Marshall Islands Correspondent

For the five years preceding 2020, Majuro was the busiest tuna transshipment port in the world. COVID-19 caused a 60% decline in transshipments in 2020.

Photo by Giff Johnson

MAJURO, Marshall Islands — The Marshall Islands experienced first-hand how the COVID-19 pandemic and the border restrictions it generated caused the demise of a once world-leading tuna transshipment operation.

On the flip side, outer islanders set an all-time production record in 2020, thanks to the ongoing incentive of a subsidized buying price.

These were the two major economic dynamics for the Marshall Islands in 2020.

Copra, a domestically controlled industry unaffected by COVID, could set a record in a year of global economic devastation. But with fisheries revenue expected to decline by 15% to 20% for 2020 and 2021, it remains to be seen if the government can maintain for the long-term the subsidized 60c per pound price paid for copra — an amount that was bumped up in December from the 50c per pound paid since 2016.

Fisheries data for Majuro in 2020 show the negative impact of the global pandemic on one of the primary economic revenue generators for the country.

Majuro closed out 2020 with 180 tuna transshipments — a far cry from the heavy usage of port Majuro the past few years as a center of purse seine transshipment activity.

Since the mid-2010s, Majuro has turned into the world’s busiest tuna transshipment port. For the five years from 2015 to 2019, Majuro averaged 466 transshipments annually. All five years had more than 400 transshipments and two — 2015 and 2016 — had more than 500.

But COVID tossed a monkey wrench into the picture, ending Majuro’s global transshipment dominance temporarily. Some observers worry that without proactive measures to encourage transshipment activity, the current trend could become permanent as purse seiners and their carrier vessels choose other ports with fewer COVID restrictions.

Fisheries Director Glen Joseph said he expects fisheries revenue to be down 15% to 20% in 2020-2021, in part because of the downturn in transshipment activity. He expressed concern in mid-January about the need to relax restrictions for entry in line with the experience of port and other officials in implementing COVID-prevention protocols and the ban on human-to-human contact with vessels.

Workers inside the coconut processing factory in Majuro open hundreds of bags filled with copra inside the mill warehouse.

Photo by Bolten Elanzo

The primary issues are the 14-day quarantine period before fishing vessels are allowed into the lagoon to transship their catches, even though the crew are banned from going ashore, and a slow government agency process to approve exemptions to the 14-day quarantine.

The Marshall Islands Marine Resources Authority reports that there were 19 transshipments in December, slightly above the monthly average of 15 for the year. This low monthly average represents a decline of more than 60% from the annual average of the past five years, all of it related to the border controls and COVID entry restrictions.

The 180 transshipments that did occur in 2020 accounted for more than 127,000 metric tons of tuna moving through Majuro during 2020 — tuna valued at more than $190 million at $1,500 per ton. Like the actual number of transshipments, the volume of tuna handled in Majuro was down nearly two-thirds compared to 2019. In 2019, 362,454 metric tons of tuna was moved from purse seiners to carrier vessels in Majuro for onward transport to fish processing facilities in different parts of the world.

In 2020, according to preliminary estimates, only 127,630 metric tons was handled in Majuro.

In 2019, MIMRA netted $538,000 from transshipment — a 60% decline in transshipment activity in 2020 will reduce that amount by about $300,000.

While the $538,000 from 2019 in itself is not a truly large amount of money, there are numerous other spinoff benefits: Many local wholesale and retail stores supply the vessels and their crew with food, supplies and equipment. The Marshalls Energy Co. refuels some of the vessels that use Majuro and has seen its fuel sale revenue plummet since early last year because of the smaller number of fishing boats visiting. Local businesses sell large quantities of salt (used in the fish freezing process) to purse seiners. Pacific International Inc. provides net repair and other services to visiting vessels — but last year, it had only three fishnet repairs compared to 20 performed the previous year. These are all goods and services that put money into the local economy and employ dozens, maybe hundreds of people.

On land, copra makers set an all-time record for production in 2020 and earned themselves nearly $9 million in the process, an unprecedented amount of cash going into the hands of islanders living on remote islands outside of the two urban centers of Majuro and Ebeye.

The year was so good that the January-December total broke the previous record set in 1970 of 7,348 tons by more than 1,000 tons. The 12-month calendar year record is now 8,627.51 tons, according to a report in late January issued by the Tobolar Copra Processing Authority in Majuro.

With the government paying 50c per pound for the first 11 months of 2020 and boosting the price to 60c per pound in December, copra maker earned $8,863,250 in 2020.

All four quarters during last year were strong, with the January-March period was the best three months of the year with 2,466.45 tons collected from outer islands for milling in Majuro. “Production” in the Marshall Islands revolves largely around shipping availability. If government field trip ships are active, picking up copra regularly, production goes up because the dried coconut meat gets brought to Majuro where it is weighed and milled by the Tobolar Copra Processing Authority.

The top five producing atolls in 2020 were: Ailinglaplap 1,696.29 tons, Arno 1,314.12 tons, Mili 769.85 tons, Ebon 551.37 tons and Maloelap 526.83. mbj