Oregon Dungeness Crab Fishery Bioeconomic Model: A Fishery Interactive Simulator Learning Tool

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1 Oregon Dungeness Crab Fishery Bioeconomic Model: A Fishery Interactive Simulator Learning Tool Version 5.8 prepared by Coastal Oregon Marine Experiment Station Oregon State University and The Research Group, LLC Corvallis, Oregon prepared for Oregon Dungeness Crab Commission September

2 Acknowledgements Sponsor: Oregon Dungeness Crab Commission (ODCC) Study team members: Gil Sylvia, Marine Resource Economist and Director OSU Coastal Oregon Marine Experiment Station Shannon Davis, Principal, The Research Group, LLC Corvallis, Oregon Noelle Yochum, Ph.D. and Chris Cusack, Ph.D. while they were students at OSU Study steering committee: John Corbin, Chair (Commissioner, harvester) Crystal Adams (Commissioner, processor) Dave Wright (Commissioner, processor) Mike Retherford (Commissioner, harvester) Rick Lilienthal (Commissioner, harvester) Brian Nolte (Commissioner, harvester) Nick Edwards (Commissioner, harvester) Jake Postlewait (Commissioner, public) Hugh Link (Commission staff) Al Pazar (harvester and processor) Cody Chase (harvester and direct sales) Jen Wimpress (FISHCRED staff) Bob Eder (harvester) Caren Braby and Kelly Corbett (agency) Other participants: Harvesters and processors interviewees in the cost-earnings survey Justin Yeager (harvester) and the many other attendees at steering committee meetings Hugh Link (Executive Director, ODCC) Kelly Corbett (Biologist, ODFW) 2

3 Oregon Dungeness Crab Commercial Fishery Crab gear. Images courtesy of Noëlle Yochum. 3

4 Whale Gear Entanglement Avoidance Management Action for Early Season Closure Average season overall fleet profitability does not change much with early season closure. There are fleet distributional effects. The model is not spatial sensitive, i.e. zonal closure impacts cannot be calculated. The model is not temporal interval sensitive, i.e. in-season stand downs cannot be calculated. The model could be used in an early closure cost-benefit analysis if whale entanglement avoidance incident rates and per whale harm economic value is known. 4

5 Project Goals Address the ODCC research priority of creating a bioeconomic model for the commercial Dungeness crab fishery. Provide information on how the timing and extent of the fishing season impacts the health and profitability of the fishery. Explain the differential impact on economic output and the size and structure of the crab population from bycatch, discard mortality, cannibalism, and other fishing and biologically related variables. 5

Model Components MODEL INPUTS Biological data Economic data

Profits Catch Mortality Stock level Distributional Impacts

management strategies o Changes in stock dynamics o Changes

6 Model Components MODEL INPUTS Biological data Economic data Fleet behavior data Management strategies MODEL OUTPUTS Profits Catch Mortality Stock level Distributional Impacts INPUTS OUTPUTS ANALYSIS Compare outputs: o Different management strategies o Changes in stock dynamics o Changes in fleet behavior o Changes in price Tradeoff Analysis Sensitivity analysis 6

7 Biological and Economic Model Inputs a) Biological Handling mortality Cohort mortality week shift due to biological conditions such as time of moulting Natural mortality weekly factor Crab growth rate per year Current and following season recruitment variability (change in beginning biomass) Catchability (change in CPUE per biomass) b) Harvester trip costs for each vessel classification Bait cost per pot-pull o Start of season through February o March to end of season Fuel cost per trip (average) Other cost per trip (average) Crew cost shares of revenue c) Season pattern Weekly price shift from base period in the current and following season. d) Processor yields and product form proportions Whole cooked fresh Sections frozen Meat canned and frozen Live 7

8 Usefulness of a Bioeconomic Model Provide information to stakeholders to improve operations and safety, increase economic benefits, and conserve the resource.. Find data limitations and improve data collection and fisheries assessments. Stimulate collection of relevant biological, economic, environmental, and social information. Help improve analytical approaches. Provide a convenient tool for the industry, management agencies, research institutes, NGO's, and other stakeholders to assess potential for investments and programs. 8

