FOPO Committee Meeting

37th PARLIAMENT, 3rd SESSION

Standing Committee on Fisheries and Oceans

EVIDENCE

CONTENTS

Tuesday, May 11, 2004

Á

1105

The Chair (Mr. Tom Wappel (Scarborough Southwest, Lib.))

Á

1110

Mr. Eric Wickham (Executive Director, Canadian Sablefish Association)

Á

1115

Á

1120

The Chair

Mr. John Cummins (Delta—South Richmond, CPC)

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Á

1125

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Á

1130

Mr. Eric Wickham

The Chair

Mr. Jean-Yves Roy (Matapédia—Matane, BQ)

Mr. Eric Wickham

Á

1135

Mr. Jean-Yves Roy

Mr. Eric Wickham

Mr. Jean-Yves Roy

Mr. Eric Wickham

Mr. Jean-Yves Roy

Mr. Eric Wickham

Mr. Jean-Yves Roy

Mr. Eric Wickham

Mr. Jean-Yves Roy

The Chair

Mr. Eric Wickham

The Chair

Mr. Eric Wickham

The Chair

Mr. Eric Wickham

The Chair

Mr. Eric Wickham

The Chair

Mr. Paul Steckle (Huron—Bruce, Lib.)

Mr. Bob Wood (Nipissing, Lib.)

Mr. Eric Wickham

Mr. Bob Wood

Á

1140

Mr. Eric Wickham

Mr. Bob Wood

Mr. Eric Wickham

Mr. Bob Wood

Mr. Eric Wickham

Mr. Bob Wood

Mr. Eric Wickham

Mr. Bob Wood

Mr. Eric Wickham

Mr. Bob Wood

The Chair

Mr. Paul Steckle

Á

1145

Mr. Eric Wickham

The Chair

Mr. Eric Wickham

The Chair

Mr. Eric Wickham

Mr. John Cummins

The Chair

Mr. John Cummins

The Chair

Mr. Eric Wickham

The Chair

Mr. Eric Wickham

The Chair

Mr. Loyola Hearn (St. John's West, CPC)

Á

1150

Mr. Eric Wickham

The Chair

Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern Shore, NDP)

Mr. Eric Wickham

Mr. Peter Stoffer

Mr. Eric Wickham

Mr. Peter Stoffer

Mr. Eric Wickham

Mr. Peter Stoffer

Mr. Eric Wickham

Mr. Peter Stoffer

Mr. Eric Wickham

Mr. Eric Wickham

Mr. Peter Stoffer

Mr. Eric Wickham

Á

1155

Mr. Peter Stoffer

Mr. Eric Wickham

Mr. Peter Stoffer

The Chair

Mr. Carmen Provenzano (Sault Ste. Marie, Lib.)

Mr. Eric Wickham

Mr. Carmen Provenzano

Mr. Eric Wickham

Â

1200

Mr. Carmen Provenzano

Mr. Eric Wickham

Mr. Carmen Provenzano

Mr. Eric Wickham

Mr. Carmen Provenzano

The Chair

Mr. Loyola Hearn

Mr. Eric Wickham

Mr. Loyola Hearn

Mr. Eric Wickham

Â

1205

Mr. Loyola Hearn

The Chair

Mr. Peter Stoffer

Mr. Eric Wickham

Mr. Peter Stoffer

The Chair

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

Mr. Eric Wickham

Â

1210

Mr. John Cummins

Mr. Eric Wickham

Mr. John Cummins

The Chair

Mr. Paul Steckle

Mr. Eric Wickham

The Chair

Mr. Eric Wickham

The Chair

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CANADA

Standing Committee on Fisheries and Oceans

---

NUMBER 015

l

3rd SESSION

l

37th PARLIAMENT

---

EVIDENCE

Tuesday, May 11, 2004

[Recorded by Electronic Apparatus]

Á  (1105)  

[English]

    The Chair (Mr. Tom Wappel (Scarborough Southwest, Lib.)): The meeting is called to order.

    Today, pursuant to Standing Order 108(2), we have a briefing session by a representative from the Canadian Sablefish Association, who is Mr. Eric Wickham, executive director.

    Welcome, sir. What we'll do is give you an opportunity to make an opening statement, approximately 10 minutes, if you don't mind, and then we'll go to questions.

    I would appreciate it if members would stay after this session so that we can have hopefully a relatively short discussion on future business.

    Away we go. Mr. Wickham.

Á  (1110)  

    Mr. Eric Wickham (Executive Director, Canadian Sablefish Association): Thank you. I guess I'll start by saying I have good news and bad news.

    I'll start with the good news. The minister was here a few weeks ago and used our fishery as an example, as a model fishery. And he's absolutely correct. It's an excellent fishery. Right now the stock assessment shows the stocks are as large as they were as virgin stocks before the fishery started. After 40 years of fishing we have very healthy stocks, a strong export market, and we're fishing with a trap method that's pretty clean. We don't get much bycatch and we are certainly not plowing up the bottom. So that's the good news. Everybody's really happy with the fishery. It's owned basically by small businessmen. There's one licence owned by a big corporation, but the rest are owned by the fishermen who started the fishery.

    We have a joint agreement with the Department of Fisheries in management where, as executive director, I collect over $2 million from our 48 members, and we use this for management, science, and enforcement. We have a very good relationship with the local DFO people on doing this. I'm in daily contact with management and science people. We have hired some outside scientists, two world-class scientists out of Washington State, who work with us and with DFO science. It's a collaboration that works very well.

    There's only one reason why this couldn't go on for hundreds of years. The stock is in good shape and we're catching a very moderate amount of it. Right now the catch next year will be 4,500 tonnes out of a stock that we think is somewhere between 60,000 tonnes and 80,000 tonnes. That's just a fishable biomass. We're not looking at sub-legals or areas where we don't fish. So all that looks well.

    But the reason I'm here is because we have such a strong market in Japan—it's one of the most valuable fish out of British Columbia—the aquaculture industry is looking to expand to this side. They're looking at our markets and looking at the fact that we get three to four times the price they're getting for salmon. Their infrastructure, the salmon pens and stuff, would be very easy to switch over to sablefish.

