by
R.A. Crouter
Director-General
Department of Fisheries and Oceans
Atlantic Fisheries Service
Scotia-Fundy Region
Canada
THE TRADITIONAL FISHERIES FOR HERRING IN THE BAY OF FUNDY
The Bay of Fundy - South West Nova Scotia (NAFO 4X DIV) Herring Fishery is a highly complex mix of inshore (fixed) and mobile gear fisheries. The fishery began in 1870 as a weir operation providing fish for a newly developed sardine-canning industry. At the peak of this fishery, the number of weir sites exceeded 1,000 as compared with the 300 in existence today. In the mid-1930s, the first purse-seine vessels were introduced for the harvest of both juvenile and adult herring. This fleet of relatively small vessels reached a total of 50 during the war years but had dropped off to approximately 35 by the mid-1960s. Up to this point, the gill-net fishery was small and targeted on herring for bait and for minor quantities of food.
During the mid-1960s, a fishing revolution of sorts was to make its presence felt in the herring fishery of this area. A collapse of herring stocks had occurred on the west coast of Canada and, with a large potential in the Bay of Fundy for expansion of harvesting for fish-meal production, many purseseining vessels were purchased and brought to the east coast. From this beginning, a large uncontrolled reduction industry developed, totally eclipsing the use of herring for all other purposes (based on catches by other gear types). Paralleling this development was the rise in activity of foreign fishing fleet, most notably vessels from the USSR, German Democratic Republic and Poland in the Georges Bank area. Without controls on any gear segment, over 500,000 tonnes of herring were landed from the Bay of Fundy and adjacent Gulf of Maine areas in 1968. This level of activity soon led to a collapse of the stocks on Georges Bank and a severe depression of the once stable Bay of Fundy stocks.
THE HERRING STOCKS
The herring stock which supports this fishery is actually a complex made up of two major migrating groups. One large stock group migrates between eastern Nova Scotia and the Bay of Fundy and is exploited in both areas, during the spring and summer periods respectively. This group represents the major fall-spawning component in the Bay of Fundy. In the fall period, after spawning, this stock migrates north eastward along the Nova Scotia coastline to over winter. The second stock component represents mainly juveniles migrating up from the coast of Maine, USA, to summer along the New Brunswick shoreline. While in the Bay of Fundy area, considerable intermixing occurs making any type of quota management by discrete stock difficult. At the present time, the biomass in the Bay of Fundy approximates 700,000–900,000 tonnes of fish, of which 500,000–600,000 tonnes are 4X stock. During the period prior to the event of foreign and domestic purse-seining effort, a third stock of fall spawners on Georges Bank also made a major contribution to the population abundance of the Bay of Fundy area; it is now apparent, however, that over-fishing has at least temporarily eliminated this stock as a contributor to the Bay of Fundy herring population.
THE PRINCIPAL HERRING FISHERIES
Weirs are fixed (stationary) gear representing a capital outlay of $30,000–50,000 per weir. The operating season extends from June to October, employing groups of two to three persons who may tend several weirs. Catches are variable, depending upon climatic and environmental factors, and, for this reason, weir ownership tends to be shared among several persons. Catches are composed mainly of juveniles and the bulk of the catch goes to supply the sardine-canning industry in Canada and in theUSA. In recent years, landings from weirs have approximated 30,000 tonnes, one-half of the total being canned in Canada for sardine and adult-herring products.
Gillnets may be of either fixed or drift types. The fixed gillnets are not a major factor in the fisheries, being operated mainly for bait supply on an as-needed basis. The drift-net fishery in contrast is a highly organized fishery of approximately 350 vessels. Effort is concentrated on spawning stock(s) and the catch performance, at eight to ten tonnes per vessel/day, is quite high, given the capacity of the vessels. This catch is utilized for food-herring products (pickled) and bait. Drift gillnetting for herring employs three persons per vessel and is only one of several fisheries in which these 45-ft vessels participate. While capital investment per vessel may extend from $50,000 to $100,000, only about $10,000 would be specific to herring. In recent years, the Bay of Fundy gillnet catch has averaged 5,000 tonnes annually.