9 Bioeconomic Model Design Model relies on 7-year data series (seasons through ) for catch and effort. The season average across the data series is termed the base period. Data intra-season dates are reduced to a weekly resolution. Model independent variable values are provided as defaults. Values can be modified by the user to test model relationships and impose new management actions. User inputs define the model assumptions and management actions to be tested. The model generates the net impacts (i.e. difference) between the defined alternative (with-action) and the status quo (without-action). Gross impacts are calculated to be the difference added to the base period annual average. Multitude of model outputs: o Mature male stock size, natural and fishing mortality; o Economic impact indicators; o Tradeoff displays (example is conservation vs. profitability); and, o Text file containing management alternative s inputs and analysis results. 9

10 Fishery Management State management governance is authorized by federal legislation (expired in September 2016). There is a memorandum of agreement between the states. Each state participates in a PSMFC collaboration and season start program. The PFMC has considered management preeminence in the past. Each state has limited entry and permit pot number limitations. The Oregon fishery is limited entry which started with the season. Oregon's pot tiers are 200, 300, and 500 and started with season. Conservation input controls use a 3-S strategy (size, sex, and season). Oregon conservation output controls are weekly trip limits starting second Monday in June and harvests following May 31 cannot exceed 10 percent of harvests prior to that date. As a result of receiving MSC certification (which was allowed to expire in 2015), a generational harvest control rule was established. Four years of declining catch and catch/cpue thresholds will trigger additional adaptive management measures. 10

11 Northern Pacific Ocean U.S. and Canada Harvest Value in 2014 Selected Fisheries All Fisheries Salmon Dungeness Crab Trawl Shrimp Region Amount Share Amount Share Amount Share Amount Share Alaska 1, % % % 0.7 1% British Columbia % % % 1.5 3% Washington onshore % % % % Oregon onshore % % % % California onshore % % % 4.3 8% West Coast at-sea % Total 2, % % % % 11

12 West Coast Historical Landings for 1950 to 2016 Volume (millions of round pounds) Washington volume Oregon volume California volume Real price using GDP IPD index Nominal price $4.50 $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 Price (real price 2015 Dollars) $0.00 Notes: 1. Landings approximate seasons (November through October) for forward and are calendar year up to Landings are not filtered for research, illegal fishing activities, full retention fisheries, weigh backs, confiscated overages, or personal use. Season is estimated to be complete based on a historical landing share for the most recent complete month landing data is available. 2. Landings in Washington include commercial fisheries tribal and non-tribal in coastal Pacific Ocean, Strait of Juan de Fuca, and Puget Sound. 12

13 Oregon Dungeness Crab Fishery Fishing Intensity Map Effort Per Block in Season 13

14 Scattergram of Pot String Pulls by Date and Hailed Pounds for Oregon D. Crab in Season 14

15 Vessel Exit/Entry by Month in December 2013 to November Vessels Exiting Entering Total

16 Processor Annual Yields, Costs, and Product Forms in 2014 Round Landed Ex- Processor Costs/Sales Finished Wholesale Value Pounds Distri- Vessel Price Per Finished Pound Pounds Value Added Product Form (thousands) bution Price Yield Raw Other Sales Price (thousands) (thousands) (thousands) Whole cooked fresh 3,407 30% % ,135 17,546 3,824 Sections frozen 1,704 15% % ,264 1,403 Meat canned and frozen 2,271 20% % ,084 2,936 Live 3,975 35% % ,776 21,033 4,229 Total 11, % % ,467 58,927 12,392 16

17 Selected Fishery Information During the Base Period Image courtesy of Scott Groth, Pink Shrimp/ South Coast Shellfish Project Leader, Marine Resources Program, Oregon Department Fish and Wildlife, December

