COD WAR: THE MEN BEHIND THE WAR

Winning the 'cod war' is supposed to be in the interests of the nation. We read about our boats' fighting for free. dom against the nasty Icelanders.

But freedom for whom? All the housewife knows about fish is that it costs more. Is the war for her, or for the handful of firms which control the industry from sea to table? The answer is that the battle is fought strictly in the interests of the latter.

Monopoly is the driving force behind the war on the British side.

Once trawling was controlled by scores of small family firms who ran the ships in a direct and ruthless fashion.

Now the fleets are dominated by three firms. One, British United Trawlers (born of a 1969 merger of the two giants Associated Fisheries and the Ross Group), is far larger than its nearest rivals, Marrs and Boston Deep Sea Fisheries.

Concentration is extremely high. Just after the war the fleet in Hull was controlled by about 20 owners. Now there are six, dominated by the big three.

In 1962 three owners with over 50 vessels each, controlled 41 per cent of the fleet. By 1971 two owners had 45 per cen. and four 73 per cent.

In addition to BUT and BDSF there is MacFisheries (Unilevers) who do not run distance trawlers but nevertheless buy up to 20 per cent of all cod landings.

These are the firms which send most of the men out to fight the cod war. BDSF owns the United Towing Company, which hires out sturdy tugs to help guard the British trawling fleet off Iceland. The government pays the bill— £1,500 per tug per day.

Monopoly in the industry is not an accident. It is due to the laws of capitalist production as they affect trawling. In part, it has been caused by the very antagonisms between the big nations that have the cod war itself.

Yesterday's article showed how, as the North Sea fish stocks became depleted through overfishing, trawlers were forced further north to seek their catch.

These journeys were more expensive, oil costs were high, fishing time was limited by the length of the journey. For a satisfactory performance, new, bigger boats had to be built immediately after the war.

These pressures marked the beginning of the antagonism with Iceland and increased the pressure for monopoly. The family firms simply could not stand the strain of the huge outlay of capital to start and maintain a healthy distantwater fleet.

H. Wight, chairman of the management committee of the Distant Water Vessel Development Scheme, remarked on the effects of deep-sea fishing in August 1950, when he told trawler owners:

'A much greater return is now needed to make a trip pay on long-distance voyages and for some time many distant-water trawler-owners in both Hull and Grimsby have been operating their vessels at a considerable loss.' The problems now are even more severe. Vessels have been forced to travel up to 5,000 miles to Newfoundland to search for fish. The costs are crippling and beyond all bar the largest companies which have the capital to invest in ships that can stay at sea for a third of a year.

According to Jack Alison, president of the Hull Fish Merchants Protection Society: "The Hull fleet of conventional trawlers [side-trawlers which make average sea trips of three weeks] is steadily contracting because the cost of replacement has risen to astronomical heights. Future investment in this field becomes an economic gamble which very few owners are prepared even to contemplate.' But perhaps an even greater factor has been the revolution in the techniques of processing.

e fast disappearing from the industry. They have not got the range st le re al it struggling to maintain margins against increasing costs largely a direct result of the investment programme. As the White Fish Authority report for 1967 stated: 'Increased revenue in some sections was offset by a massive increase in operating costs.' All this took place against a background of ruthless competition on the high seas against the freezer-fleets of other nations and the depletion of fishing grounds in the northeast Atlantic.

Total effect once more was to reinforce the drive towards greater and greater control of the whole industry by a handful of firms.

'Altogether,' stated the White Fish Authority in 1969-1970, 'the ageing of fleets, the rapidlyrising cost of new construction and I the imminent shortage of cod in the north-east Atlantic make it doubtful that British production can be maintained at current levels, despite the increasing contribution from the prosperous and efficient inshore fleet.' Greater concentration and the wave of investment also radically altered the shape of the fish market.

The primary aim of the trawler-owners is not necessarily big catches. If the market is glutted prices can drop —in the past it was not unknown for tons of fish to be dumped because they failed to realize prices that allowed the owners their profit.

Owners like high stable prices, but these were not guaranteed when a large numFor the capacity of the ber of trawling companies faced hundreds of merchants at each fish port who bought the catch by auction. In these circumstances — especially in the absence of any storage facilities to eradicate gluts and shortages — prices fluctuated violently.

