Whale Meat Doesn't Sell: The ICR Reports Miserable Result of Auction

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Created on Tuesday, 22 May 2012 15:07

900 tons, an astonishing 3/4 of JARPN II meat, is left unsold from the auction. Nisshin-Maru returns from Antarctica (whose “mission was cut short by SS”) bringing back over 1000 tons. Now with the whale meat silently mounting in their warehouses, the future of the ICR is uncertain…

 On October 27^th 2011, the Institute of Cetacean Research (ICR) announced that it would send 1211.9 tons of whale meat to auction. This is the byproduct of its summer research program in the Northwest Pacific Ocean, and the amount equals much of the meat for commercial distribution previously sold on a negotiation basis. The only exception to the bidding is 3-tons of sperm whale meat, and 235.9 tons secured for public distribution that will be provided to rural communities and schools at low prices.

 The auction took place every month from November 2011 and ended as planned in March 2012. There were five auctions for sei whale, and four for minke and Bryde’s whale meat; separately for those who are in the industry (the intermediate wholesalers) and the general public. The auctions sold a mere 303.1 tons. Three-quarters of the available meat, 908.8 tons, is left unsold.

Negotiations and Biddings

Conventionally, the way the research byproduct is sold is as follows; The ICR entrusts the sales to Kyodo Senpaku, the wholesale price is set for each part of the meat according to the research expense so that the program cost is covered, and the meat is sold to regular wholesalers on a negotiation basis. In another words, the ICR was able to set their price.

However, with the auction process now in place, the situation has changed; the bidders indicate the amount they are willing to pay when the bidding opens and the product is sold to the highest bidder rather than the desired selling price set by the ICR/Kyodo Senpaku. The bidding is also open to the general public, in addition to the regular wholesale customers.

The prices set by the ICR/Kyodo Senpaku were not disclosed, but the price list from JARPN II in 2010 was made available as a reference prior to the bidding. Everyone knew that these prices were too high for any buyers and the bidding would close with prices lower than what had been indicated as a reference.

Bidding Results Released

The publically released information on the biddings included: the number of bidders, the number of successful bids and their total volume, and the maximum, minimum and the average final selling price for each meat section. The minimum final price can be regarded as the amount very close to lowest selling price set by the ICR/Kyodo Senpaku. After careful examination of the bidding results, not only the fact that 3/4 of the available meat were left unsold, but also other interesting facts started to surface. The following are some of them.
 

Unable to Clear Inventory, Unable to Sell High

Minke whale “premium red meat” and “first grade accordion” were the only cases where the average selling price was higher than the referenced amount, and they were both sold out. These products together weigh only 300kg taking up mere 0.025% of the total bidding volume, but the bids must have been a good news to the seller.

Other parts were sold at prices lower than the referenced price, showing the ICR/Kyodo Senpaku’s effort to sell off what they had. For example, the tail meat (“onomi”) from Bryde’s whale was referenced at 20,000yen, but the bid was made at its half price, 10,000yen. This was the largest gap between the reference and the actual, but even then, the final bidding showed “no successful bids,” meaning nobody bought the meat in the final round.

 

Bryde’s Meat Didn’t Sell

As seen in the case of the tail meat, the least popular product was the Bryde’s whale meat. The meat sections from this species showed the highest number of “no successful bids” and “no bids.” “No successful bids” means there were bidders but the bidding failed as the price could not be agreed on, but “no bids” means there were no bidders to start with.

The red meat was sold at 51.6% of the referenced price. For sei whale, it was 64.5%, and minke was 74.2%. From this, one can easily surmise that the ICR/Kyodo Senpaku was desperate enough to lower the price to sell off the meat.

Too Much Sei Whale Meat

Regardless of the price comparison, when looking at the volume left unsold it can be seen that sei whale takes up 58% of the total. More sei whale meat was sold than Bryde’s whale, and it is not unpopular;, it’s simply that there is an oversupply.

Large Influx of Whale Meat 1: Antarctica

They must sell off these leftovers by any means, as Nissin-Maru came back from its research expedition in Antarctica freshly dumping 266 minke whales and a fin whale at Oi Suisan Pier in Tokyo Bay on March 31st. Extrapolating from the amount of byproduct produced from a single whale in the past, the volume of whale meat involved is likely over 1000 tons.

According to the media report, the research program “could not attain the planned catch quota due to disruptions from Sea Shepard and bad weather conditions.” If the catch quota was indeed attained, however, that would only mean more whale meat being added to already full, refrigerated warehouses across Japan. The ICR can pay for the cold storage all they want, but increasing the national energy consumption level this way may give one more reason to resuming nuclear power plant operations and it can’t be ignored so easily.

Large Influx of Whale Meat 2: Iceland

Since 2010, very cheap whale meat imported from Iceland has been threatening the sales of research whale meat. After leaving the IWC in 1992, Iceland rejoined the commission in 2002 with a reservation on the moratorium on commercial whaling, and started whaling commercially in 2008. In addition to minke whales, Iceland started hunting fin whales the following year, and by 2010 it started to export to Japan, ending the ICR/Kyodo Senpaku’s monopoly on whale meat market.

