THIRTY-FIRST BIENNIAL REPORT 109 



tion plants, with the belief that the canning of sardines is the highest 

 use to which they can be put and that the excessive use of these fish 

 in reduction plants would, in time, result in depletion of the source of 

 supply. The majority of the canners, on the other hand, have sought 

 to get the quick returns from sardine reduction and have made them- 

 selves believe there was no danger of depletion. 



The following is a good statement of the situation in the California 

 sardine industry, by Harry R. Beard, chief technologist of the United 

 States Bureau of Fisheries, in Bureau of Fisheries Document No. 1020 : 



Canning practically has been secondary in importance to the manufacture 

 of fish oil and fish meal from wliole fish and cannery offal. The state law 

 never has required the oanners to pack all the fish they have taken. The 

 liberal excess that has been allowed has been taken advantage of for the 

 manufacture of these products. Inasmuch as there is more profit in the 

 manufacture of fish meal and oil than in sardine canning, every effort has 

 been made to expand this branch of the industry. To do this it has been 

 necessary, in order to comply with the state law, to can more fish. To get rid 

 of this canned fish, the price has been lowered — low enought, in fact, to 

 stimulate a large foreign demand, especially in the Orient, for pound-oval 

 sardines. In some places this product has supplanted the cheaper grades of 

 canned salmon ; in fact, in 1925, for the first time, exports of canned sardines 

 exceeded canned salmon exports. 



Whatever advantages or disadvantages the policy discussed above may have 

 in the long run, it has brought about large scale production and a wide distri- 

 bution of California pound-oval sardines. Adjustments are bound to come in 

 the future, which will have their effect on the industry. 



In time, pound-oval sardines must sell at a price that is based on their own 

 cost of production. Production of fish oil and fish meal can not continue to 

 dominate canning. 



Mr. Beard's prophecy has not yet been fulfilled but there is every 

 indication that it is about to be fulfilled. ]\Iost of the canners now 

 believe our sardine supply is being overtaxed and that the amount 

 used in reduction plants should be reduced to the unavoidable minimum 

 in connection with canning operations. Nearly all of the canners are 

 in favor of limiting the pack by longer closed seasons or by any other 

 practical means, and, at the same time, of improving the quality of the 

 pack. In other words, they are for making the canning of sardines the 

 profitable end of their business rather than rely on sardine reduction 

 for their profits. It is easy to see how greater profits may be made 

 from canning rather than reduction, provided a fair price may be 

 obtained for the canned product. They now propose to get this fair 

 price by improving the quality and at the same time avoiding over- 

 production. 



LEGISLATION 



In our last report we told of the uncertainty and ambiguity of the 

 sardine conservation act of 1925, especially that part of the act which 

 permitted canners to use an amount of sardines in reduction plants 

 up to 25 per cent of the cannery's capacity, and of how we failed to 

 reach an agreement with the industry and the bill designed to make 

 the law more definite was withdrawn. 



The 1927-28 season passed without any serious differences between 

 the industry and the Fish and Game Commission, although, economi- 

 cally, the situation was becoming rather desperate for the canners, dae 

 to overproduction of canned goods. 