Purse seines are operated from large seiners (over 65 ft in length) and from small seiners (under 65 ft). The large vessels, with replacements costs of up to $4,000,000, operate during an eight-month season within and outside the Bay of Fundy. Until 1979 these vessels fished in the Gulf of St. Lawrence, off the south coast of Newfoundland and around eastern Nova Scotia; but since that time they have been restricted to eastern Nova Scotia. They are licensed for the harvest of pelagic species only. The smaller seiners, with replacement costs of up to $600,000, are confined to the Bay of Fundy during a six-month period but 45 percent of them have licences for other fisheries (groundfish, squid, scallop). The total number of purse-seining craft in Atlantic Canada is now restricted to 66, 50 of which operate in the Bay of Fundy. These vessels crew six to eight persons, operate at night with resulting catches of 30 to 300 tonnes and land these catches within 12 hours of capture.
THE INTRODUCTION AND EVOLUTION OF QUOTAS IN THE BAY OF FUNDY HERRING FISHERY
While varying success has accompanied the introduction of several types of quotas for different purposes in this fishery, the Department remains committed to the use of a TAC calculated by scientific staff and more particularly to the so-called F0.1 concept to re-enforce the conservational purpose of the TAC. The concept is defined as the level of fishing mortality at which an increase in yield from an additional unit of fishing effort is 10 percent of the increase resulting from addition of the same unit of effort on a lightly-exploited stock. Inherent in this approach is a margin-of-safety advantage as well as the disadvantages of failing to maximuze size of fish caught and to stabilize annual catch levels. A concerted effort is made by fishery managers to establish quota levels within the recommended TACs.
As has been described earlier, the herring fishery has been pursued in the Bay of Fundy area for over 100 years. It was not until the rapid expansion in fleet in the mid-1960s, however, that the need for quota control became apparent. The expansion of the purse-seine fleet to serve the emergent fish-meal industry destroyed the balance between effort and resource maintained during the previous century. For reduction purposes, highly specialized, efficient catching vessels directed an increasing level of effort on all herring stocks of this area, increasing harvest levels 5–10 fold. Without controls, declines in catches occurred swiftly and by 1971 landings by purse seines had dropped to 67,000 tonnes from 230,000 in 1968. It had become obvious that continued effort on such a scale would lead to disaster.
In 1972, ICNAF established quotas for the international herring fishery on Georges Bank (150,000 tonnes) and the Canadian Government introduced quotas, based on early biological calculations, for the Bay of Fundy area (60,000 tonnes). This was our first attempt at conservation through quota control and was put in place to restrict the catch of the mobile purse seine fleet. Because of relatively low capture rates, gillnetters and weirs on the Nova Scotia side of the Bay of Fundy were not included under this form of control until 1980. The weirs in New Brunswick exploit the US/N.B. stocks and have remained without control by quota. Between 1971 and 1975 the domestic catch of the purse seine vessels increased from 67,000 tonnes to 100,000 tonnes but values had fallen by 50 percent from previous years. Yielding only about $50,000 annually per vessel, or 50 percent of earning requirements. A crisis had developed. The next major change, consisting of the introduction of socio-economic considerations in quota management, was then introduced.
In response to a request from producers for financial support, the Department undertook a complete review of the east coast herring fishery. The recommendations emanating from this review included (a) reorganization of the industry, emphasizing improved bargaining power for fishermen, (b) concentration on food production to improve prices, (c) subsidization to avoid fleet reduction before or during the 1976 season and (d) restructuring of the processing and purse-seining components of the industry for food production, with fishermen controlling raw-material harvesting and port marketing. Following these guidelines, a representative group of fishermen in the Bay of Fundy was formed and deficiency payments were made to the purse seiners (in September 1975), based on $12 per tonne landed in 1975 to a maximum of 1,500 tonnes per vessel.
