Canned Salmon Inventory and Sales
Alaska Department of Revenue released the Alaska Salmon Production Report in March. This provides data to make the January canned salmon inventory estimates, replacing the post-season canned salmon production estimates with actual production figures.
For ease of discussion, all can sizes are converted to a single measure: 48-tall case equivalent. The 48-tall case equivalent captures production and sales volume of all four standard can sizes for canned pink and canned sockeye.
Discussion of canned salmon sales and price follows the “sales season” which begins in September of the harvest year and ends in August of the following year. This is consistent with the production season for canned salmon and with reporting periods for the Alaska Salmon Price Report. The 2009 sales season began September 1, 2009 and will end August 31, 2010.
January 2010 Canned Sockeye Inventory
Canned sockeye inventory is estimated at 678,000 48-tall case equivalent, similar to January 2009 inventory but down 19 percent from the five-year average of 841,000 cases.
September - December sales volume of canned sockeye has been relatively consistent for several years. Decreased inventory is attributed to the declining production trend for canned sockeye. Despite a series of consistently strong harvests, canned sockeye production has declined substantially since 2004, when production was 1.43 million cases on a 44 million harvest. Production in 2009 was down 34 percent to 949,000 cases on a similar-size harvest of 43 million sockeye.
January 2010 Canned Pink Inventory
Canned pink salmon inventory is estimated at 1.8 million 48-tall case equivalent. This is similar to January 2009 inventory, but substantially below the five-year average January inventory of 2.2 million cases.
The light January 2010 inventory of just 1.8 million cases has significance beyond the simple function of providing adequate supply before 2010-harvest production enters the marketplace. Pink salmon has a distinct two-year abundance cycle that normally is reflected in year-to-year fluctuation of canned inventory. Canned pink inventories following the strong odd-numbered harvest years (2005, 2007, etc) are substantially higher than inventories following the modest, even-numbered years. (2006, 2008, etc). However, that pattern appears to be changing and canned pink supply is expected to tighten further in the coming year.
Pink salmon product-form composition has stabilized at about 55 percent canned. While this has reduced supply, declining pink harvest has also reduced supply, to a more significant degree. The largest pink harvest on record was 161 million in 2005, yielding canned production of 3.5 million cases. Production declined to 2.7 million cases on 144 million pinks in 2007, then dropped to 1.7 million cases on 96 million pinks in 2009.
The concurrent odd-year harvest and production declines of 2005 - 2009 have essentially eliminated the cyclical inventory peaks and potential carryover that might otherwise augment supply from weak, even-numbered harvest years. With a very light harvest projection of just 69 million pinks in 2010, it appears that supplies of canned pink salmon will be quite limited in the coming sales season.
While this is good news for sellers with respect to maintaining the current 20-year high wholesale prices, the supply problem may ultimately result in market volatility when the Alaska harvest rebounds or an alternate supply of canned pink salmon enters the marketplace.