An expanded wharf, increased tuna output, boat replacements and a new blast freezer are part of fisheries company Frabelle’s development plans. But reducing costs is also important, as Frabelle’s Melinda Ragudos, General Manager for Cannery Operations, tells Business Advantage PNG.

Papua New Guinea tuna processing.

By the end of 2017, an expanded wharf at the Port of Lae will allow three boats to unload at a time—a 50 per cent increase on the current wharf capacity, according to Frabelle’s Melinda Ragudos.

Earlier this year, Frabelle opened a new tuna processing line, allowing the company to increase production to 100 metric tonnes of tuna per day, up from 70 metric tonnes. Its total staff now is just under 2000, working two shifts.

Frabelle is one of four canneries in Lae. The others are Majestic, IFC and Nambawan.

Majestic Seafoods, a joint venture with Thai Union of Thailand, Century Canning of Philippines and Frabelle PNG, began four years ago with a new tuna processing plant in Malahang, Lae. It continues to flourish, says Ragudos.

‘Frabelle also produces raw-packed canned tuna exclusively for the French market.’

Both Frabelle PNG Ltd and Majestic Seafood Cannery export canned tuna and frozen cooked tuna loins to the European Union, with which PNG has a market access agreement. Frabelle PNG also sells into the local PNG market under the Isabella brand.

Major improvements

During 2017, Frabelle made major improvements to its fish sorting conveyor systems and biomass boiler. It expanded its receiving and production, installing new packing systems and a fish oil extractor, and putting in a freezer that has doubled the output of frozen cooked loins. It also has a new 500-tonne cold room.

‘All our cartons are imported and this uses up precious foreign currency.’

Aside from the pre-cooked production line, Frabelle produces raw-packed canned tuna exclusively for the French market and it is about to launch a new line of raw tuna for the European Market.

Packaging advances

Some of Frabelle’s consumer products.

Improvements scheduled for 2018 include the use of aluminium foil packs instead of cans. The company will look to source packaging materials from within PNG, says Ragudos.

‘At the moment, all our cartons are imported and this uses up precious foreign currency. We are talking with local suppliers to have them provide our packaging needs and we’re hoping we can begin that in 2018.’

Onshore processing

A report from the National Fisheries Authority estimated that less than 25 per cent of fish caught in PNG waters is processed in PNG.

Earlier this year, the PNG Government announced it would end discounting on the sale of vessel days and licenses for vessels associated with PNG processors in 2018.

Prime Minister Peter O’Neill said a new system will see rebates only given to companies for fish that is processed in PNG, suggesting it would generate an additional 16,000 jobs in Lae, Wewak, and Madang, and would add value to the processing industry.

Ragudos remains sceptical that the rebate system being proposed will encourage fishing companies to deliver their catch to the local processors.

She says it will not motivate existing processors to increase their capacity and will not attract new direct foreign investment.

‘We fear that this will lead to the downfall of the domestic tuna purse seine and processing industry—similar to the PNG pole and line and PNG long line industry.’

Ragudos says Frabelle was concerned because it meant the company would have to negotiate terms and conditions of its operations each year.

‘We were never consulted on what we needed to enable us to process more.

Foreign investment

‘The processing industry in Lae is still young and we would like to think that the progress of development is going well, based on the number of major players that have and are supposed to be locating to PNG—despite all the difficulties we faced in our operations and the competition with other processors in the EU market, which to date is the only market for PNG-processed tuna.

‘We believe that in time PNG will become a major tuna hub, but the industry needs massive investments from major world players and continuing local small-scale investments in support industries.’