The volume of Icelandic whale meat that was imported to Japan was about 500 tons and over 900 tons in 2010 and 2011 respectively. These numbers amount to approximately 25% of the total baleen whale meat provided by the research program. 20% of the total whale meat supplies in the last two years were from Iceland.

When anti-whaling countries showed strong opposition to Iceland rejoining the IWC, Japan and its supporting countries and whaling nations such as Norway strongly backed the decision. In order for two countries to trade whale meat, they must both have a reservation on the international trade agreement of CITES and be a member of the IWC. In retrospect, by supporting Iceland Japan paved the road to creating obstacle to its whale meat sales.

Large Influx of Whale Meat 3: Ayukawa, Miyagi Pref. and Kushiro, Hokkaido

Another notable whale meat source comes from the research whaling carried out by local coastal fishermen. Until 2009, the ICR managed the research program by hiring small-type whalers and entrusted the whaling operation. Now the ICR only carries out the academic research, entrusted by an incorporated body called the Association for Community-Based Whaling the ICR itself organized, which operates the whaling program.

Whaling takes place in the 50 mile radius from the base. The caught whale is dismantled into meat pieces at a slaughterhouse in Ayukawa on the same day, where measuring and sampling also take place. The fresh meat is then swiftly put up to auction.

The Great East Japan Earthquake and Tsunami destroyed Ayukawahama of Ishinomaki City in Miyagi prefecture, but the whaling vessels and the slaughterhouse were repaired and the whaling operation resumed in April 2012 with the same catch quota of 60 whales. As the fishing port that was used to dock the whaling vessels has sunk, and will take some time to be restored, the whale meat will be unloaded near a ferry port and shipped to the slaughterhouse by truck.

By April 19th, 500kg of whale meat was put out for bid, and it was reported that it was sold at 4,300yen to 5,300yen per kilo, with the average price being 4,800yen. This is three times more than the bidding price of frozen whale red meat supplied by Nisshin-Maru and research whaling.

The whale meat sold here is fresh and not frozen, and since the custom of eating whale meat sashimi is more strongly rooted around Ojika peninsula compared to other regions, there is a certain level of demand in the area for the locally produced fresh minke whale meat. The relatively high bidding price could also reflect the community’s wish for the quick recovery of the community from the earthquake/tsunami disaster.

The total fresh minke whale meat produced by the coastal research whaling in this region only amounts to more or less 100 tons, but there is an added-value to the meat, which is the freshness that the ICR/Kyodo Senpaku cannot provide. This strength is surely encouraging to the local fishermen.

Although Nisshin-Maru was able to wrangle 2,380 million yen from the third supplementary budget with the excuse to “contribute to the recovery of Ishinomaki City,” the meat produced by their research is discharged in Tokyo, and the profit actually never benefits Ishinomaki City. There is no plan of building cold storage in Ishinomaki even though the city could earn the storage fee this way. If having a few crewmembers living in Ishinomaki and areas in the vicinity can be called “the contribution to the recovery of Ishinomaki City,” it leads one to believe that a reprehensible budget such as this is actually not uncommon. The government that calls for tax hikes while blatantly allowing such use of taxpayer’s money should be criticized by the public.

Discount of Research Whale Meat: Nationalization of the Operation

What then, will they do with the new auction system? If the bidding is to be continued, the minimum selling price will have to be further lowered in order to sell, but even then, the sales are not promising. That is because, as it has been pointed out repeatedly in IKAN Newsletters, there is so little demand for whale meat on the market.

Meanwhile, the cost of research whaling operation is still covered by the sales from whale meat. Since the research vessels cannot leave port if the sales don’t make any profit, those in the whaling industry and some Diet members are requesting “the research whaling be government-funded.” Securing a budget under the name of “Ishinomaki recovery” probably cannot be used again (That being said, there is a concern that anything is possible for this government that is in haste to restart nuclear power). In any case, if they cannot sustain themselves, they will have to procure funding somewhere else, be it taxpayer’s money or not.

The author has had a theory about this since 2003. That is, the ICR, which is currently the main research body, will be absorbed by the National Research Institute of Far Seas Fisheries under Fisheries Research Agency (FRA). Pros and cons aside, if they are desperate to continue research whaling it seems to be the most likely option.

The same scenario was suggested by Rep. Yoshitaka Ito (a former mayor of Kushiro City in Hokkaido) at the House Committee on Agriculture, Forestry and Fisheries on March 21st. What he suggested was virtually the nationalization of research whaling. He further went on by saying that the whale meat should be sold more cheaply and the proceeds should go into the state coffers. This type of treatment is unheard of for any marine resource research.

Regardless, if the FRA is to manage the research program, it is more agreeable than the current situation. The Agency will focus solely on the academic research without concerning itself with making profit out of it where the current practice is designing a research program based on making money from the meat sales. They will also be able to put more effort into non-lethal research. Furthermore, even if they catch a few whales, if the scale of whaling becomes closer to the image the IWC member countries had for “scientific whaling” before 1970s, this will make it easier for the Ministry of Foreign Affairs to make negotiations in the international arena.