pure buy-and-fly-type fishery," said Roger Stiles, business manager for the company's Southcentral operations.

Buy-and-fly refers to the type of fishery Kotzebue has predominantly had for its chums in years past. Buyers typically went after fresh product that had to be flown out of the community regularly on an air carrier, meaning the amount they could take was constrained by the carrying capacity and regularity of the plane.

"It's always been that the limiting factor on the fishermen out there is what kind of air capacity there is. Unfortunately, the air schedule does not come anywhere close to what the fishing capacity is," Stiles said. "The Kotzebue fish is a tremendous product but the transportation costs up there for getting in and out are extremely expensive so it limits the processors on what we can pay for the fish."

That, in turn, has had a trickle-down effect on local fishermen, who have struggled to make ends meet with constraints not only on what they can bring in, but what they can send out.

"It's tough for fishermen to make it when they're getting paid 33 or 35 cents a pound for their fish when they're limited to only being able to catch 1,500 or 2,000 pounds," said Stiles. "With the price of gas and everything else, it takes away a lot of that profit right away. It's tough to fish and make a go of it with those prices."

E&E Foods is already planning to send its floating processor, the Cape Greig, to Bristol Bay for the area's lucrative summer season. It will be accompanied by the freighter Sea Bird and combined, the two vessels have a carrying capacity of 1.2 million pounds of frozen finished product, Stiles said.

After that seasons winds down at the end of July, the two boats will head up to Kotzebue and set up shop for the keta harvest, starting Aug. 1.

"It wouldn't be cost-effective to do it if we were just going up there just for the chums, but since the floater's already up in Bristol Bay and the timing is such that after the finish of Bristol Bay, they'll be able to go up to Kotzebue for the peak [of that season], that makes it a cost-effective operation," said Stiles. "We couldn't do Kotzebue strictly on its own without Bristol Bay."

The processor will be located about 10 miles outside of town, at the mouth of the channel. While the Sound is deep enough to accommodate the bigger boat, the mouth of the channel is only a few feet deep in certain places, making it hard to enter.

For that reason, a tender will accompany the freighter and processor to shuttle the fish back and forth from the local fishermen to the Cape Greig.

The tender, called the Liahona, is more well-suited to handle the conditions at the mouth of the channel and just outside, where there can be large swells and high winds, than many of the smaller skiff-type boats some fishermen use, said Stiles.

Fishermen will hand over their product to the Liahona, which will transport it to the Cape Greig and the Sea Bird. Combined, the larger vessels have a crew of 87 and a processing capacity of 200,000 pounds of fish per day, Stiles said.

"It seems like everyone's excited about this," said Kotzebue Mayor Gayle Ralston. "The past couple of seasons have had very few success stories — let me put it that way. The fishing periods have been short and sweet, so to speak. A lot of that has been getting the fish out to market from Kotzebue. They were only flying them out. In a nutshell, it sounds like there's a great possibility of having more fishing periods this season and extended fishing periods because of the ability of E&E Foods to process and buy fish offshore."

Along with the offshore operation, E&E Foods will continue to buy fresh product on the beach at the end of 4th Street, Stiles said. They'll purchase it under the Pacific Star Seafoods name through site managers Cisco and Billie Rabang and Donnie Johanson.

The beach operation will open first — with the first official opening of the season — and remain in service through the end of the season on Aug. 31. The offshore operation will pick up partway through and will deal in frozen product.

As in years past, the fresh operation on the beach will be constrained by air capacity. Because of the addition of the offshore processor, Stiles said E&E Foods has been working with the Alaska Department of Fish and Game to discuss longer openings and higher limits, as the greater capacity will be manageable this season.

"It looks like we [may be] able to have up to 14-hour openings a day, six days a week," he said. "So, rather than fishermen only being allowed to fish four hours or having limitations on only being able to catch 2,000 pounds of fish, now they'll be able to fish continually for 14 hours, six days a week and make multiple deliveries."

That may also make the fishery viable for fishermen who have to work day jobs and weren't able to accommodate previous daytime-only openings.

An additional benefit to having the floating processor offshore, rather than just the fresh operation on the beach, is the money the boat will bring into the local economy through the statewide fish tax, he explained.

Brick and mortar processors are taxed at a rate of 3 percent, with half of that going directly to the community in which the fish is processed.

"Because there's been no processing taking place in Kotzebue, that fish tax revenue has gone to Anchorage or Kenai, where the fish is actually processed," said Stiles. "So, all these years the fish tax has bypassed the community of Kotzebue."

Floating processors are taxed at an even higher rate of 5 percent, with 2.5 percent going to the nearby community. For Kotzebue, that could mean an influx of $15,000-$20,000 this summer from the tax alone, Stiles estimated.

"The city, just like every community out in rural Alaska, is really challenged to be able to sustain ourselves to provide services, especially with pending legislation at the state level that could cut revenue sharing, for instance," said Ralston. "This is a great shot in the arm, I believe."

Stiles said this year's operations will be a test for future viability of bringing the offshore processor to town, but he thinks with support from the local fishermen, it should turn into a profitable endeavor.

If it is a success, he said he'd like to see it continue down the line.

"Anything that works for Kotzebue and the region, I'm fully supportive of. The general take I get is the local fishermen support this, as well," Ralston said. "It just looks like a great opportunity to benefit the community, the region, the fishermen, and the local businesses. It diversifies the local economy, and hopefully this year will be a great year compared to the past and give us hope for the coming years."

Shady Grove Oliver can be reached at


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