LVNDE: ECONOMIC FEASIBILITY OF OKOUNDKISH HARVEST 



Sensitivity to Changes in Fuel Price 



The effect of changes in the price of fuel upon the 

 relationship between the break-even price and 

 catch rate will now be examined. For a given set of 

 vessel characteristics and operating conditions, 

 the fixed and variable costs are constant over a 

 range of catch rates (assuming hold size is not 

 limiting) and Equation (1) can be reduced to: 



Ci C2D 



P = — + 



U U 



(2) 



where Ci and C2 are constants (C2 = volume of 

 fuel consumed), D = fuel price, P = break-even 

 ex-vessel price, and U = total catch. Thus, the 

 effect of the price of fuel upon the break-even ex- 

 vessel price depends upon the catch rate and, of 

 course, the vessel type and mode of operation. 

 Once again using 10 t/d as a point of reference, 

 Equation (2) predicts that for each $0,026/1 

 ($0.10/gal) increase in the price of fuel, a $6/t in- 

 crease in the break-even ex-vessel price results 

 (vessel type 1, delivering at sea, distance = 75 

 nmi). The same increase in fuel price for vessel 



type 1 unloading in port results in an $8/t change 

 in the break-even ex-vessel price. An equivalent 

 increase in fuel price for vessel type 2 results in 

 $5/t and $7/t increases in the break-even ex-vessel 

 price for the sea delivery and land delivery modes, 

 respectively. Thus, any estimates of economic feas- 

 ibility will be moderately sensitive to changes in 

 fuel price. 



Comparison of Fishing Strategies 



In the above comparisons, the distance from 

 fishing grounds to the nearest port was fixed at 75 

 nmi, which is the expected distance if targeting on 

 Pacific cod and walleye pollock in the western Gulf 

 of Alaska. For the two alternative strategies, 

 targeting on walleye pollock in the Aleutians area 

 and targeting on yellow^n sole in the eastern Be- 

 ring Sea, the expected distances are 65 and 220 

 nmi, respectively (Table 4). Accordingly, the model 

 was run and Equation (1) was solved for a range of 

 catch rates using these latter distances. 



Figure 4 shows the ex-vessel prices required by 

 vessel 1 under both modes of operation when the 

 distance is 65 nmi and when the distance is 220 



16 



14 



0) 



O 

 O 



10 



UJ 



o 

 I 8 



UJ 



(/) 



UJ 



> 



4 - 



Figure 4. — Break-even price versus 

 catch rate for vessel type 1, sea delivery 

 and shore delivery, for distances of 65 

 and 220 nmi to the nearest port. 



5 10 15 20 25 30 35 40 

 CATCH RATE t per day on grounds 



45 50 



309 



