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Some guys are spoiled, though. They remember when nobody took 35% off the top of their earnings just so they could go fishing. And they recall when fishermen weren’t angling to capture the upside of the next generation’s labor.
Ben Chestnut is one of those guys. He left trawling in 2011 after decades as a boat captain, after the boats he worked on were sold and traded, and he didn’t have the money to enter the catch share as an owner. “The bottom line is I got put out of the fishery because I didn’t have enough money to buy a permit,” says Chestnut, noting his son fetched $535,000 for a permit at that time.
Now 71, he drives wastewater trips from a surimi processor to the Pacific. He spends some of the rest of his time drinking coffee at the Barge Inn, a woodsy tavern in Newport’s downtown that faces the whale on the mural of the Pacific Seafood plant. The plant has its own share of quota, awarded since the catch share was created. Since then, the company has purchased roughly a dozen boats and their quota, amassing a small fleet.
“I look for big business to own all the fish eventually,” Chestnut says, observing that as the values of fish rise, quota values rise with it, making it easiest for businesses like processors, not individual fishermen, to acquire what quota comes on the market. “Nowadays with the permits, and the value of the permits and the value of the fish quota, you’d pay millions of dollars to buy them out.”
The notion isn’t just sour grapes. Catch shares have shrunk the number of fishermen working nationwide, and big business can and does swoop in for the largest assets. In the lucrative crab industry in Alaska, for example, 184 boats left the industry during and after its conversion to a catch share, even while the value of the crab climbed from $125 million in 2005 to today’s $202 million. It’s mostly quota owners who captured that upside, not crews that do the fishing. Before the catch share, fishing crews earned 35.7% of their revenue catching crab. Five years later, they earned 20.4%, primarily because of soaring rents.
Such rising values have combined with consolidating assets to open the door for big business and equity investors to move in. In the nation’s oldest catch share, for example — Atlantic quahog, denizen of the canned clam — 49% of boats have disappeared since the catch share took hold in 1990. Thirty years later, a quarter of the quota sold to British private-equity firm Lion Capital in a deal for Bumble Bee Foods. Bumble Bee acquired it with the prior purchase of its subsidiary Snow’s, the clam chowder king.
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