    The department has spent hundreds of thousands of dollars--I'm not sure of the total--doing research on how to hatch out and farm sablefish, and they have been assisting the industry on getting the technology together to do it. The industry is prepared to go into it in an industrial way now, but what lacks is there hasn't been one dollar or one minute spent on looking at the interface between the wild fishery and the farmed.

    Sablefish live out in deep water. We fish them in 500 metres to 1,000 metres of water. That's where the adults live, out off the Continental Shelf. But the juveniles spend the first two to five years of their life in the fjords, in the inlets, in where all the salmon farms are. So the salmon farms that are going to switch over are actually bringing in an exotic species. They're bringing adult sablefish into a juvenile rearing area. So they're bringing in a different species, and there's been no research done on what this will mean. Will there be disease transfer? Will there be parasite transfer? There has been absolutely not one penny spent on that.

    The provincial government's position is, well, we'll just do it and see what happens. Our position is that's not good enough. You're basically risking the wild resource by doing this. Let's do the research. Let's do a proper environmental assessment, and that proper environmental assessment means sitting down and spending the time to find out where the juveniles are on the inside.

    The only research that has been done has been done by us. The fish farm industry doesn't have a clue where the juveniles are. We have some limited information on it. The department will tell you they're in just about all the inlets where the fish farms are. So first you have to find out where they are. Then we have to do the research and find out whether disease or parasites from the adults will transfer to the juveniles. Are we going to introduce diseases that the juveniles have never seen before, as happened with the sea lice thing on salmon? Is that a possibility? Are these going to become what Daniel Pauly from the University of British Columbia called salmon farms, cesspools of disease and parasites? Is that what's going to happen or not? Let's do the research first.

    The department is doing environmental assessments, and it has claimed that it's writing the criteria now for sablefish. It won't tell us what those criteria are. It won't let us get involved in the process, and it has just said it will let us know in a couple of weeks.

    The local aquaculture division of the Department of Fisheries and Oceans is writing the criteria, which is totally inappropriate. The correct people are the scientists within the department we've been working with and our scientists. We have two world-class scientists out of Washington who've been working for a decade with us on these stocks. They're not involved; we're not involved. We've been told the criteria will be written in a few weeks, and we'll be told about it later. There is talk of starting sablefish farming as early as this summer, but three or four years of research need to be done before you start putting fish in the water, or you're risking the wild resource.

Á  (1115)  

    We have a very healthy fishery that doesn't cost the taxpayers a penny. It's probably the only fishery in North America that makes money for the taxpayers. We pay $1 million in licence fees--that's 48 guys paying $1 million in licence fees--and we collect over $2 million to do the science and research. We give the department $100,000 for enforcement. We pay $250,000 for a private enforcement agency. We pay for one and a half science positions within the department, besides hiring two outside the department. We do it basically because we want to keep control of the fishery; we want to make the fishery well looked after. It's the only fishery I've been involved in where, in a conference call with all the directors about three or four years ago, they talked about going to DFO and asking them to shut it down, because we were worried about the stocks. We had a bad survey that year and as fishermen we were talking about shutting the fishery down. We actually went to DFO and said we would give back 30% of the quota for that year, and we wanted them to reduce the catch by 50% the next year. That's because the fishermen look at this as their fishery, and we're going to manage it and make sure it lasts for a long time.

    In doing that, we have to make damned sure we don't start building cesspools of disease in the juvenile rearing areas. Salmon pass those salmon farms fairly quickly, and they catch disease and parasites. Our juveniles are in that area for two to five years. It's not quick. The other side is that it seems to be one stock between Alaska and British Columbia. It's a big fishery in Alaska, about five times bigger than ours, and with our tagging of juveniles in the inlets, we've found that 40% of the tags we got back came back from Alaska from adults. So if we introduce some exotic disease to the juveniles, we're introducing it to the Alaska stock too. The Americans have outlawed net pen farming in Alaska, so they're not too happy about this. It's not a neighbourly thing to be doing to take this kind of risk.

    I'll finish at that point. Thank you for the time.

Á  (1120)  

    The Chair: Thank you very much, Mr. Wickham.

    I'm sure the committee members have questions.

    Mr. Cummins.

    Mr. John Cummins (Delta—South Richmond, CPC): Thank you, Mr. Chairman.

    Back in September 2003 I put some questions on the order paper regarding the sablefish fishery, and I've yet to receive an answer to them. I've complained to the Speaker. There were answers prepared, and I actually received them under access to information. I think they may be interesting, because they reflect on what Mr. Wickham said. So what I'm going to do, Mr. Wickham, if you don't mind, is quickly read the questions and the government's responses, and you may have a comment on those responses as well.

    One of the questions I asked was whether a comprehensive environmental impact analysis of halibut and sablefish aquaculture was completed under the Environmental Assessment Act, the Fisheries Act, the Navigable Waters Protection Act, or some other authority, and the government said no. Is it correct that no assessments were done?

    Mr. Eric Wickham: That's correct.

    Mr. John Cummins: The question was, has a comprehensive economic impact and cost-benefit analysis of halibut and sablefish aquaculture been undertaken? The department said no comprehensive study has been done. Is that correct?

    Mr. Eric Wickham: That is correct.

    Mr. John Cummins: The question was, have guidelines been developed for the siting of halibut and sablefish aquaculture that would prohibit placement of halibut and sablefish net pens in nursery and juvenile rearing areas in coastal inlets, bays, and fjords? The response was that no formal siting guidelines had been established. Again, according to your testimony, that's correct.

    Mr. Eric Wickham: Yes.

    Mr. John Cummins: Have authorizations or approvals been given for the establishment of halibut and sablefish net pen aquaculture operations in coastal British Columbia, and if so, what are the locations? It says that no CAA assessments have yet been completed for either halibut or sablefish net pen aquaculture operations in British Columbia, but they're going ahead. Is that correct?

