Ads by Google Ads by Google

UPDATE: Samoa Tuna Processors suspending canning

Other facets of STP being maintained — with much reduced labor force
fili@samoanews.com

“Due to adverse business conditions,” Tri Marine International says it will “indefinitely suspend” canning operations on Dec. 11 at Samoa Tuna Processors (STP) facility, which was opened in January 2015 following a $70 million investment with plans to hire up to 1,500 workers once the facility was in full operation.

On Wednesday morning, Tri Marine chief operation officer Joe Hamby met with Gov. Lolo Matalasi Moliga about the company’s plan. “Mr. Hamby disclosed actions being considered by STP which include closure of [its] canning operation but maintaining the other facets of its operation,” Iulogologo told Samoa News yesterday morning.

Tri Marine Group chief executive officer Renato Curto said it was “an incredibly difficult decision” to suspend the STP canning operation, and it was made “with a great deal of reluctance.”

“Our hearts go out to STP’s employees, suppliers, service providers and everyone else who depends on STP’s operations,” Curto said in a company news release.

Responding to Samoa News questions Tri Marine spokesperson Heidi Happonen said STP currently employs about 800 workers.

“It is difficult to say at this time how many will remain with the facility as it is operated as a logistics hub,” she said yesterday morning “Employees have been told about the news so that they have a full 60 days notice in hopes that it will give them enough time to find new jobs.”

Tri Marine says the challenging economics of canning tuna in American Samoa combined with external factors facing STP make Tri Marine’s private-label focused business model for operating the plant economically unsustainable in today’s market.

It also says that Tri Marine is currently evaluating alternatives for the facility including outright sale, preferably to a strategic buyer that would minimize job losses.

Although canning operations will be suspended, Tri Marine will continue to operate STP as a logistics hub for the Tri Marine Group. What this means is there will be a much reduced labor force, Curto said.

“Our focus at this time is to ease this transition for our employees and to readjust so we can continue to deliver the same high-quality product our customers expect from us,” he said.

Asked how the suspension of the cannery operation will impact Tri Marine’s locally based US flagged purse seiners (the Cape Fleet) Happonen said, Tri Marine plans to continue operating its fleet based in American Samoa and other contracted vessels operating in the territory.

With the reduced production of canned and pouch tuna with only one large scale cannery in operation, StarKist Samoa, “surplus fish arriving in Pago Pago that exceed the production requirements at the remaining cannery will have to be exported,” she said.

“Tri Marine will assist the Cape Fleet and other locally based vessels by allowing a prompt unloading at the STP dock whenever StarKist is unable to buy their fish and receive them upon arrival,” she added.

Curto had said last December that the company invested well over $200 million in American Samoa between its fleet and facilities.

Before the current announcement, Samoa News learned two weeks ago, that STP had scaled down production to just one-shift and that the frozen fish export business had been on hold for many weeks.

Samoa News understands that the StarKist Co., corporate office in Pittsburgh was informed Wednesday by Tri Marine of it’s plans for STP. Several employees had left StarKist Samoa to work at STP, including a former senior StarKist Samoa official.

“We have no comments at this time,” said StarKist spokesperson Michelle Faist when asked for reaction to Tri Marine’s announcement. She also had no comments as to whether StarKist Samoa will hire any employees laid off from the STP cannery.

StarKist Samoa is closed this whole week due to a shortage of fish supply and production is scheduled to resume next week Monday.

GOVERNOR’S REACTION

During the meeting Wednesday, the governor was informed by Hamby that the “global unfavorable economic environment for the fishing industry and changing dynamics of its business prompted the decision to stop its current financial hemorrhaging,” according to a statement from the Governor’s Office.

“While this decision by STP has a devastating social and financial impact on American Samoa and the lives of its people, business exists to make money and to earn the determined rate of return on investment so I know that this decision was not made lightly and I do appreciate the courtesy extended to the government by informing us on this decision,” Lolo said yesterday (Thursday).

He said the territorial government will continue to stand firm on its commitment to do everything possible to assist STP address its current challenges. Lolo said he has assured Hamby of the local government’s efforts to assist STP to qualify for any tax benefits available under the federal 30A Tax Credit Incentive — currently only StarKist qualifies.

“The possibility of selling its operation to another company reflects options being explored by Tri Marine,” the governor said.

According to the Governor’s Office, Hamby also informed the governor that Tri Marine is exploring different options relatively to its tuna-canning element of its overall operations in American Samoa. On the issue of the number of employees to be affected, Hamby said this particular issue is being discussed with local management staff.

CONGRESSWOMAN AMATA’S REACTION

“Due to a complex series of factors, including a long history of poorly thought out and misguided government policies, we find ourselves at a crossroads,” Congresswoman Aumua Amata said in a statement yesterday about STP. “It was my top priority during my first term in Congress to begin reversing those policies, and I will continue that mission in the hopes that the island’s remaining cannery can prosper.”

She pointed out that American Samoa has a rich history and cultural heritage of strength and perseverance “and we will continue to march on.” Additionally, the negative impact of the cannery closing to the local economy will be far from negligible.

However, “we’ve weathered worse storms and have come out of it with a better understanding of what it takes to keep moving forward. This situation is a setback but also an opportunity to look ahead and build something better from the ground up,” she said. “We can pull together and work on diversifying our economy and implementing new ways to grow.”

“We can continue to implement better infrastructure and economic policies so that future hurdles are more like small speed bumps instead of large mountains. Be assured, we will do everything we can to minimize the impact of this closing on our community and keep American Samoa’s economy healthy and growing,” Amata said.

CONGRESSIONAL COMMENTS

The Congresswoman held a teleconference meeting Wednesday night with three top House Republican leaders about STP.  The top leaders issued brief statements, through the Congresswoman’s office.

House Natural Resources Committee chairman Rep. Rob Bishop said that as a subcommittee vice chairman, “Amata has been a strong voice on the Natural Resources Committee in making sure the voices of the people are taken into account in federal decision making.”

Bishop said he was “distressed” to learn that STP will close indefinitely, “throwing hundreds of people out of work.”

“I am committed to enacting legislation to reduce the power of the president to unilaterally wall off large sections of the ocean in the name of environmental protection without consultation with Congress and the local people affected,” he said.

Subcommittee on Insular, Indian and Alaska Native Affairs chairman Rep. Don Young added, "Next year, with Amata as vice chairman of the House Natural Resources Subcommittee on Insular, Indian and Alaska Native Affairs, we will bring to the new administration's attention the importance of economic diversification on the islands.”

“The tuna cannery's closure should serve as a wake-up call for us to address the potential economic impacts should other industries face a similar fate,” he said.

House Small Business Committee chairman, Rep. Steve Chabot said, “I was sorry to learn that American Samoa's second largest private employer is suspending operations. As a valuable member of my leadership team on the House Small Business Committee, Amata will have a seat at the table when we consider our committee agenda next year.”

“We will look forward to exploring how we in Washington can help to develop the territory's small business economy to protect the workforce from dislocations like this in the future,” he said.

[Samoa News should point out that national congressional elections are set to take place with the US presidential election  — on the same day, Nov. 8th. Who will lead committees and subcommittees, will depend largely on which political party — Republican or Democrat — will have the majority in Congress, although seniority (how many years you have served in the Congress) does also play a part in such selections. Republicans currently hold the majority in both chambers, House of Representatives and Senate.