San Diego Seafood Industry Flounders Under Coronavirus, But Fishing Community Finding Ways To Stay Afloat
At San Diego’s Dockside Tuna Harbor Market on a recent Saturday, hundreds of people lined up along the pier. They came to this market to get their hands on some fresh fish, caught and butchered by local fishermen.
The restaurant business has changed dramatically in the last couple of months, and that’s made it hard for the San Diego seafood industry to stay afloat. So, fishermen are turning to the market to make up the lost profit.
But seafood businesses are also hurting. They may get some relief from a government stimulus package, but how quickly they can bounce back could depend on the types of fish they supply.
Selling directly to the consumer for now
Jordyn Kastlunger is a third generation fisherman in San Diego. She spends even more time at this market now.
“I was working at Ironside. It’s a type of fish restaurant … and they closed. March 16th is when I became unemployed at the ripe age of 23,” Kastlunger said.
Kastlunger says fishermen can’t sell to restaurants or processors, because most of them have closed. Seafood also isn’t a popular takeout item.
“It’s a lot more limited, a lot of the processors…if they're still open, it's just really limited to what and how much they're taking ... So the market has been the biggest export of where we can sell our stuff,” she said.
And then there’s also the problem of species. Kastlunger says the fishermen right now are able to move the fish they catch locally, but people still ask for popular options.
“Our biggest thing that people are asking for that we don't have is salmon. We don't have that down here. [But] people have been willing to try different things,” Kastlunger said.
This six-year-old market is busier than ever, as consumers opt for a larger batch of fresh seafood over standing in line at grocery stores for expensive, frozen product.
That’s a relief for fishermen. But, Kastlunger admits, this once-a-week market and willingness to try different species may not last.
“There’s a saying around here ... 'fresh fish isn't cheap and cheap fish isn't fresh,'” she said. “I hope that [the market] continues to stay as interesting to people.”
Processors and distributes hold supply chain together
That interest is key, because those processors and distributors fishermen rely on for the majority of their sales are already feeling the economic pain, said Gavin Gibbons, an executive at the National Fisheries Institute.
“Over the last few weeks, we're seeing companies reporting losses of, you know, tens and hundreds of millions of dollars already ... job losses are mounting,” Gibbons said.
Federal statistics show the seafood industry sees around $140 billion in commercial sales annually. The California Fisheries & Seafood Institute says the state’s retail industry is worth over $20 billion.
And 70% of that profit comes through restaurants.
“One of the issues is that a barrier to consumption oftentimes is preparation. And some people are saying, 'I don't really know how to cook seafood, but I like it. So I want to go to a restaurant and I want to have a chef do it for me,'” Gibbons said.
“So, the reliance on the restaurant or food service side of things is part of the issue.”
Gibbons said most suppliers normally sell expensive species to restaurants. So, they can’t just sell those fish to canned pet food processors, because suppliers won’t cover their costs. Also, they can’t buy in bulk, because they don’t have the customers and they can’t store all of it.
“There is not enough cold storage space to hold ... every piece of pollock and every piece of salmon that comes out of the water in Alaska. They would have to stop fishing. I can’t just pack up my boat and bring it to a processor who's gonna tell me, ‘I can't take your product because it's perishable,’” Gibbons said.
Some relief, but could it be too late? Speedy recovery may depend on species
In late March, Congress passed and the president signed a $2.2 trillion coronavirus stimulus bill, with $300 million destined for fisheries and seafood businesses.
“That is just now being distributed to states so that they can pass it along to the seafood community. And it hasn't even begun to reach seafood companies yet,” Gibbons said. “And again, there's one point 7 million Americans employed in the seafood value chain and job losses are mounting.”
And the time that it’s taken for many companies to see that money has already been too long.
Kathy Strangman is the owner of San Diego’s Seafood Inc. The company normally sources and supplies tens of thousands of pounds of seafood to restaurants a week. In March, her business dropped to just hundreds of pounds in seafood sales.
“Horrendous … It was just so humiliating. We're a small business, like a family, and having to give [my employees] that packet with the unemployment information. It was really hard, because I think they knew it was coming, but not that quickly," Strangman said .
She said after she crunched the numbers she knew she couldn’t stay open. She closed her doors two days before California Gov. Gavin Newsom declared restaurants had to shut down.
She says she applied for a Economic Injury Disaster Loan right away.
“We were running numbers and seeing … we would have been negative by say 15-20,000 a day. We need 15,000 just to break even in sales,” Strangman said.
“When you buy one load of halibut, let’s say you buy 2,000 pounds. That’s $22,000 ... a lot of money to invest if you can't move that product off. Now other industries like pet food, they use sardines, anchovies that aren’t really used on center plate,” she said.
Strangman got notification mid-May that her application went through. The loan is only a portion of what she asked for, but she said it’s enough to get started.
She said she’ll need to work on coronavirus safety guidelines and begin sourcing fresh seafood in bulk again. And find restaurants willing to make large orders.
“We're going to need at least a week to get back in the facility, obviously get everything sanitized again, which we have great procedures for,” she said.
But after being in the business for so long, Strangman said she’s prepared and eager to get started. She recalls one memory when she knew that she’d be in this for the long haul.
“My oldest, he'd come home and he'd say, ‘Mommy, you stink.’ I’d be like, it smells like money. OK, this is our livelihood. This is what's going to raise you.”
In the meantime, she hopes the San Diego fishing family can get through this pandemic together, showcasing their talents and fish like they do at the Dockside Market.