    Mr. Eric Wickham: Yes, they appear to be. There's one industrialized hatchery that's going to hatch out--I'm not sure of the numbers--hundreds of thousands of juveniles this summer that they want to put into the water. The province has given licences to 50 different sites for sablefish.

    Mr. John Cummins: You mentioned the province. We were told to go to the province to find out which halibut or sablefish operations have not had Canadian Environmental Assessment Act assessments. Is it strange that you would go to the province to ask about a Canadian environmental assessment? The answer that was prepared for my question suggested that we do. It says the Province of British Columbia is responsible for issuing licences for hatchery and fin fish aquaculture facilities in fresh water and marine environments and should be contacted directly for specifics on hatchery locations.

    Is that the procedure, to go to the province for a response here?

    Mr. Eric Wickham: It's pretty hard to get stuff out of the province--they're tighter than DFO. The locations, or even the fact that the province has given 50 licences, we got from DFO enforcement. The enforcement people we work with to go after our guys who might be cheating happened to have a list of all the salmon farms that had been passed by the province for sablefish, and they gave it to us. The province never gave it to us, although we requested it and requested it.

Á  (1125)  

    Mr. John Cummins: We asked what studies or research had been undertaken or funded with regard to diseases and parasites associated with halibut and sablefish aquaculture, their possible transfer to wild stocks, and what were the findings. We were told that there were no studies or research specifically focused on diseases and parasites associated with Pacific halibut or sablefish aquaculture. If no studies have been done, is it more than passing strange to you that government is considering establishing these sites without adequate study?

    Mr. Eric Wickham: I think it's totally irresponsible. They have done a fair bit of research on how to hatch out and spawn sablefish. One of the papers here says DFO has found out that adult sablefish have about 20 different possible parasites and about 20 different diseases on them. So this is what you're introducing. Nobody has done any research on the juveniles to see if they are resistant to those diseases, they have diseases, or anything. There's been not one penny spent on that. That's where the research should be, on what happens when you take a bunch of sablefish, put them in a juvenile area, and they get diseases: will they pass to the juveniles or not?

    Mr. John Cummins: As well, of course, the government said no studies or research were undertaken as to what would be the likely effect of scabies from that. So again, no research has been done, according to the government.

    Mr. Eric Wickham: Research, no.

    Mr. John Cummins: We asked about the cost-sharing funding arrangements for research and development work undertaken by Fisheries and Oceans and were told the sablefish broad stock development project is funded by $305,600 from DFO, while the industry partners contributed $29,500 in cash, plus in-kind contributions. That sablefish broad stock development project is the one that's located on Salt Spring Island, is it not?

    Mr. Eric Wickham: That's correct.

    Mr. John Cummins: The government is telling us they funded it with an amount about ten times the funding of private enterprise. Is that consistent with your knowledge?

    Mr. Eric Wickham: That's consistent with my knowledge.

    Mr. John Cummins: So where's the drive coming from for this sablefish operation on Salt Spring? Is the initiative from the department or from the private enterprise?

    Mr. Eric Wickham: The initiative seems to be from the department. The department has been doing the research on how to farm sablefish for up to a decade. I speculate that the salmon farming industry is pushing for it, because it's a really quick switch over to a species that has a much higher market value. They're not concerned about the interface with the wild resource. Let's be honest, if the wild resource disappeared, it would get rid of their biggest competitor. The department, which should be concerned about it, does not yet seem to be at this point.

    Mr. John Cummins: The interaction between the wild stock and the juveniles that are on these inshore ledges, or close to shore and to the areas where these farms are, has to be cause for concern. In the document you prepared it suggests that there's quite a difference between the sablefish and the salmon, and it points out that the net cages are located more often than not in areas where the contact is brief, because the salmon merely interact with the caged fish as they swim by on their migration routes, whereas with sablefish, the problem seems to be greater, because the pens are actually located in these spawning and juvenile rearing areas. You have experience in both the salmon fishery and the sablefish fishery. Do you see the problem for sablefish farming to be greater than that for the net pen aquaculture in salmon?

Á  (1130)  

    Mr. Eric Wickham: Significantly. You shouldn't go ahead and farm in a juvenile rearing area, in my mind, without doing all the research and finding out for sure that there's no possibility of disease parasite transfer. As you said, the salmon pass through those areas fairly quickly, and still it's been a major problem. We've all heard about the Broughton Archipelago, where a run of over 3 million pinks was devastated, down to a little over 100,000, in seven rivers because of the sea lice transfer from fish farms to the juveniles as they were going by, introducing something juveniles weren't familiar with at all, the sea lice.

    These are the kinds of things we're concerned about. The research, as I said, has shown that adult sablefish can have about 20 different diseases and about 20 different parasites. Nobody is looking to see if the juveniles have these or whether they're resistant to them. So in my mind, it's putting the whole fishery at risk. When I say the whole fishery, that's about $30 million a year that comes into British Columbia and about $120 million that goes into Alaska. So it's in the same range as the Alaska salmon fishery. It's really significant between the two of us. And you're putting the whole thing at risk just because you didn't do the research, largely because somebody wants to rush into it as fast as they can.

[Translation]

    The Chair: Mr. Roy, you have five minutes.

    Mr. Jean-Yves Roy (Matapédia—Matane, BQ): Thank you, Mr. Chairman.

    I was reading the summary of the document entitled Study of Supply Side Effects on Sablefish Market Price. Why would fish farmers have any interest in undertaking sablefish fish farming if your predictions are accurate?

    After a certain period of time, market prices will drop to such an extent that farmers will produce only enough to cover the costs of production. What is the point of undertaking sablefish farming if it is expected that four or five years from now prices will have declined to such an extent that it will no longer be worthwhile to farm these fish? This is the conclusion of your study.