18 Recent Seasons Earliest Season Opening Reason Season Volume (millions Nominal Negotiated Start Nominal Annual Season Date Description for Delay of pounds Price Price /1/2009 Dec. 1 coastwide /1/2010 Dec. 1 coastwide /15/2011 Dec. 15 north of Gold Beach / Jan. 15 south of Gold Beach /31/2012 Dec. 31 north of OR/CA border / Jan. 15 south of OR/CA border /16/2013 Dec. 1 south of OR/CA border / Dec. 16 north of OR/CA border yield yield yield /1/2014 Dec. 1 coastwide /4/2016 Jan. 4 coastwide DA /18/2016 Dec. 18 south of Cape Blanco / Jan. 1 north of Cape Blanco (strike delay settlement reached on Jan. 6 that began a Jan hour pre-soak period) DA Notes: The pick-out rate (meat yield) standard is 23 percent north of Cascade Head and 25 percent south of Cascade Head. DA is threshold presence of domoic acid. 18

19 Oregon Onshore Landed Harvest Value for Base Period Other groundfish 10% Albacore tuna 10% Sablefish 10% Pacific whiting 9% Pacific sardine 4% Other 3% Troll Chinook 3.5% Pink shrimp 15% Total $136.8 million Dungeness crab 32% Salmon 7% Troll coho 0.0% Net Chinook 2.5% Net coho 0.6% Other species/gear 0.0% Notes: Fishery harvest value in each year adjusted to 2015 dollars before averaging. 19

20 Landings by Port for Base Period Base period average landings per season for Dungeness crab: 16.7 million pounds $43.9 million harvest value The Oregon ports with the greatest engagement (between ports) based on harvest value in 2014 were: Newport 34.1 percent Coos Bay 24.3 percent Astoria 22.6 percent Of the ports landing $1 million harvest value or more in 2014, the highest dependency (within port) on Dungeness crab were: Winchester Bay 78.0 percent Garibaldi 56.4 percent Port Orford 43.2 percent 20

21 Annual Effort and Harvest Across Base Period Pot Pulls Pot Pulls (millions) Harvest Pot pulls Harvest (millions of pounds) Season 21

22 Harvest Volume and Price by Week Across Base Period pounds 8 Average Average Price (2014 Price Dollars) price Volume (millions of pounds) Week Notes: 1. Oregon onshore landings from ocean catch areas, excluding research and discard disposition, and bay fishery harvests. 22

23 Pot-Pulls and CPUE by Month for Ocean Dungeness Crab Vessels in Base Period Pot-Pulls (thousands) CPUE Pot-pulls CPUE (pounds per pot-pull) Calendar Month 0 23

24 Cumulative Shares of Catch and Effort by Week for Base Period 100% 90% 50% of catch between Week 2 3, 5 8% of season concluded, 25 33% of effort Cumulative Percent 80% 70% 60% 50% 40% 30% 20% 90% of catch between Week 11 12, 30 32% of season concluded, 72 75% of effort Catch Cumulative Catch Cumulative Effort Cumulative Weeks Catch (millions of pounds) 10% 0.5 0% Week

25 Fishery Participation There were an average 321 vessels out of a permitted 424 vessels that participated during the base period. An average 116 thousand pots out of an authorized 150 thousand pots were fished during the base period. The effort in the base period was 1.4 million pot-pulls and 7.7 thousand trips. Average revenue per effort is $31 and average revenue per vessel is $137 thousand during the base period. 25

26 Participating Vessels Average Annual Revenue and Ratio Dependence on the Dungeness Crab Fishery by Week for the Base Period Average Annual Revenue Per Vessel (thousands) D. crab revenue per vessel Other fisheries revenue per vessel Ratio Ratio of D. Crab to Total Week 26

27 Vessel Participation by Vessel Classifications for Base Period 250 Number of Vessels Participating Early-exiters Summers Partakers Highliners Misc Week Notes: Classification descriptions by hierarchy order are: 1) Summers: Vessels harvest Oregon ocean D. crab on or after June 10 and on or before August 14. 2) Early-exiters: leave fishery on or before January 31. 3) Highliners: D. crab is majority of revenue and total revenue greater than $250,000. 4) Partakers: D. crab is majority of revenue and total revenue less than or equal $250,000. 5) Miscellanies: D. crab less than a majority of revenue. 27