The fishermen quickly realized that the solution to their economic problems rested with their ability to bargain effectively as a group, both to influence prices and to provide support for the much advertised objective of a rational industrial structure. Throughout 1976 the following actions were taken, initially involving the purse seine fleet only, as it was in the best position to respond to the government's initiative:
Contracts were made with fishermen's representatives to assist in the development of a strategy and organization.
The use of herring for meal production was prohibited, although specific “meal” quotas were later permitted to compensate for a lack of food-processing capacity.
Compensation was paid to meal-processing companies for losses on capital investment in plants.
A purse seiners' cooperative “Club” with authority to control harvesting and marketing, was formed, involving the introduction of a quasi-property right in the herring harvest for this entity. The control of catch and marketing lead to:
Direct sales to (Polish) factory ships at prices previously unavailable to purse seine fishermen, with access for club members only.
A delay in commencement of the fishery until agreement on price was reached with the processors.
Sharing of catches to avoid dumping of fish at sea.
Vessel quotas, including daily and weekly catch limits to match processing capacities were voluntarily imposed. This step represented a sub-allocation of property rights on a per-vessel basis.
The company-owned fleet was transformed, through financial assistance from government, into one largely owned by fishermen.
Assistance for vessel conversion, to permit landing of first quality herring, was also provided.
Based on a perceived commitment by fishermen, this programme achieved initially a measure of success. In 1976, landed values increased to $4.0 million over the $2.8 million recorded in 1975, despite a decrease in landings from 84,000 tonnes to 60,000 tonnes. Benefits spread throughout the fishing sector and Co-op members received $80 per tonne as compared with $51 per ton for a small number of non-member purse seiners. The cost to government was less than $2.0 million, with no “seed” monies being directed to the club, which accummulated capital through landing charges on members.
The success of the operation resulted in all Atlantic vessels joining the Co-op in 1977 but the spirit of mutual cooperation began to erode when 26 vessels left the organization in 1978 to form two separate associations. At the time of the break-away, it appeared the reasons were based on market availability (or lack of same) in the Fundy area, the desire for less direction in marketing and harvesting and for less internal monitoring. Support for the cooperative approach ceased when the economic influence of direct sales was removed.
The collapse of the fisherman-managed system and rejection of its apparent advantages after only two years induced imposition of more direct control by government. That control included continuation of the vessel-quota system. By 1980 both volumes of herring and prices for catches had declined substantially below the 1978–1979 peak period when prices exceeded $250 per ton. Prices had fallen to less than $100 and many vessels began forming ties to the processing sector in order to secure a market outlet. Mutual cooperation among skippers had collapsed and Departmental attempts to enforce vessel quotas proved to be largely unsuccessful.
The effect of drastically-reduced price levels brought home to vessel owners the realization that, with foreseeable stock projections, the fleet could not be viable. The domestic market, now demanding improved quality levels, left much of the fleet with a limited outlet for landings and the need for ever-increasing price support levels became paramount. The loss of negotiating power on the part of purse seine fishermen, coupled with problems in controlling individual vessel quotas, created a “nightmare condition” in the fishery. It was recognized at this time that the long-term solution to this situation involved fleet reduction. As an interim approach, a decision was made once again to take advantage of the apparent benefits that might be derived from a single, unified purse-seining organization.
DIRECT SALES
The Department approved extensive direct (over-the-side) sales to foreign buyers in 1981 and 1982, provided that the fishermen's groups combine under an umbrella organization once again to control such sales as well as sales in the domestic port market to exert control over individual fishing enterprises. This organization has performed well in terms of benefits to individual fishermen and the control of vessel quotas has been greatly improved. Indications at present suggest very strongly, however, that the glue holding this new association together is nothing more than the increased earnings made available by direct sales to foreign interests.