[English]

    Mr. Eric Wickham: Yes, that's correct. That's a good question. I would like to ask that of the aquaculture industry. They do not return our calls, so we don't have a dialogue with them, but I suspect it's like the rush to the fisheries. We rushed into fish knowing that everybody was not going to make money, but the first guys in tried to make money. I think that's what it is. With this hatchery now, he's not concerned that it will flood the market; he's just concerned about doing very well selling his fingerlings, and the first few thousand tonnes will do very well in our market, until they collapse it.

    I think you have an executive summary there of a study the American fishermen have done through the University of Washington. This study will be released next week. It cost them about $50,000 to do an economic study on the marketing of sablefish, and it shows exactly that. It will collapse. The market for sablefish is smaller, about 1% of the salmon market, so it'll collapse very fast, and the cost of producing sablefish will collapse down to a production level, for both wild and farmers, and when it gets down to that level, the technology will get exported to a place where it's cheaper to do it, like Chile.

    So basically what we're doing in Canada is spending a lot of money and effort developing a technology that our people can use for the first guys in to make some money. Then, at some point, it will collapse to where nobody's making money, and it'll go to Chile or another cheap place to do it. So we're exporting an industry.

Á  (1135)  

[Translation]

    Mr. Jean-Yves Roy: So you fear that certain countries, Chile among others, will use the fish farming technology which has been developed here to farm sablefish, destroy our sablefish fishing industry, and even eliminate this type of fish farming should it be done here.

[English]

    Mr. Eric Wickham: Yes, that's exactly correct.

[Translation]

    Mr. Jean-Yves Roy: You also referred to a study which was done in the United States and which should be released soon. Would it be possible for you to give us a copy of that study when you have it?

[English]

    Mr. Eric Wickham: Of course I will, as soon as it's available.

[Translation]

    Mr. Jean-Yves Roy: Is the Department of Fisheries and Oceans aware of the potential impact of sablefish fish farming? What was the response of the Department of Fisheries and Oceans when you mentioned that your studies prove that such a production would have an extremely negative impact on the viability of the fishery that is being done currently?

[English]

    Mr. Eric Wickham: In the DFO local aquaculture division in British Columbia their response is, don't worry about it, we're looking after things. We're going to write the criteria, we don't want your involvement, we're looking after things. We met with DFO in Ottawa here yesterday, and it appeared that it was sort of new information. There were no promises, but I was optimistic from their response that they would look into it.

[Translation]

    Mr. Jean-Yves Roy: What do they mean when they say that they are going to deal with it?

[English]

    Mr. Eric Wickham: It's like having bank robbers write the laws about robbing banks, in my opinion, and that's not taking care of it. It can't be trusted.

[Translation]

    Mr. Jean-Yves Roy: Thank you.

[English]

    The Chair: Thank you, Monsieur Roy.

    What is the name of the person in DFO in British Columbia who is in charge of this?

    Mr. Eric Wickham: The name of the person is Alison Webb. She's in charge of habitat and aquaculture, which, in my opinion, is a conflict of interest.

    The Chair: And your evidence is that she is refusing to speak to you?

    Mr. Eric Wickham: We've had two one-hour meetings in the last year. It's taken two months to get a meeting, and very little information is given to us.

    The Chair: Who is the person you spoke to yesterday at DFO?

    Mr. Eric Wickham: A Mr. Bouchard and a Mr. Bevan. There were some other people there, but I don't have the names.

    The Chair: That is sufficient. We recognize the names.

    You were cautiously optimistic, but no promises were made.

    Mr. Eric Wickham: Exactly.

    The Chair: Mr. Wood, and then Mr. Steckle, if you split your time.

    Mr. Paul Steckle (Huron—Bruce, Lib.): Yes.

    Mr. Bob Wood (Nipissing, Lib.): Mr. Wickham, why the rush? Why are they putting on a rush here?

    Mr. Eric Wickham: The only thing I can see, and it's pure speculation, is that it's the rush to dollars. The salmon farming industry has collapsed; the value of salmon is down so low now that they're producing at a loss, and they've been doing so for a couple of years. Suddenly they see a species they can switch over to with hardly any capital costs and get three times the price. That's the only reason I can see why the industry wants to rush into it. Their cost would maybe be the loss of the wild resource, but they're not concerned about that cost. That's getting rid of a competitor. There should be no rush from DFO, no rush from government. Government should be backing off for a few years, doing the studies, and then talking about trying to keep it in British Columbia, trying to keep it in Canada, and that can be done too.

    The only places in the world where there are sablefish are Alaska, British Columbia, and Washington. Alaska does not allow net pen farming, does not allow brood stock to be exported. If we did the same kinds of things, we could keep it here. We could do the research and find out a safe way to do it, give it the time, four or five years, and make laws for protection, so that live adults can't be exported and it will stay in British Columbia. Right now they can export live adults to Chile and they've got their brood stock to do it in Chile, and we're giving them the technology.

    Mr. Bob Wood: It's probably the first time they've ever rushed into anything in their lives. Most of these guys are so slow they need a quarter for cab fare.

    How sensitive are the markets likely to be to more production of farmed sablefish?

Á  (1140)  

    Mr. Eric Wickham: The worldwide production is around 30,000 tonnes. It goes into a little niche market in Japan. The study that will come out of the University of Washington in the next couple of weeks will show that if you increased it another 30,000 tonnes, if you doubled it, it would drop the price down to about what it costs to produce the fish. After that, you've actually saturated the market.

    Sablefish is not something that can go out on a broad-based market. It's a very rich-tasting fish, and it's not that attractive, actually, to the North American palate. North Americans like it a lot milder. So we've never been able to market it very well in North America or Europe. The Asian palate likes it, but the market is fairly limited in Japan, so it will crash.

    It's interesting, the aquaculture industry put out a big report about a month ago--I'm sure you're aware of it--on the future of aquaculture and what not. In it they mentioned that B.C could produce 126,000 tonnes of sablefish. Well, the study from Washington will show that the price for that would be zero. There's absolutely no market for it.

    Right now the market could handle a bit more than 30,000 tonnes, so we have a demand market. It could maybe get up to 40,000 and be okay, but after that it would start to collapse.