28 Effort, Revenues, and Profitability by Vessel Classifications for Base Period Summers Early-exiters Highliners Partakers Misc. Total Vessels Effort 469,208 92, , , ,665 1,407,155 Dec-Feb 263,740 92, , , ,248 1,041,296 Mar-Aug 205, ,788 69,185 40, ,859 Trips 3, ,891 1,489 7, tier , tier 1, , , tier 1, ,294 Fishery ($000's) Revenue 12,434 4,233 6,845 10,055 10,338 43,905 Profitability 7,440 1,844 2,819 5,998 4,152 22,251 Per effort Revenue Profitability Per vessel Revenue 129, , , , , ,958 Profitability 77,497 48,521 79,237 71,768 61,570 69,412 28

29 Methods Tagging crab. Image courtesy of Noëlle Yochum. 29

30 Discard Rates for Base Period 2,500, Number of Crab 2,000,000 1,500,000 1,000, ,000 Discards (both genders, all sizes, any condition) Discard rate Rate Per Retained Crab Week 30

31 Handling Mortality Rates for Base Period 80, Number of Crab 70,000 60,000 50,000 40,000 30,000 20,000 Handling mortality (mature male adults) Aggregate handling mortality rate Rate Per Retained Crab 10, Week 31

32 Biomass and Mortality 32

33 Management Action Analysis Developing the bioeconomic model for the primary purpose of analyzing early season closure allowed for extra management techniques to be included. Altering effort. Delaying season opening. Closing the season early. The techniques can be applied singular or in combination applications. Caution is suggested in relying on results for the model's capability to analyze management options for altered effort and delayed season start. This is because there would be fisherman and processor adaption not patterned in the datasets used to develop the model. 33

34 Actual and Predicted Effort by Week Pot Pulls 400, , , , , , ,000 50, ,000 Actual and Predicted Effort by Week actual predicted Week R 2 =

35 Model Menu Page 35

36 Model Dashboard Page 36

37 Results Image courtesy of Hallmark Fisheries. 37

38 Carryover Biomass Origin and Disposition for Example Eight-Week Early Closure Management Action Carryover Biomass (Pounds) 450, , , , , , , ,000 50, Current Season Fall No Season Following Season Week Fall no season biomass Following season biomass Cannibalism Hard Legal Soft Legal Hard Sublegal Soft Sublegal Catch 38

39 Profitability Impacts for Early Season Closure 1,000,000 Fleet 500,000 Changed Net Revenue 0-500,000-1,000,000-1,500,000-2,000,000-2,500, week 8 week Default Model default values -3,000, Week of Closure Notes: Envelope is changed net revenue for high and low input values not including price shift. 39

40 Season Economic Impacts for Early Closure Management Actions Eight-Week Sixteen-Week Base Period Base Period Percent Percent Results Difference Results Difference Harvester Pounds 16,664, % 16,477, % Revenue 43,690, % 42,666, % Profitability 22,172, % 21,827, % Processor Wholesale value 68,599, % 67,296, % Communities Income 70,404, % 68,933, % Processor 14,683, % 14,518, % Harvester 55,721, % 54,415, % Total job equivalents 1, % 1, % 40

41 Management Action Tradeoff in Profitability Attained Through Season Early Closure Conservation Reduced Annual Fishing Mortality 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% Week 20 Week 21 (-$0.5 m, 0.5 m pounds) Week 22 Base period annual average: fishing mortality 17.0 million pounds o handling 280 thousand pounds o cannibalism 56 thousand pounds o retained catch 16.7 million pounds net revenue $22.3 million Week 30 (-$79 t, 308 t pounds) 0.5% Week % Week % -3.0% -2.5% -2.0% -1.5% -1.0% -0.5% 0.0% 0.5% Profitability 41

42 Profitability Impacts by Vessel Classifications for Early Season Closure 0 Summers 40,000 Early-Exiters -200,000 30, ,000 20, ,000 10, , ,000 Highliners 100,000 Partakers 30,000 50,000 20, ,000-50, , ,000 Misc. 60,000 40,000 20,

