Silver Bay sets course for Bristol Bay
A relatively new Alaska processor has set out to expand its horizons by entering the Bristol Bay salmon processing market in the coming years.
Sitka-based Silver Bay Seafoods, which has plants in Valdez, Sitka and Craig, hopes to be processing Bristol Bay salmon and Togiak herring by the 2014 summer season.
News of the state-of-the-art facility first surfaced in November, when Alaska writer Wesley Loy of the blog Deckboss received confirmation that the plant was a go.
The Times-Fisherman has been unable to reach Silver Bay representatives for comment as of yet.
According to Loy, eight acres of industrial-zoned property near Leader Creek Seafood's facility on the Naknek River is the intended home for the new, high-volume plant. The new facility is slated for a 2.4 million pound daily salmon processing and freezing capacity, and about 900 tons of herring daily.
The number of Bristol Bay processors has declined in past years, evidenced by closed-down canneries and consolidation of existing processors.
Last year, for instance, Icicle Seafoods purchased fellow bay processor Snopac Seafoods. While singular, large processors often provide stability for fishermen, reduced competition can lock in prices and offer less productivity than a thriving and competitive processor market.
Bristol Bay Economic Development Corporation, a community development quota organization, would be one of Silver Bay's primary competitors. CEO Robin Samuelson looks at this move as a positive one for the bay's market and fishermen.
"Well we welcome them into Bristol bay," Samuelson said. "We are part owners of one of the canneries, Ocean Beauty Seafoods, but we feel that there's room for them."
"We think that fishermen will benefit," Sameulson said, adding that the increased competition is not a concern to BBEDC, but represents a welcomed increased interest in area fisheries.
Silver Bay plans to finance the $25 million real estate purchase and construction costs by selling shares in a new company - Silver Bay Seafoods-Naknek, LLC.
The Silver Bay parent company is laying down $15 million to purchase a minimum 60 percent ownership of the new company. The remaining shares will be sold at $25,000 for one tenth of one percent.
Silver Bay is an integrated processor, producing frozen, gutted and headed salmon for domestic markets as well as export. The southeast company has been expanding its products and markets at a steady rate since its founding in 2006.
The Sitka plant began processing sac roe herring in 2008; then added bairdi crab, halibut and black cod in 2009; with a roe on kelp addition in 2010.
"Silver Bay's primary strength is in its combination of having a state of the art processing plant and favorable logistics to support its operations," reads the company's website, "competent management and key personnel; an established fish buying system; and ownership by fishermen who represent over 70 percent of the committed fishing effort."
The company is aiming to bite off a considerable chunk of the Bristol Bay market, with plans for a fishing fleet that can take in about 18 percent of the annual driftnet harvest of Bristol Bay salmon. For herring the goal is to harvest right around 30 percent of the Togiak sac-roe fishery.
Hannah Heimbuch can be reached at firstname.lastname@example.org.