    Mr. Bob Wood: Have any licences been issued yet for sablefish farming in B.C.?

    Mr. Eric Wickham: The province has issued about 50 of them to salmon farms. One farm has a licence to put 500,000 Atlantic salmon on the same site with 500,000 sablefish, together, with no studies done on what could transfer back and forth.

    Mr. Bob Wood: When can they do this, anytime they wish, or are they going to have to wait until the so-called rush on this study comes up?

    Mr. Eric Wickham: No, they can do it anytime they wish. The only thing that's stopping them now is that they have to do an environmental assessment before they put them in the water. So the only thing that's stopping them is that control from the Department of Fisheries and Oceans. Other than that, they can just go for it and do it.

    Mr. Bob Wood: Is sablefish farming harmful to other wild stock, such as rockfish or whatever?

    Mr. Eric Wickham: That's a good question. Nobody has spent one minute looking at that. Rockfish is an endangered species in a lot of areas, and you're going to introduce farmed sablefish there? Again, it hasn't been looked at.

    Mr. Bob Wood: I just find it really odd and weird that your group is successful, you're spending a lot of money, you're providing costs for scientists who work with DFO, and you're getting nothing in return. These guys probably should be quite excited that there is a fishing group in this country that is making money and also taking care of conservation at the same time. But they don't seem to recognize that, I guess.

    Mr. Eric Wickham: Well, there is a segment within DFO that does. The people we work with are quite excited about what we do. And I read what the minister said here a couple of weeks ago. He used our fishery as model fishery of where he'd like to go in the future.

    So there is a segment of DFO that recognizes this, but there's another side that says it doesn't matter, aquaculture is the wave of the future.

    Mr. Bob Wood: A little ego is getting involved, do you think?

    You don't want to answer that, do you? I'll say yes; I'm not afraid.

    The Chair: Mr. Steckle.

    Mr. Paul Steckle: I don't have a lot of questions, but I do have some commentary along these lines. I see a similarity between your industry and the supply managed industry in agriculture.

    My background is agriculture, and those of us who know that industry know that the SM5 group has done reasonably well. Dairy and poultry products are managed under supply management. We don't inhibit certain products coming in here to a certain level, as guaranteed under our North American agreements. We also don't impede other people's markets, including U.S markets. We produce for the domestic market at a profit to the producer, and we give an assured and safe supply of that product to our Canadian consumer.

    I don't know why we seemingly can't understand--I mean, even in agriculture we haven't learned in any of the other sectors that this seems to work, but it does work--that by doubling a production of whatever that might be, in this case fish stock, we would be putting in peril the whole industry. I don't understand what's so difficult to understand about that. It's just good sense to understand that if someone's making a profit, we can't have it anyhow. If you have a million dollars and I haven't, you're not going to give it to me. If you wish to give it to me, that's fine, but I can't take it from you. If I try to take it from you, there's a penalty for that. The penalty in this case would be that all of us lose.

    Where is Fisheries and Oceans in this? Why do they not understand? Does DFO not have the power to intervene here, to say, listen, if we want to use that as a model, why are we not then protecting it, protecting that species, protecting that industry?

    I just have a whole lot of questions on why we don't learn from our past mistakes. It just makes good sense that we do something. We grow the market as much as we can, and then build to that market, but we shouldn't destroy it because of greed. That just doesn't resonate at all.

Á  (1145)  

    Mr. Eric Wickham: Thank you.

    The Chair: Thank you, Mr. Steckle.

    There's still a little bit of time left on the Liberal side, so I'll bootleg into it.

    Just so I understand, there's a worldwide 30,000-tonne niche market in Japan.

    Mr. Eric Wickham: Actually, it's 90% Japan. About 10% goes to Hong Kong, Taiwan, and other places.

    The Chair: Is there a clamouring in that market for more?

    Mr. Eric Wickham: No. I'm aware of a letter written to the minister from the biggest importer in Japan, saying, we don't want farmed sablefish; we have a very good market structure now; we don't want to increase production by any large numbers, as happened in the salmon industry, so please do not get into farming sablefish.

    Mr. John Cummins: Just for your information, Mr. Chairman, I have a copy of that letter. I can read it into the record in a minute.

    The Chair: Perhaps you can give it to us and we can distribute it.

    Mr. John Cummins: I can do that, sure.

    The Chair: Okay.

    My point is that given that the niche market isn't interested in a lot more fish, it cannot be debated that flooding the market with farmed fish would ruin the market. You're already providing it from the wild stocks. At the very best, one could say that the market could be managed by saying, for example, that these 48 fishermen are only allowed to take 20,000 tonnes, and 10,000 tonnes could be allocated to the aquaculture industry. But to allow...and I'm not suggesting that this is good or bad; I'm just saying that this would at least preserve the niche market and would not flood the market with unnecessary fish, thereby destroying the market.

    Has anybody suggested to you at any time that there should be a sharing between the wild fishery and the aquaculture industry?

    Mr. Eric Wickham: Yes, it was suggested by the biggest sablefish fishermen's association out of Seattle and Alaska. They wrote to our minister and our premier suggesting that. They said, look, if we're going to get into sablefish farming, let's sit down and do a joint marketing board or something.

    No response; no response at all.

    The Chair: Speaking of no response, you said you were not working with the aquaculture industry. Could you tell us what efforts you've made to contact them in terms of trying to have a dialogue with the aquaculture industry?

    Mr. Eric Wickham: When I started on this file about a year ago I phoned the head offices of all the major aquaculture firms out in B.C. There are about five of them, all large European firms. I phoned them and said, let's have a dialogue, let's talk. I got secretaries who said, okay, I'll pass this on, and you'll get a call back. Not one call back.

    At cocktail parties I've run into directors of some of the firms. We've talked, and they've told me, yeah, definitely we should be talking; we'll talk to our people. No call back.

    I've sat at meetings with the head of the Salmon Farmers' Association, and she has not been willing to discuss it.

    Basically, I get the feeling that, you know, we don't need to talk to you guys; we have both levels of government onside. We're going to fly along and do what we're going to do, so why should we bother talking to you?

