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Lease quota fishing in a changing rock lobster industry

Author

Listed:
  • van Putten, Ingrid
  • Gardner, Caleb

Abstract

The Tasmanian rock lobster industry has been managed by Individually Transferable Quotas (ITQs) and several input control measures since 1998. In this study, nine years of rock lobster fishing business data were used to categorise the catch and quota ownership traits and examine the response to the introduction of ITQ management. More specifically the study investigates how profit drivers moderated industry structure change. Owners who are not active fishers (investors) have steadily grown in number with a commensurate expansion of the lease quota market. A cap on the maximum allowed number of quota units per legal entity of 200 units (around 2% of the total) was implemented at the start of ITQ management and this has proven effective in the maintenance of diverse ownership with little processor control. Active fishers who lease in quota (lease dependent fishers) took a large proportion of the total catch in 2007. An economic pressure to expand lease operations was identified, which accrued through better utilisation of capital. The pressure to increase in size through leasing in quota exists for businesses with small holdings. In contrast, as ownership of quota increased to approximately 30 units, the marginal profitability of fishers increased through the opposite process, that is, reducing fishing activity and supplementing income by leasing out quota. Income supplementing appears to be a transitional state, and in time these quota owners will move to the more stable state of "investor". Thus the fishery is trending towards a smaller number of highly active lease fishers with units supplied by a broad group of investors. Lease fishers need to move into the large-scale category catching at least 75 units to achieve a normal economic profit and remain viable in the long run. However, they face barriers to entry to this large catch category through high upfront capital investment costs. Other potential issues for management that arise are that their higher financial stress increases compliance risk and their lack of investment in quota assets reduces incentive for stewardship of the resource.

Suggested Citation

  • van Putten, Ingrid & Gardner, Caleb, 2010. "Lease quota fishing in a changing rock lobster industry," Marine Policy, Elsevier, vol. 34(5), pages 859-867, September.
    • Handle: RePEc:eee:marpol:v:34:y:2010:i:5:p:859-867
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    Citations

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    Cited by:

    1. Thébaud, Olivier & Innes, James & Norman-López, Ana & Slade, Stephanie & Cameron, Darren & Cannard, Toni & Tickell, Sharon & Kung, John & Kerrigan, Brigid & Williams, Lew & Richard Little, L., 2014. "Micro-economic drivers of profitability in an ITQ-managed fishery: An analysis of the Queensland Coral Reef Fin-Fish Fishery," Marine Policy, Elsevier, vol. 43(C), pages 200-207.
    2. Juan J. Agar & Jessica A. Stephen & Andy Strelcheck & Assane Diagne, 2014. "The Gulf of Mexico Red Snapper IFQ Program: The First Five Years," Marine Resource Economics, University of Chicago Press, vol. 29(2), pages 177-198.
    3. Oostdijk, Maartje & Santos, Maria J. & Agnarsson, Sveinn & Woods, Pamela J., 2019. "Structure and evolution of cod quota market networks in Iceland over times of financial volatility," Ecological Economics, Elsevier, vol. 159(C), pages 279-290.
    4. Ingrid van Putten & Emmanuelle Quillérou & Olivier Guyader, 2012. "How constrained? Entry into the French Atlantic fishery through second-hand vessel purchase," Post-Print hal-00815455, HAL.
    5. Pinkerton, Evelyn, 2015. "The role of moral economy in two British Columbia fisheries: Confronting neoliberal policies," Marine Policy, Elsevier, vol. 61(C), pages 410-419.

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