17-02945_Sablefish_SOW.pdf

Sablefish Aquaculture Economics and Marketing Analyses

Statement of Work

Sablefish (also known as black cod) is a high value marine finfish with limited availability.

While sablefish is not considered overfished in the Eastern Pacific (from Alaska through British Columbia south to California) its high commercial value undoubtedly generates pressure for higher annual catch limits. NMFS has invested in the development of technologies to farm sablefish as a means to increase U.S. aquaculture production and to relieve pressure of higher harvest levels on the fishery. In order to determine the viability of commercially aquaculture for sablefish, an economic analysis of the costs of production is needed. Additionally, a market analysis is required to identify national and international markets for wild-caught versus farmed sablefish to insure aquaculture production does not negatively impact the sablefish fishing industry. Because NMFS does not have in-house expertise available at this time to conduct the proposed analyses, the bulk of the work will need to be conducted by a vendor specializing in aquaculture and fisheries economics and marketing analyses (see Specifications below).

This project entails conducting economic analyses of the costs of production, focusing on the two major phases of sablefish aquaculture: 1) hatchery production of juveniles (including broodstock management) and 2) grow-out of juveniles to harvestable size, which may vary among producers. Analyses shall be based on recent advances in hatchery production of juveniles and development of monosex female lines of sablefish by researchers at the Northwest Fisheries Science Center (Seattle, WA). Additionally, the project will entail conducting preliminary market analyses to investigate potential markets for farmed sablefish and to estimate impacts of increased supply of farmed sablefish to commercial-capture fisheries for sablefish in the U.S. and Canada.

The overarching goal of this project is to develop an assessment of the economic viability of a commercial net pen-raised sablefish industry, and secondarily to assess the potential that development of sablefish aquaculture could negatively affect the currently vibrant commercial sablefish fishing industry. Specific tasks and deliverables are as follows:

Task 1: Provide data and a written summary of the existing commercial fisheries for sablefish in the U.S. and British Columbia, Canada. These fisheries produce the vast majority of the global supply of sablefish. In addition to documenting harvests (i.e., global supply), the summary should describe participation, revenues, fishing periods, the management systems, and estimated asset values of quota shares. To the extent that information is available, the vendor should also summarize data on size distribution of harvests, noting that larger sablefish fetch higher prices in the market.

Task 2: Provide data and a written summary related to the international markets for sablefish.

The vendor will need to collect and provide quantitative data and qualitative information:

Quantitative data should focus on the Japanese markets for sablefish, which have historically been by far the largest. Huppert and Best (2004) most recently assessed these markets.

Qualitative information should be generated from review of industry trade publications and market trends shall be captured, providing specific examples and insights.

Task 3: Provide an updated economic analysis (including a written summary and data) of the global market demand for sablefish, originally developed by Huppert and Best (2004). Data for this econometric model should be collected by the vendor in Tasks 1 and 2. The updated econometric analysis should enable projections of price changes that would be expected with increases in global supply as a result of sablefish aquaculture. Industry publications should also be reviewed to summarize trends in the global market, including the potential for an expanding market in Korea, as well as known changing consumption patterns in Japan (e.g., sablefish sushi reportedly gaining in popularity). This assessment would also incorporate information on differential market prices for sablefish of different body sizes.

Task 4: Develop contacts and utilize informants to generate an initial assessment (including a written summary and data) of the potential for a high-end niche market for large, farm-raised sablefish. For this task the vendor would need to conduct a series of 20-30 key informant interviews on the willingness of high-end sushi restaurants to purchase fresh, farm-raised sablefish. This initial assessment would not be considered a full-scale demand analysis, but should provide insight to the potential of specialized niche markets for U.S. sablefish aquaculture producers.

Task 5: Work directly with Northwest Fisheries Science Center (NWFSC) and NMFS West Coast Region (WCR) scientists (Luckenbach, Fairgrieve, Goetz and Hoberecht) to estimate annual production costs of rearing commercial quantities of monosex female sablefish that can then be transferred to grow-out operations. NWFSC researchers shall provide initial data for this analysis. Vendor deliverables will be a written summary and production-cost estimates.

Task 6: Work directly with NWFSC and WCR scientists and data collected recently from their collaborative efforts with Golden Eagle Sablefish in Canada to quantify and compare the “grow-out” production costs of mixed-sex pen-raised sablefish to production costs of monosex female, pen-raised sablefish. NWFSC researchers shall provide initial data for analysis. Vendor deliverables will be a written summary and production-cost estimates.

Task 7: Data and analyses from Tasks 1-6 shall be compiled into a concise and accessible project report that draws conclusions on: 1) the production costs of sablefish farming; 2) the potential for sablefish aquaculture to develop into a significant new source of supply into the global market; 3) the potential that sablefish aquaculture could negatively affect the commercial fishery for sablefish.

Specifications for vendor experience:

• A minimum of 20 years’ experience in fisheries economics is required to ensure adequate knowledge of, and experience with, historic interactions between wild capture fishery and aquaculture products.

• Significant experience assessing impacts of management actions to U.S. sablefish fisheries.

• Significant experience with economics of aquaculture in the Pacific Northwest and Alaska.

Period of Performance:

Date of Award to April 1, 2019

DATA PRIVACY

Should work on this agreement require that personnel have access to Privacy information, personnel shall adhere to the Privacy Act, Title 5 of the U.S. Code, Section 552a and applicable agency rules and regulations.

Data created, obtained and collected during the performance of this agreement is the property of NMFS. Data may not be released by any party without written consent from the NMFS POC. Data must be protected from unauthorized disclosure. Personnel must comply with all Federal, DOC, NOAA, and NMFS policies relating to IT and data security.

NON-PERSONAL SERVICE

Personnel performing services under this order will be controlled, directed and supervised at all times by management personnel of the contractor. Personnel will perform independent of and without the supervision of any Government official. Actions of contractor employees may not be interpreted or implemented in any manner that results in any employee creating or modifying Federal policy, obligating the appropriated funds of the U.S. Government, overseeing the work of Federal employees, providing direct personal services to any Federal employee or otherwise violating the prohibitions set forth in Parts 7.5 and 37.1 of the Federal Acquisition Regulations. The NMFS will perform the inspection and acceptance of the completed work.