    The Chair: Mr. Hearn.

    Mr. Loyola Hearn (St. John's West, CPC): Thank you very much, Mr. Chair.

    I'll just be very brief, because I think almost everything that can be said on this has been said. I agree totally with what you're saying, and not only in relation to sablefish. I've always questioned why, when I see so many salmon rivers...and our salmon rivers are nowhere near the ones you have in British Columbia, but over the years we've had prolific salmon rivers that have been completely and utterly neglected, whether it be monitoring, enhancement, or what have you. Of course, the stocks have declined. Then we've let the seals move into the river mouths and take whatever was left.

    There has been no action whatsoever by government, but then they try to go in and experiment and whatever with farmed salmon, to the point where the markets are flooded, where we can't compete with Chile and the other places. Nobody is making money, and it's everybody's problem.

    When are we going to learn? In terms of protecting and enhancing our wild stocks, whether that be salmon, or sable, or cod on the nose and tail of the Grand Banks, we've done a terrible job of it. There certainly has been government neglect--without putting any special colour on government, because it's a rough thing to do. It takes a lot of work to do that. It's much easier to come up with a few regulations than to go out and look at the salmon. You know, there's no real effort there.

    So I agree totally, and I believe it's time we looked at the fact that we should be developing markets where people can start making a living. If we protect our stocks, more and more people can do that. We're getting top-quality product on the market and everything you would want in relation to economics. When it comes to the production of proper food and the guarantee of markets, we have it. And who destroys it? Ourselves. It's generally pretty frustrating when we see what's going on. And that's just a sample. We've heard examples of other fisheries, and I can give you some from home.

    So we agree wholeheartedly with what you're saying. From our perspective, certainly, we support your initiatives totally.

Á  (1150)  

    Mr. Eric Wickham: Thank you.

    The Chair: Mr. Stoffer.

    Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern Shore, NDP): Thank you.

    I had to step out, so I apologize if this question has already been asked, but when Mr. Bastien, the former aquaculture commissioner, did his report, were you people included in those discussions?

    Mr. Eric Wickham: No, not in any way at all.

    Mr. Peter Stoffer: Were you aware that he was doing a study on aquaculture and making recommendations to the government?

    Mr. Eric Wickham: No, I was not.

    Mr. Peter Stoffer: Again, just for the record, Mr. Bastien, as the commissioner, did a fairly extensive study and a report on aquaculture for the Canadian government, and your organization was not included at all in these discussions. You weren't invited. You weren't aware of the discussions at all.

    Mr. Eric Wickham: No, I was not aware until the report was published and we saw it in the public regime. It did have in it that one quote, though, that there's a potential for 120,000 tonnes of sablefish to be farmed in British Columbia. That is ludicrous, just ludicrous, because there is absolutely no market for it. The technology hasn't been clearly developed, and the dangers haven't been covered.

    So I don't know where he got that information from. It looks like it came right out of the sky.

    Mr. Peter Stoffer: Sir, have you written to Mr. Bastien or to the minister to sort of protest the fact that you were unaware of the report, to ask where this figure came from and why you weren't included, and to state that you'd like to have a meeting with him in order to set the record straight?

    Mr. Eric Wickham: No, I have not. I asked the minister for a meeting just recently, and I haven't heard back yet.

    Mr. Peter Stoffer: In terms of British Columbia's no aquaculture rule, which we've known for quite some time, are you soliciting their assistance at all in putting pressure on the Canadian government or the B.C. government to not proceed with sablefish aquaculture?

    Mr. Eric Wickham: Do you mean Alaska?

    Yes.

    Mr. Eric Wickham: Yes, we're working closely with the Alaskan fishermen and with some of the politicians up there. They're just slowly waking up to the issue. They can't really believe what we're doing, to be honest. They can't believe it. They're slowly waking up to the issue. If we damage their resource, they're going to be some excited.

    Mr. Peter Stoffer: Sir, is your organization working at all with first nations groups on the west coast with regard to this issue?

    Mr. Eric Wickham: Thank you for asking that question, because that's something I'd forgotten.

    Yes, we are. One of our biggest licence-holders is a Haida who got his licence right from where they were originally allocated. The Sooke nation about three years ago bought a licence into our fishery, at a very high cost. Two other first nation groups are negotiating licences right now. What's more significant is that the treaty process has offered sablefish licences in treaties. For the one in the Barkley Sound group, it was put in that they're going to give them a sablefish licence.

    Some of these first nation people are saying to us, well, the white man is speaking with a forked tongue again; here he is saying, on the one hand, I'm giving you this valuable, valuable licence, and on the other hand, I'm going to destroy your industry.

Á  (1155)  

    Mr. Peter Stoffer: Sir, I agree with Mr. Hearn's comments and Mr. Steckle's comments that it's frustrating, when you have evidence of a successful fishery that is co-managed, where you pay a lot of your own expenses in terms of scientific research, monitoring, etc.... I mean, this is what we'd like to have right across the country in that it actually works. You obviously feel very threatened now by a proposed aquaculture development of the wild species, which is sable, that will put you right out of the market.

    I guess I'm asking on behalf of the committee, although I'm not really supposed to, what you would like this committee to do with regard to our approach to the minister or to the government in terms of raising your issue to them.

    Mr. Eric Wickham: I don't really understand the powers of the committee, but we'd like the committee to in some way encourage the government to do a proper environmental assessment before any fish goes into the water, before any fish goes into the ocean. And we must be involved in that environmental assessment. We have to be involved. The best scientists in the world on sablefish are the people who work in DFO and for us. So we have to be involved in that assessment.

    The LGL study I have here goes through all of the criteria, and it goes through what you have to take a look at. You have to get a location on land and take a look to see if there is disease transfer. Perhaps put some diseased fish in with some....

    So we do have to do all of that. It will take two or three years, but let's go through it and let's find out the dangers. Let's find out exactly the areas where the juveniles are in the inshore areas. We don't know that yet.