The owners attempted to protect themselves by 'controlling' the catch. When prices in the industry slumped, during the mid-1950s, for example, the Hull Fishing Vessel Owners' Association agreed to confine 20 per cent of the fleet in dock and levy penalty payments on trawlers which returned from the grounds more than 70 per cent full.

These restrictions were designed entirely to preserve profit margins (or as was the case in Hull to reduce losses) and not aimed at getting more cheap fish to the public.

The need for more control became more urgent when the heavy investment programme began.

The massive burden of capital expenditure meant poor prices would be doubly disastrous for the companies, because they had far more to lose. They were forced to thrust forward into the market, to control the price of fish and go even further to secure retail outlets.

The upshot has been the demise of the smaller merchants at the fish docks, who were rapidly side-tracked by the giants. Those that remain are either owned by the companies or are their economic slaves.

freezer vessels By 1965, of Grimsby's 600 merchants, five firms, all of which were associated or controlled by the trawler companies, handled 25 per cent of the catch. Unilever (MacFisheries) handled a further 10 per cent.

In Hull, with 200 merchants, 37 per cent of the catch was bought by six firms which were largely controlled by the trawling interests-Unilever took a further 13 per cent of the Hull landings off the market.

The decline of the merchants has continued. Today there are about 130 in Hull and a further fall in numbers is predicted by the Hull Fish Merchants' Protection Society.

To consolidate their hold, the largest companies, Ross and Associated Fisheries, formed a ring in Hull to keep up the prices at the auction. The larger merchants controlled or influenced by the big two would bid price by agreement and the smaller merchant would have to enter auction at above market prices if they wanted to get any decent stocks at all.

Ross and Associated reached their agreement in 1959-the dawn of the freezer revolution. By 1964 sales of frozen fish had reached £100m and the two companies were automatically withdrawing the bulk of the catch at 3s above the market price exclusively for their own use-despite protests from the Merchants' Protection Society (they later took the logical step of proposing a merger. This failed in the mid-1960s, but was successful fish from the stern.

in 1969 when they formed British United Trawlers).

The owners argued the practice was a good one because it provided good quality fish and a stable climate in the industry in which investment and modernization could flourish.

The quality argument was dubious, Inshore and middle water purchases were not subject to such agreements and the quality of these was generally recognized to be higher.

The argument for stability may well be technically correct. But the development takes place within the context of private monopoly. Benefits, therefore, are not passed on to the housewife who buys the fish or the men who catch them, but the few who own the boats. The mergers and cartels are designed to protect their margins.

For the big boys, trawling is now a profitable business.

Associated Fisheries (74 per cent of BUT) made £1.7m in 1971 an increase of 27 per cent over the year. In 1972 tha pre-tax profit hit the record level of £2.2m. In April 1973 new figures showed yet another record.

But the companies are still plagued with a relatively small rate of return (e.g. Associated 5 per cent). This is because of the increasingly high organic composition of their capital referred to above.

The biggest owners have attempted to overcome this tendency by merger and control of the market, but they are unable to escape what is a law Friday June of capitalist development.

What are the social and political implications of these developments?

They have led to a higher price for fish and a reduction in the choice of ish avallable. Owners like large and constant catches of cod for freezing.

For the men in the industry it has meant pressure to catch fish and compete with international and national rivals. The skippers now are in the midst of a battle with the owners who want them to sign contracts in anticipation of the demise of the side-trawler and redundancies in the industry.

But above all monopoly has had a direct influence on the cod war. The journeys to Iceland and the northern Atlantic gave an impetus to monopoly. But monopoly now fuels the flames of the antagonism on the seas. Owners have sunk millions in their fleets, they are expensive to maintain—a ban on Icelandic fishing would be disastrous for their profits. Hence the pressure is on to fish and keep on fishing.

The cod war is the owners' war, though they like other people to fight it.

One question remains to be answered, however, and it is asked by every deckie and skipper in Hull.

If the Icelandic waters are lost and Britain is forced off the continental shelf-what happens to the thousands of jobs in distant-water fishing?

In the final article on Monday we examine this issue. Tomorrow we investigate the NATO aspect of the cod war.

Press, Friday June 8, 1973