108 OTHFR INDUSTRIAL DKVn.OPMHN I ("OIK IIS 



Ihc IX'piirtmcnt lakes satistaction tnnii the (act that 

 Japanese hii\eis pay more for the lio/en salmon it allows 

 to be exported than they pay lor the a)rres(X)nding U.S. 

 product."' I tear this may he the result ol preventing for- 

 eigners Irorr buying anylhmg but the best quality prod- 

 ucts. But expv>rting only the best prinJuct should not 

 become a policy objective. Ilie purpt>se shtmid be to 

 assure buyers of the quality of the pro<.lucts they bargain 

 tor, but not to prevent them from buying the full range of 

 products produced. 



Moreover, the argument that such restrictions provide 

 more employment is apparently exaggerated; studies 

 have shown that the labour content in frozen salnum 

 exports is very close to that of canned salmon. Further- 

 more, restrictions on fresh and frozen exports reduce the 

 value added in processing in Canada: and the benefits to 

 producers of canned fish are outweighed by the losses 

 they impose on fishermen and other producers." 



I therefore urge the Inspection Division to use quality 

 controls to promote market opptirtunities for fish prod- 

 ucts, and to avoid using them to manipulate patterns of 

 processing and trade. 



9. The Department should continue to develop its pro- 

 gram of quality certification for exported fish products 

 to ensure that pn)duct standards are met; it should 

 refrain from using quality controls as a means of 

 restricting export trade. 



Thus, the fishing industry should be free to respond flexi- 

 bly to changing market opportunities for fish products. 



A related matter is the Department's practice of 

 restricting fishing licences in certain fisheries in an 

 attempt to generate higher prices by controlling the sup- 

 ply of the product available to foreign markets. 



. . .there have been examples of the Depart- 

 ment of Fisheries and Oceans developing 

 internally, market misinformation for use in 

 fisheries management. For example, in the 

 mid-1970's the Department determined that 

 the Japanese herring roe market would be 

 damaged if Canada produced in excess of 

 45,000 tons of roe herring. After industry 

 protestations, the limits were raised to purely 

 biologically safe catches of in excess of 80,000 

 tons. During that period, herring roe was sold 

 at its highest prices experienced to that date." 



This objective also lies behind the limitation on herring 

 spawn-on-kelp licences, described in Chapter 10. 

 .Although the resources can support a greatly expanded 

 industry, the Department has refused to issue more 

 licences for fear of depressing prices in the Japanese 

 market. 



The rX'partmcnt's commercial licensing policy ought 

 not to be concernetl with manipulating market power. As 

 I have emphasized in preceding chapters, it should be 

 directed toward priividmg access to the available 

 resources in a way that will encourage the fishing indas- 

 try to respond efficiently to market opportunities. (This 

 implies avoiding development of more fishing capacity 

 than needed to harvest the available catch, but this is a 

 separate matter from restricting the available catch 

 itself.) 



I therefore recommend — 



10. The DepartuK'nl should not be influenced by coasidcr- 

 ations relating to market prices in deciding the appro- 

 priate number of commercial fishing licences to be 

 issued. 



Such considerations distort licensing policy and are 

 beyond the responsibility of the Department. 



Vessel Inspection 



Apart from distributing information about fish hand- 

 ling methods, the Department's vessel-inspection pro- 

 gram is confined to ensuring that vessels handling fish 

 are constructed to meet certain specified standards for 

 fish holds and other facilities that enable them to main- 

 tain the quality of catches. But even the best-equipped 

 vessel can prejudice fish quality unless it is maintained 

 in a clean condition. Thus, participants in the Com- 

 mission's hearings have noted that the failure to enforce 

 standards of housekeeping on fishing vessels is a major 

 weakness of the vessel-inspection program. This deficiency 

 should be met by gradually extending the program 

 to include inspections of operational maintenance to 

 meet standards of health and quality on vessels. Thus 

 I recommend — 



11. The Department should extend its vessel-inspection 

 program to include inspections of operational cleanli- 

 ness and standards of vessel housekeeping. 



However, having made this recommendation I should 

 note that regulations applied to vessels are only indirect 

 means of improving fish quality. Ideally, attention should 

 be focused on the quality of fish landed. Vessel stan- 

 dards should be used only as an expedient means of forc- 

 ing the industry to equip itself adequately to handle fish. 

 In the long run, more sophisticated quality grading of 

 landings should replace dep^endence on regulating the 

 characteristics of vessels. 



CONCLUSION 



This chapter has dealt with a variety of arrangements 

 that are tangential to the Department's central role in 

 managing fish resources and fishing activity. Some of 