    That's what we'd like from the government. The government now says it's going to do environmental assessment for salmon, and then it's going to tweak it and do something for sablefish. It doesn't even have the criteria yet--it's just writing the criteria--and we're going to get informed after it's written. That's not good enough. That is not good enough. We have to be involved in sitting down, looking at the criteria, and doing the research before any fish goes into the water.

    Mr. Peter Stoffer: Thank you very much.

    The Chair: Thank you, Mr. Stoffer.

    Mr. Provenzano.

    Mr. Carmen Provenzano (Sault Ste. Marie, Lib.): I just have a question, Mr. Chair.

    I'm trying to get my mind around the point you were making about the Chileans. Can you explain that again, because I'm not sure I understand it?

    Mr. Eric Wickham: Okay, sure.

    If you start farming sablefish, when you get up to around 60,000 tonnes, the market will be paying $2 per pound. Right about there is the break-even point for the fish farmers in British Columbia; that's their cost price.

    In the fish farming industry, the guys doing it in British Columbia are Dutch and Norwegian firms that have operations in Chile; they're the same people. So they'll take a look at that and say, we can raise that fish for $1 per pound in Chile. We've got the technology; the government has developed it for us in Canada. We've got it now and are using it in Canada, so we'll just take that technology and do it in Chile. The sablefish eat basically the same food as salmon—though you need a lot more oil, which is an interesting point. So it's the same thing; it's a carnivorous animal that we're going to feed four or five pounds of fish. But they have the food down in Chile, they have the cheap labour, and they have a lot more lenient environmental laws.

    So that's where you'll see it go. You'll see it go where salmon is going now. Frankly, in my opinion, the B.C. salmon farming industry is on a downhill slope that it will never return from, and it will be done in Chile and third world countries. We're not competitive.

    Mr. Carmen Provenzano: What I'm missing, Mr. Wickham, is how to control what happens in Chile.

    Mr. Eric Wickham: Well, that's a good question.

    First off, we're the only country in the world that started developing the technology for how to farm sablefish, which is foolish. Second, we're giving it away free to anybody who wants it. But the key is brood stock; you need the adult sablefish, which are very particular. It takes a couple or three years to get them conditioned to be in ponds and stuff like that. You need the adult sablefish, which you can only get from Alaska, British Columbia, and near Washington State. That's it, period. So we control that; there's our control.

    Having no exports of live sablefish would stop Chile dead. They don't have the brood stock—and you need a fair bit of brood stock. You've got to keep turning it over for genetic difference, and you've got to find the good ones, so it takes quite a few.

    One person I know who is involved in it said, “If you flew adult sablefish in an airplane, you're going to wait about two years after that before you're going to get any spawn out of them, because they're going to be so freaked out.” He said, “We've found that it takes two or three years after just coming out of the wild and putting them into a pen before they'll start spawning again.”

    So we have some controls on it. First off, let's not give that technology away so freely; let's not pass it out for anybody who wants it. And second, let's put controls on the export of live sablefish and not allow the brood stock, because the market doesn't want live sablefish. It's never exported live anywhere.

  (1200)  

    Mr. Carmen Provenzano: Thank you.

    Let's just make a couple of assumptions. Let's assume that the environmental assessment you talk about is conducted and that the aquaculture industry manages to survive that assessment. And let's assume there are practices in place that allow the rearing and production of sablefish without negative environmental consequences; that's an assumption. Let's assume at the same time that we have a sustainable sablefish fishery.

    Given those two situations, would you be here asking the government to prefer the natural fishery over the aquaculture industry's raising of sablefish?

    Mr. Eric Wickham: No, I would not. I'd be talking to the sablefish farmers and saying, “Let's do a marketing strategy. Let's work it so that we're not going to flood the local market. Let's work something out to the benefit of both of us.”

    Mr. Carmen Provenzano: Otherwise, what you're really talking about is the federal government or provincial government—I don't know where the jurisdiction is on this—actually regulating the marketplace for that particular species of fish.

    To what extent can you do that? To what extent can the federal or provincial government actually regulate the industry, where the species is not threatened in the wild and where that particular fish is able to be reared in net pens without negative consequences? How do you reconcile those?

    Mr. Eric Wickham: I think the industry should control itself in the market. If we had any sense, we would get together and work something out. It's not a government responsibility. I would think the fish farmers would be open to that possibility, after they've seen what's happened with salmon. The salmon farmers can't regulate themselves worldwide, and they keep the market collapsed, so none of them make any money.

    Mr. Carmen Provenzano: Thank you for your answers.

    The Chair: Thank you, Mr. Provenzano.

    We'll have just a couple of quick questions from members.

    Mr. Hearn, you wanted to ask a question.

    Mr. Loyola Hearn: I'm just wondering about predators. Does the sablefish have a specific predator or a number of predators, or is predation a problem?

    Mr. Eric Wickham: That's a good question. We don't really know. There's a lot of knowledge we don't have. They're a very deep-water fish. We get very little bycatch of anything, so they're kind of on their own out there. We do notice that they come up into the shallows behind other species, so they seem to be scared of other species. But I don't know what their natural predator is, other than disease. They have a lot of disease.

    Mr. Loyola Hearn: In deep water--it seems they adapt to cooler temperatures. How is that going to jive if you have shallow-water pens?

    Mr. Eric Wickham: Those are all the questions that have to be worked out. It appears from the work they've done so far that sablefish are pretty hardy in the pens, and surprisingly, they do okay on the surface. They're used to 500 metres to 1,000 metres of depth, but they do okay on the surface in pens.

    This has been done on an experimental basis. As you can see in the paper, most of them go blind because they're not used to the light. But they survive, eat, and grow. There's really been no production done where they've.... There have just been a few experiments where they've been fairly spread out and well looked after. There are no production facilities like salmon, where you jam a whole bunch in together and try to grow them in volume. It's unknown yet what will happen.