43 Harvester Impact Shares by Vessel Classifications for Early Season Closure Summers Early-exiters Highliners Partakers Misc. Total Eight-Week Early Closure Impacts Revenue Season per vessel -4, , , Season share -3.63% +0.72% +0.72% +0.72% +0.72% -0.49% Profitability Season per vessel -2, Season share -2.59% +0.72% +0.71% +0.72% +0.72% -0.36% Sixteen-Week Early Closure Impacts Revenue Season per vessel -13,616 1, ,845 Season share % +1.33% +0.01% -0.81% +0.65% -2.81% Profitability Season per vessel -5, ,327 Season share -7.48% +1.33% +1.14% -0.04% +1.42% -1.91% 43

44 Summary Early Closure Management Action Eight-Week 1. Overall decrease of: a. $214 thousand harvest value b. $79 thousand in profits c. $301 thousand personal income to the State's economy level. 2. Summer vessel class: decrease in $186 thousand profitability 3. All other vessel classes: increased profitability of $107 thousand. 4. Tradeoff between conservation and profitability: a. 1.8 percent reduction in fishing mortality (includes a 69 percent decrease in handling mortality) vs a 0.4 percent reduction in profitability 5. Natural mortality overwhelms handling mortality: a. reduced handling mortality conserves 231 thousand pounds b. mature male adult natural mortality is 12.7 million pounds Sixteen-Week a. $1.2 million harvest value b. $424 thousand in profits c. $1.8 million personal income to the State's economy level. decrease in $539 thousand profitability increased profitability of $115 thousand. a. 3.0 percent reduction in fishing mortality (includes a 71 percent decrease in handling mortality) vs a 1.9 percent reduction in profitability a. reduced handling mortality conserves 238 thousand pounds b. mature male adult natural mortality is 29.2 million pounds 44

45 Future Research Example model enhancement and other research: Validate and expand discard mortality rate estimates via fishery observer procedures based on representative sampling. Design and plan for fishery independent surveys to determine stock assessments and intra-season crab condition. Supplement existing information about harvest costs and processor yields and costs. Add market outcome model feature that allows price to be endogenously calculated, although any modeling will be challenging given substitution and scarcity issues. Research existence, influences, and consequences of local area in-season depletions. Add fisherman spatial choice economic behavior predictors including knowledge based cooperation variables. Adapt model framework to allow game theory solutions for predicting fishing behavior and market outcomes. Include optimization mode allowing user to systematically evaluate tradeoffs among multiple objectives (e.g., maximize rent, raise social benefits, conserve fish resources). Incorporate management option for interval intra-season timing closures and/or intraseason zonal closures. Hold a Dungeness crab science and management biennial meeting for the West Coast including Alaska and British Columbia. The meeting would be a forum to share research and management findings, ideas, and collaborative opportunities. Other (see Heppell and Thompson 2010 and ODFW 2014) 45

46 Overall Summary Inform Decision Making: The bioeconomic model fulfills the purpose for providing a tool to inform decision making about changes to fishery management policies and practices. Provide a Management-Level Tool: The study methods were not developed to advance bioeconomic model theory, but to provide a management-level tool for generating economic measurements. Value of Economic Analysis: The utility in using the model is raising awareness of economic impacts when formulating changes in management. It provides the connection between biological concerns and economic objectives in the search for better management solutions. Fostering Improved Collaboration: Having economic impact information readily available can foster heightened collaborative relationships among stakeholders for managing the fishery. Limitations on Long Term Analysis: The model is limited for analyzing long-term harvest sustainability levels and optimum management techniques. Additional research and model development is needed for wider applications. 46

47 Questions Image courtesy of NOAA Fisheries. 47

. OREGON COMMERCIAL DUNGENESS CRAB FISHERY

. OREGON COMMERCIAL DUNGENESS CRAB FISHERY 1999-00 FISHING SEASON REVIEW and ISSUES UPDATE Presented to OREGON DUNGENESS CRAB COMMISSION at Newport, Oregon September 1, 2000 By Rod Kaiser John Schaefer