PROBLEMS IN THE APPLICATION OF QUOTAS
Our experience with the application of quotas by area, by gear type or by size of vessel (fleet class) within an area shows sufficient acceptance by the fishermen to be easily controllable. The situation is not the same, however, when we try to implement vessel quotas. The literature on the merits of transforming a common property resource into a private or quasi-private property resource through quotas fails to list some of the attendant problems. I hope that an outline of some of the problems we have encountered will be helpful to any manager facing the application of such quotas. Our experience convinces us that the application of vessel quotas is not easy but the approach employed was more the soft, persuasive one and less the confrontation route and this exacerbated the situation.
EQUITY CONSIDERATIONS
The application of quotas in the Bay of Fundy Herring Fishery affected the purse seiners mainly. The weirs in New Brunswick exploiting a different stock have not been subjected to any quota. The weirs in Nova Scotia along with the drift nets have been given an allowance, or quota in later years, at a level that did not reduce their historical catch and they were thus relatively unaffected, except that expansion was curtailed by effort control. It should be noted that we did not study the relative economic merits of the prevailing allocation among competing gears or of alterations thereto.
Equity considerations, therefore, apply principally to the purse-seiner fleet, comprising large and small vessels. The initial application of a seiner-fleet quota in 1972 restricted seiner output because this fleet was seen as the principal contributor to the decrease in resource availability. Such considerations became of major importance only with application of individual seiner quotas directed to:
The survival of the seiner fleet in the face of several reduced resources and a drastic fall in the price of herring.
The promotion of fishermen's associations for more effective participation in fishing management.
The protection of the less competitive small seiners in the Bay of Fundy.
It must be stressed that reduced resource availability forced us to impose vessel quotas at a level that made their introduction more difficult. We were stuck at that time with a fleet of vessels that, in terms of number, size and type, was not well suited to the fishery that was developing. The vessel quotas did not address the longer-term problem of appropriate fleet size.
The method of allocating these quotas had to have some acceptance by the seiners and, since the majority of them operated smaller, less competitive units, some level of protection had to be afforded to these latter. The several allocation systems recognized this non-competitive situation and tried to compensate by providing a relatively favourable allocation to the smaller vessels. This was accomplished by uniform vessel shares in the Bay of Fundy, set at a level that provided superior returns to the smaller in comparison with the larger vessels.
The measure represented special support for certain fleet elements at the expense of “high Liners”, which experienced drastic reductions from their historic catch levels. This effect may be considered as an equalization of earnings in a fishery upon which approximately 50 percent of the fleet were totally dependent. The remainder of the fleet accepted the approach because the Bay of Fundy fishery was only one of the seasonal fisheries prosecuted and the subsequent dollar returns from a food fishery compensated for the loss in tonnage. For the local fleet, both catch levels and markets became secure, affording this fleet component the potentially improved earnings.
Differences in size of the Fundy seiners influence the mobility of their operations. Generally vessels less than 65 ft in length are confined operationally to the Bay itself while the larger craft have operated in eastern Nova Scotia, in Newfoundland and in the Gulf of St. Lawrence, depending upon the availability of the resource. In the first decade of seiner operations the average catch per vessel within the Bay of Fundy was only one half of that outside the Bay. In the past six or seven years, resource availability has shifted so that the amount available per seiner within the Bay of Fundy now exceeds by 25 percent the amount available outside the Bay. The change in relative resource availability has brought about a change in the method of allocating access.
Differences in dependence of the seiner fleet upon the herring resources of the Bay of Fundy is also reflected in the number of other fisheries to which the seiners have access. Seiners over 65 ft in length generally are denied entry to groundfishing and scalloping but may enter fisheries for other pelagic species such as tuna, capelin and mackerel. In 1981, 77 percent of this fleet had no licence other than herring. The seiners under 65 ft by comparison have access to a greater number of fisheries and have been somewhat less dependent upon herring as a source of revenue. In 1981, 37 percent of this group had no licences other than herring.
