Sector profile: Fisheries


Fisheries has emerged as one of Papua New Guinea’s most dynamic sectors, following a wave of investment from Asia. In this special feature, Samantha Magick speaks with some of the sector’s key players about its current state and the prospects for further expansion.

Fish processing is a growing industry in PNG, especially along the country’s northern coast.

In 2010, PNG supplied about 17% of the world’s tuna catch, a figure that has been steadily rising in recent years. The Bank of PNG reports that the value of marine products exported in 2011 was 151.1 million kina (US$73.7 million).

This 32.5% increase on 2010 exports was fueled by bigger catches and higher market prices. Frozen tuna makes up about half of PNG’s tuna exports, followed by canned tuna, cooked loins, fishmeal and chilled tuna. The Managing Director of R D Tuna, Pete Celso, says the raw value of PNG’s tuna catch per annum is about US$1.35 billion, but that this figure could more than double to US$2.7 billion with more value-added processing.

Markets diversifying

The main markets for PNG tuna are Thailand, the Philippines, American Samoa and Japan for frozen tuna; and the European Union (EU) for canned tuna and cooked loins. Chilled tuna goes to Japan, and fish meal goes mainly to Australia, Sri Lanka and Japan. PNG canned tuna can enter the EU market quota- and duty-free.

Imports to the EU were 15,600 tonnes in 2010, with that amount expected to double in 2012. A recent European Commission report confirmed the importance of this duty-free provision to the PNG sector: ‘Over the medium–longer term, global sourcing will play an increasingly important role in the development and survival of PNG’s tuna processing industry. Duty-free market access to the EU, coupled with global sourcing, makes onshore investment in PNG a more attractive prospect.’

At the time of writing, negotiations with the United States over the US–Pacific Islands Multilateral Tuna Fisheries Treaty were continuing, with a gap to be bridged over the number of fishing days per season on offer, and the fee to be paid for those days. The treaty governs US access to fisheries in a number of Pacific Island exclusive economic zones. PNG has been playing a leading role in the negotiations, also lobbying for duty-free access to the US market for its canned tuna and other tuna products.

China, currently the fourth largest importer of fish in the world, is also emerging as an important potential market. Director of the International Cooperation Department of People’s Republic of China Fisheries Bureau, Xiaobing Liu, says it could open up its vast market to Pacific Islands. ‘China is one of the major fisheries countries, with the greatest number of fishing vessels and fishers in the world, while PNA [Parties to the Nauru Agreement] countries have the largest fishing ground of tuna in the world,’ says Liu. ‘There is a great potential opportunity to cooperate between two sides.

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New investments and expansion

Much of the new investment in fisheries has been in anticipation of the Pacific Marine Industrial Zone (PMIZ). But there is also significant investment activity in Lae, at the Malahang Industrial Centre, where Thai Union of Thailand, Century Canning of the Philippines, and Frabelle have set up a joint venture, Majestic Seafood Limited. Their US$25 million plant will process 350 tonnes per day. About 80% of its canned tuna will be exported to the European Union and the remainder sent to the United States, Japan and other markets. Plant construction was almost complete at the time of writing.

Frabelle is building a new vessel to supply Majestic. The National Fisheries Authority (NFA) has issued four fishing licences to supply the plant during its initial phase, and a further six licences are likely to be issued when production increases. All will be PNG-flagged.

Expanding canning operations

Frabelle has also expanded its cannery operations, according to General Manager-Cannery, Rainer Agbunag. Frabelle has invested US$2 million in plant equipment that now enables it to raw pack fish, and then cook it in the cans, rather than cooking it twice—before and after canning—as was previously the case.

‘This has increased our capacity by 20 metric tonnes. The quality will improve in terms of flavor retention versus the other process of pre-cooking,’ Agbunag says. Frabelle exports most of its canned output to Europe, but Agbunag says there is still room for growth in the domestic market.

The PNG Government has also signed an agreement with Nambawan Seafoods to establish a tuna processing plant in Lae. Nambawan Seafoods Tuna is a joint venture between Trans Pacific Journey Fishing Corporation and TSP Mariner Industries of the Philippines. It aims to process 150 metric tonnes of tuna per day at its tuna loining and canning plant.

A Chinese company, the Zhejiang Zhenyang Group, has also signalled its desire to set up a US$25 million tuna processing plant. The proposal follows Chinese Government support for the sector, in financing infrastructure for the PMIZ and funding a frozen tuna processing facility in Lae. The plan will process 250 metric tonnes to 300 metric tonnes of tuna a day and employ some 3000 local workers.

NFA Managing Director, Sylvester Pokajam, says Lae is also attracting interest from Korean and Chinese investors. The Asian Development Bank is funding Lae’s port expansion but Pokajam says there is still a problem meeting demand there: ‘We are thinking of building another fisheries wharf in Lae which is just a few kilometres away from the Malahang Industrial Centre. We are still talking to the various governments of Korea, China and Japan, hopefully we will get one of them to come good with that.’

Incentives for fisheries

The PNG Government offers a number of incentives to investorsin the fishing sector. Expenditure on new plant or articles for commercial fishing activities qualifies for a 100% accelerated depreciation deduction. Profits from the export sale of canned, loined and smoked fish are exempt from company income tax for the first three years of export and additional concessions apply for a further four years. Investors may also qualify for double deductions for export market development costs and staff training.

Sustainability and traceability

PNG is increasingly gaining a reputation for sustainable fisheries. ‘We will do everything possible, under the sun, under the moon to make sure that this industry remains sustainable and we will tightly control fishing in PNG waters,’ says Pokajam.

‘We will do everything possible, under the sun, under the moon to make sure that this industry remains sustainable’

‘It’s all now about sustainability and traceability’ says R D Tuna’s Pete Celso. R D Tuna is PNG’s largest canning company, and is being considered for accreditation under the Marine Stewardship Council’s sustainability and traceability policies. ‘PNG has undergone major improvements and capabilities that can probably be considered the best so far in the Pacific region,’ he says.

In July 2011, the Marine Stewardship Council (MSC) awarded the PNA countries, including PNG, a certificate of approval for catching tuna in free schools, rather than using fish-aggregating devices (FADs). This means 30% of skipjack caught in the PNA fishery, and 16% of the skipjack caught in the Western and Central Pacific Fisheries Convention area, can display the MSC eco-label.

‘With MSC certification of the PNA’s free-school skipjack operations, our customers can be confident that the free-school tuna caught in our waters meet the highest standards for well-managed and sustainable fisheries,’ said the PNA’s Director, Dr Transform Aqorau. Meanwhile, Fair Well Investment, a Port Moresby-based fishing company, has signed an agreement with the National Fisheries Authority and World Wildlife Fund to trial the use of circle hooks in its long-line fishing operations.

Coastal and small-scale fishing

The PNG Government has also put renewed emphasis on coastal and smaller-scale fishing. PNG’s coastal fishing industry focuses on prawns, lobsters, barramundi, beche-de-mer, trochus shells, pearl shell and green snail. Some trout and carp farms are located in the Highlands region.

The National Fisheries Authority (NFA) has recently deployed an Inshore Fishing Aggregating Device (IFAD) program in East Sepik province, with a view to introducing it in other maritime and Highlands provinces. ‘We feel IFAD will help ease the pressure that is currently being exercised on the reef system,’ says the NFA’s Pokajam.

First published in Made in PNG 2012


  1. Anura Weerasekera says

    wish to be a business partner. We deal in Fish meal in Sri Lanka.

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