Business

Fiji Fish, Solander close part of operations and lay off staff

By RANOBA BAOA Two major local fishing companies say have been forced to shut down most of their operations. It is no longer economically viable to continue fishing, they said.
16 Jan 2014 09:06
Processing certified albacore at one of the local fishing companies in Fiji.

Processing certified albacore at one of the local fishing companies in Fiji.

By RANOBA BAOA

Two major local fishing companies say have been forced to shut down most of their operations. It is no longer economically viable to continue fishing, they said.
In doing so, Fiji Fish Marketing Group and Solander (Pacific) Limited have been forced to lay off staff at a significant number.
Enquiries by the Fiji Sun, have discovered that the Fiji domestic tuna industry, also dubbed as Fiji’s $300 million industry is close to its total collapse, with most of the major tuna companies being forced to cease operation.
Sun Business understands that the two companies’ cut back are only just part of the bigger tuna collapse occurring across the Pacific region.
This situation is most current in American Samoa’s recent tuna industry outcry where they have tied up 20 vessels and put them up for sale.
Further enquiries have revealed that around 75 per cent of the Fiji domestic tuna fleet have ceased operations.
They anchor in Suva Harbour while the remaining vessels are likely to cease operations shortly.

Redundancy
Many of these vessels have been tied up for more than a year, we were told, and the companies have revealed massive losses over the last four to five years.
In response to a series of questions directed towards the Fiji Fish managing director, Grahame Southwick, he said he has been forced to cease all tuna operations and lay off staff.
“Fiji Fish will continue operations servicing the remaining foreign vessels, and fish trading and processing fish off the foreign boats, but it is closing down the loss making section of its business which is the Domestic Tuna Fleet.”
Fiji Fish is one of the first and largest tuna fleets to operate in the South Pacific, and owns a tuna processing factory based in Lami.
However it’s now been forced to lay off hundreds of staff since mid-November including captains, engineers, fishermen and factory staff.
Mr Southwick is also president of the Fiji Tuna Boat Owners Association.
He confirmed that he has even advised out of the 35 boats owned by association members, only five were still fishing. However may also have to withdraw operations in the not-too-distant-future.
Mr Southwick said that for about five years, the Tuna Boat Owners had persevered by taking heavy losses in an attempt to hold the industry together .
They had tried to preserve the skills and jobs and foreign exchange, and retain the hard fought markets that Fiji had development.

Drastic measures
However they believe their fight has come to no avail thus resulting in the drastic measures.
“The tuna industry is well past the point of no return now. The industry has been struck an unfair and fatal blow by the hundreds of state-subsidised foreign vessels which have surrounded Fiji,” Mr Southwick said.
“In addition to these external factors, Fiji itself has contributed substantially to the demise of its own fleet, by issuing excessive domestic licenses against all advice, encouraging fly by night so called ‘charter boat’ operators who are in fact 100 per cent foreign owned and controlled and have successfully infiltrated the domestic fishery.”
Many of these boats have operated in breach of license conditions for years with impunity, he said.
In 2012 it was found that Fiji issued 70 vessels licences which were 20 more than the optimum limit.
Fiji Fish now intends to close 5 of its seven fish outlets, along with the fleet shutdown.
“This shutdown, is going to cause just another ‘side effect’ and that is the loss to the Fiji public of some 5000 tons of cheap by catch that is sold on the local market,” he said.
“Along with all the obvious losses to the economy, this shutdown will seriously affect Fiji’s food security plan, its bargaining position at International Tuna  meetings, and PAFCO to some extent.
“We haven’t fully decided which shops we will close, but Nausori will be one, and some of the more distant outlets that have been more of a service to the public than profit contributors.”

Similar challenges
Solander general manager Radhika Kumar confirmed similar challenges to the company and said last year fishing dropped to a new low level.
She said Government had done its best to reduce licences to 50 from 65.
“We can confirm that as a consequence of the Fiji fleet reduction we have lost two operating licences from our fleet. We are also not operating our fleet at full capacity,” Ms Kumar said.
“The loss of two licences is, in effect, a 20 per cent reduction in business activity and it is necessary to lay off staff and crews accordingly.
“Some of this will be by natural attrition but there will be the inevitable redundancies and further redundancies are likely following reduced fishing activity as explained below.”
Sun Business understands that there are just over 400 employees at Solander and about 80 people so far have been made redundant to date.
“Solander, as with other domestic operators flying the Fijian Flag, receives no direct Government subsidies – neither does it expect to,” she said.
“Almost all foreign fleets operating in the Pacific however receive subsidies of one form or the other.  The position of the subsidised fleets differs from us.
“Margins are very tight in the fishing industry and we are being forced into a totally uncompetitive position because of the expanding numbers of subsidised vessels in the Pacific.”

Level playing field
Had they been given what they say is a level playing field, their position would have been otherwise.
“Currently fishing activity of the group has been reduced to 50 per cent and we have only six of our vessels fishing.  The position is under further review.
“The main fish caught by the Fiji domestic fleet is albacore and once Fiji had a proud local fleet that is now in disarray.
“The Fijian Government has shown responsibility in limiting and even reducing licence numbers but is alone amongst Pacific Island nations to do so.”
All Tuna (including Albacore) is highly migratory meaning that it is not restricted only within its boundary but eventually migrate.
“What happens on the High Seas and the EEZ’s (Exclusive Economic Zone) of other countries has an impact on catches within Fiji waters.
“The failure to control activity outside of Fiji is the main cause for the present decline in catches. There are too many boats catching too little fish.  Even now more subsidised foreign vessels are appearing in the Pacific.”
Sun Business has sent questions to another fishing company believed to be at the brink of foreclosure. However management was still awaiting responses from top executives when this article went to press.
We have also made contact with Minister for Fisheries Lieutenant-Colonel Inia Seruiratu. He said he would comment if Sun Business gets all three companies’ responses.
Questions have been sent to him accompanied by responses by the two quoted companies.

PAFCO effects
The two companies said these likely measures will impact heavily on Pacific Fishing Company Limited, a major cannery in Fiji and the Pacific.
Questions and enquiries were sent to them yesterday but they had yet to make their statement when this article went to press.



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