    We also don't know what quality of fish you'll get for meat. The sablefish is normally a fairly soft, mushy fish. In fact, all our freezer boats freeze it right away because it doesn't stand being kept for three or four days and brought ashore. If you start farming them and get less muscle structure because they're just in a pen and don't get to swim, as happens with salmon, you might just get a pile of mush. This might not be doable at all. I don't know.

  (1205)  

    Mr. Loyola Hearn: It seems a bit unfair. You can see what you're eating, but they can't see who's eating them.

    The Chair: Mr. Stoffer.

    Mr. Peter Stoffer: Sir, are you aware of any sablefish aquaculture going on right now?

    Mr. Eric Wickham: I'm aware of three hatcheries right now. One has given up on it. One has had no success. His last hatch was over a million last year, and they all had lockjaw and died within a few weeks. On the third one, I don't know what he's doing. I understand he's a world-class scientist. He's the only one who has ever had any success. Our expectation is that he will succeed.

    DFO science people who have worked on sablefish say the technology has been developed and it's easy to do. I don't know. We know that this fellow has built the first production hatchery on Salt Spring Island. He's telling his investors he's going to have large volumes of juvenile sablefish to put in the ocean by this summer. There's been no environmental assessment done for any of those ocean pens yet.

    So that's the state of the industry.

    Mr. Peter Stoffer: Thank you.

    The Chair: Mr. Cummins, I think the committee has a very good handle on the evidence, but do you want to ask a couple of quick questions?

    Mr. John Cummins: I think there's some information that's rather interesting. As Mr. Wickham has noted, the market for sablefish is small and is currently filled by the wild fishery, without any impact or negative consequences on the stock. So you have to ask yourself why the government is promoting aquaculture.

    I raised this issue last September, and through access to information we prepared a question period card for the minister. The response to those concerns was:

Japan continues to be the price setter for sablefish. There is also an established market for sablefish in the United States (California). The current wild fishery cannot satisfy the demand. The increasing demand for white fleshed fish in the US could be exploited by sablefish if a consistent supply were made available to buyers.

    The next point is:

Aquaculture could compliment the wild fishery by increasing demand, by providing a constant supply and by stabilising prices. Aggressive marketing in the US could lessen Japan's control of prices benefiting both the wild fishery and aquaculture producers.

    Those comments are a bit of a stretch, are they not?

    Mr. Eric Wickham: That's a hell of a stretch. We only produced 4,500 tonnes this year. Alaska produces well over 20,000 tonnes, and they can't sell it in the U.S. They sell it in Japan. We've been to the fish trade shows in L.A. dozens of times trying to push our product, and you can sell a small volume. In Brussels at one time we passed out I think 7,000 or 8,000 crackers with pieces of sablefish on them. A lot of people liked it--no orders. It's an illusion to think you can just go in and develop a market without a lot of money and a lot of marketing effort. So that's a fantasy, what you just read there, Mr. Cummins.

    Mr. John Cummins: There have been no studies done on the interaction of wild stock and sablefish, but I think it's important to note that that interaction may not necessarily be localized. Your tagging information suggests that the interaction between these caged fish and juvenile stocks could well be across the northwest Pacific. Is that not correct?

    Mr. Eric Wickham: That's correct. As I mentioned before, out of the juveniles we tagged in our inlets, 40% came back from Alaska, and some of them from the Aleutian Islands, that far away. And we have tagged fish from British Columbia that have come back off Los Angeles. So the stock travels. The one licence the province has given out is for 500,000 Atlantic salmon in the same site with 500,000 sablefish. If you put those two together and the Atlantics introduce some exotic disease or parasite to those juvenile sablefish, those sablefish will live for many years, if they don't die from it, and spread it all over the North American west coast; they'll spread it everywhere. And the big losers will be Alaska. They have around $120 million annually of sablefish catch up there, and if we introduce a disease or a parasite to their stock, it's a big loss--a loss as close to the level in their salmon fishery.

  (1210)  

    Mr. John Cummins: And there will be repercussions, I think that goes without saying.

    Mr. Eric Wickham: It's not a very neighbourly thing to do.

    Mr. John Cummins: It should be noted that Mr. Wickham is an author, and if you haven't read his book, Dead Fish and Fat Cats, you ought to. It's an excellent commentary on DFO.

    The Chair: Mr. Steckle.

    Mr. Paul Steckle: Mr. Wickham, you mentioned that the people were interested in the fish, but with crackers. Maybe we ought to be marketing crackers with the fish; we could maybe sell more fish.

    Mr. Eric Wickham: Exactly.

    The Chair: Mr. Wickham, you indicated in answer to a question from Mr. Stoffer that you hadn't communicated in writing your concerns to various organizations--I think that was what you said--but you had called and asked for meetings and things of that nature. This is just a piece of advice. I would encourage you to put everything in writing and to send copies to as many people as you can, including us, just so you document your concerns in advance. You never know when litigation might come out of this, and it's very nice to have documented in advance where warnings were made. Then you can attempt to prove negligence in failing to look after the stocks. So I would urge you to put everything in writing. Write to the minister, the aquaculture industry, and everybody else you can think of--since you're an author, that shouldn't be too difficult--and send copies to us as well.

    As soon as you leave, we're going to have a discussion here about some of the items we have heard about over the last two and a half to three weeks, and we'll decide what action we're going to take. Just so you know, one of the main preoccupations up here at the present time is when a federal election will be called, and if a federal election is called soon, it's obviously going to put a lot of things on hold until that election is decided, so you'll simply have to be patient in that regard, like everybody else. Should it transpire that there isn't a federal election, the committee business will continue as usual, and we'll be in touch.

    We do thank you for your evidence. I think it was clear, direct, obvious, common-sense, and I'm sure the committee will have some discussions about it this afternoon. Thank you very much, sir.

    Mr. Eric Wickham: Thank you.

    I was negligent in not getting my literature here early enough to get it all translated in time, but I have it all here and I'll leave it here in English. It will be translated and passed out to you, I understand, in a few days.

    The Chair: Yes, that's correct. Thank you very much.

    We'll suspend for just a few minutes to get a coffee and go in camera.