In recent years a closer relationship has developed between some seiners and the companies to which they sell their herring landings. Some companies have invested in and, consequently, influence or control the operations of several seiners. The extent of this control or ownership affects the interplay of forces that establish prices between the companies and vessel operators. Individual vessel quotas bestow or restore some bargaining power to the seining enterprises, both individually and collectively.
What have vessel quotas accomplished during the years 1976–1982?
They made the impact of fleet rationalization less severe but retarded the development of an efficient fleet so that we are left with a fleet segment consisting of small, inefficient vessels and another segment of over-capitalized fishing craft.
They favoured the survival of fishermen's associations and provided an opportunity for greater involvement by fishermen in day-to-day management decisions but they could not preserve the initial unity among the fishermen.
They promoted individual ownership of vessels among fishermen but they did not retard ownership and control by fish buyers (herring processors).
ADMINISTRATIVE CONSIDERATIONS
In order to permit fishermen to participate to a greater extent in the management of their own fishery, an advisory process has been set up. This includes:
An advisory committee comprising representatives of all gear types that exploit the Bay of Fundy/Eastern Nova Scotia herring stocks (including entrepreneurs and crew members) and of the processors who depend upon these landings.
An advisory committee consisting of representatives of associations of purse-seiner owner/operators who operate within Atlantic Canada. In addition, associations of processors and associations of purse-seiner crew members meet with departmental representatives to promote their individual interests.
In order to obtain useful input from these various groups, we have found that a major educational process has been necessary. The implications of area quotas, vessel quotas, association quotas, the findings of biological and economic analyses, and the understanding and acceptance of the need for conservation have to be explained repetitively. We have found that the encouragement of fishermen to share in and even to exercise some control over the management of their fishery is and will continue to be a long and ardous undertaking. For example, over 20 meetings with the purse-seine committee alone were needed in 1982.
We have recently experienced a deterioration in the quality of the information provided by fishermen about their operation - volume of landings, area of capture, etc., which in turn reduces the ability of the Department to monitor quotas. This deterioration in information quality has forced the Department to make greater use of estimating procedures and of duplicate information systems to ensure reasonable effectiveness in enforcement operations.
ENFORCEMENT CONSIDERATIONS
The only major enforcement problems we have faced in the Bay of Fundy fishery have been related to individual vessel quotas in the purse-seine fleet. Fleet, gear or area quotas have generally been enforceable. Our experience with vessel quotas has been each and every fisherman will attempt to “cheat” on his quota and processors will promote that attempt through collusion in falsifying records. Integrity can be incorporated in the system only by co-management of government and producers' association or by the imposition of extremely harsh penalties. This problem in the Bay of Fundy and eastern Nova Scotia areas is exacerbated because of the large number of off-loading docks and by the absence of legislation requiring the weighing of fish at time of purchase.
FUTURE CONSIDERATIONS
I would now like to present some future options.
Setting the level of TAC
This Department has adopted a general policy of following an F0.1 approach in determining TACs. This does not appear to be the ideal approach for herring fisheries because it does not permit maximization of size of fish nor does it permit stabilization of the annual harvest. Our scientific staff are now addressing those problems.
Vessel Quotas
Vessel quotas have not been a useful tool overall in the management of the Bay of Fundy purseseine fishery. We are currently developing a substitute approach which would see the introduction of separate large and small-boat fleet quotas with a free fishery within those quotas. This would protect the small-boat fleet but it would at the same time re-introduce competitive fishing.
Property Rights
We will continue to encourage government deregulation through implementation of property or quasi-property rights. This could come about as a second step to the large-boat/small-boat quota approach or from consolidation of all purse-seine vessels into a single category. Ideally the fishery would be best managed by industry as a whole through a property-right process, with the Department setting TACs and providing some level of enforcement.
