Mark Coulthurst’s Banker

That Mark Coulthurst had a banker — a marine manager for Pete’s sake — would likely have struck the rumor-mongers in Craig, Alaska, as downright peculiar if not outright suspicious. They’d have a point. As a general rule, bankers weren’t that keen on commercial fishermen.

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Mark Coulthurst (courtesy Laurie Coulthurst Hart)

“The loan industry, in general,” quipped Barry Bevis, West Coast marine manager for Seafirst Commercial Corp., “isn’t exactly bullish on fish boats.”

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Barry Bevis, West Coast marine manager, Seafirst Bank (Doug McNair)

On its best days, it was a risky business. “Even a highliner who’s found a great boat at a good price can have a hard time getting financing these days if he doesn’t have a good financial/business plan and do a good job of representing it in a loan proposal. You can catch more fish than anybody on the whole damn ocean and still be a lousy businessman and a poor risk. I’ve seen it happen to some pretty top fishermen,” noted Bevis.

And then there were all the other days.

In 1982, the Alaska salmon industry conducted 9 recalls of 7 3/4-oz cans of salmon after a can of Alaskan salmon was implicated in illness and one death in Belgium from botulism toxin. The Seattle District FDA traced it to a specific salmon packer and requested that the firm recall its 1980 and 1981 production of salmon packaged in 7 3/4-oz cans. As additional firms were identified as having used the defective cans, subsequent recalls were initiated.

The recalls and warnings had a devastating effect on the canned salmon industry and a serious impact in Alaska, where the salmon industry was the state’s biggest employer. A botulism case in the U.S. confounded things further. Because it remained unresolved, the case frustrated the industry, according to Ron Jensen, an executive with the seafood division of Castle & Cooke, a large food producer. “It’s ruining the industry,” he said. “I wish it would be resolved one way or another.”

In fact, the industry was already trending away from canned-salmon.

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Canned vs Fresh Salmon catch, 1978-1982 (source: U.S. Dept of Interior, Proposed North Aleutian Basin Lease Sale, September 1985. Note that similar trends were found throughout Alaska).

From about 1977 on, the salmon runs began to increase in size, and a structural gap emerged as a result of both abundance of product and new technologies. Quick- or flash-freezing allowed increasing competition to move in, in the form of small operators who could make a handsome profit by shipping directly to remote U.S. locations, Europe, or Japan.

Until 1982, canned-salmon production remained fairly stable, while the total fresh and frozen product continued to increase. However, the disastrous losses caused by the 1981 botulism scare accelerated the shift away from canned salmon.

Mark Coulthurst’s diversification strategy put him in exactly the right position to respond — and his banker knew it. Because of his Angel Island Pacific Fishing venture, he had a close-up knowledge of marketing and was prepared to branch out if canneries went on limit. He’d always been willing to look at a new fishery but now was taking a much more careful look; several days spent in Juneau with fisheries biologists yielded a briefcase full of data and projections that would form the basis of a long-range fishing strategy.

Lastly, he’d picked a boat and equipment that could fill specific niches in a variety of fisheries. The Investor had the ability to compete in almost any fishery except Bering Sea king crabbing or high seas dragging. Mark ruled out nothing.

Said Mark’s banker, Barry Bevis of Seafirst Bank:

“When Mark came to us it was clear he’d looked at a lot of contingencies for his fishing production, had considered a lot of options. His ability to diversify in his markets and his realistic growth expectations were based on good, marketing homework.”

Mark Coulthurst: Doing the Bellingham Scramble, by Doug McNair.

And there it was. At the start of the 1982 salmon season, Mark Coulthurst had a loan on a brand-new, $750,000 purse seiner. Once he’d added gear, it was worth closer to $1 million. He was ready for almost anything.

Copyright Leland E. Hale (2018). All rights reserved.


Craig

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