ORANGE ROUGHY (ORH 1)

Figure 1. The ORH 1 QMA and the four sub-management areas defined for the ORH 1 AMP
(labelled A-D). Solid lines enclose the Mercury-Colville ‘box’.

1. The ORH 1 stock has been managed since 1 October 2001 under the Adaptive Management Programme (AMP), whereby the total allowable catch (TAC) was increased from 840 tonnes to 1 470 tonnes for a period of five years. A formal assessment of stock status and yield for ORH 1 was not available, and the TAC was increased under the AMP to provide incentives for industry to spread effort (and catch) across the large area, and simultaneously to obtain information from the fishery that would further our knowledge of stock size, geographical extent, and long-term sustainable yield.
   
2. Over the course of the AMP there have been concerns regarding industry governance, including sub-area and feature voluntary catch limits being exceeded, and observer coverage levels not being achieved. Recent investigations have also caused concerns about the reliability of catch and effort data collected under the AMP. The adequacy and reliability of catch and effort data is important for the ORH 1 AMP, as trends in catch per unit effort (CPUE) are the main tool for monitoring the fishery’s performance under the increased TAC.
   
3. The ORH 1 AMP is due to conclude on 30 September 2006. The TAC and other management controls for ORH 1 need to be reviewed and decisions made about ongoing management of the stock from 1 October 2006, having regard to the best available information. The Ministry of Fisheries (MFish) notes that it does not support an extension of the AMP for ORH 1 for a further two years (as is being proposed for other final-year AMPs), because of the characteristics of the fishery and lack of information at this time.
   
4. While the AMP has been partly successful in delivering information from a wide range of areas and features across the fishery, information to underpin an assessment of stock status and yield has not been obtained. The available information does not allow an evaluation of stock size in relation to the biomass that can produce the maximum sustainable yield (B _MSY), nor indicate the likely trend in stock size under the current TAC. Orange roughy is vulnerable to overfishing and the stock is slow to recover. Considering the uncertainty in the available information and the biological characteristics of the species, a cautious approach is appropriate when considering the level at which to set the TAC to better ensure that the obligations under s 13 are met and are in line with the information principles in s 10 of the Act.
   
5. MFish proposes three alternative options to manage the orange roughy fishery in ORH 1 upon expiry of the current AMP in order to set the TAC at a level that will maintain the stock at or above, or move it towards or above, the B _MSY level as required under s 13.
   
6. Option 1 proposes to retain both the AMP structure and the current TAC of 1470 tonnes for one year. This includes the current sub-area and feature limits, the additional reporting requirements, and further increases the scientific observer coverage to 100% of all trips for the fishery. Option 1 places most weight on utilisation and the existing management approach. It provides time for the available information to be audited, for further information to be collected, and another opportunity for industry to demonstrate that effective governance under the AMP can be achieved. Option 1 relies on the current voluntary measures under the AMP to spread effort and catch. Improved monitoring is provided by increasing observer coverage. Option 1 is proposed on the basis that the current TAC and catch spreading arrangements do not pose sustainability risks over the next year and that further evaluation of the fishery will be done in 2007.
   
7. Option 2 takes a more cautious approach on the basis that stock status is uncertain. This places greater emphasis on consideration of the biology of orange roughy, the problems with governance under the AMP, as well as concerns about the reliability of information from the AMP. Option 2 proposes that the AMP be withdrawn and the TAC reduced to its pre-AMP level of 840 tonnes. This option relies on industry implementing a structured fishing plan with voluntary catch spreading and reporting requirements to ensure sustainability and reduce risks of localised depletion. The sub-area limits would be reduced under the more cautious approach, but current feature limits retained. Scientific observer coverage would be increased to 100% of trips to improve monitoring.
   
8. Option 3 sets the TAC at a cautiously low level and is not reliant on voluntary spreading of effort and catch by industry. The option proposes to withdraw the AMP and reduce the TAC to a level that would ensure sustainability in the absence of fine-scale management of catch and effort. Scientific observers would need to cover all fishing in the Mercury-Colville ‘box’ to ensure the integrity of the orange roughy bycatch limit for the ‘box’.
   

Summary of Options

9. MFish proposes three management options that reflect different responses to the current situation in ORH 1. It is open to the Minister to choose other options (alternative TAC levels and management measures) that he might consider will best meet his sustainability and utilisation obligations under the Fisheries Act 1996 (the Act).
   
10. The options proposed by MFish are set out below.

Option 1

11. Retain the current AMP structure for ORH 1 for one further year, including a directed exploratory fishing survey in the Bay of Plenty, and:
    1. Retain the current total allowable catch (TAC) of 1 470 tonnes for the 2006–07 fishing year;
    2. Retain the 70 tonnes allowance for other sources of fishing-related mortality, and zero allowances for customary Mäori interests and recreational fishery interests;
    3. Retain the total allowable commercial catch (TACC) for ORH 1 at 1 400 tonnes;
    4. Retain the AMP structure with the following sub-area catch limits (to be implemented by industry) within the TACC
       1. Sub-area A limit of 200 tonnes; with a 100 tonnes annual feature limit;
       2. Sub-area B limit of 500 tonnes; with a 150 tonnes annual feature limit;
       3. Sub-area C limit of 500 tonnes; with a 150 tonnes annual feature limit;
       4. Sub-area D limit of 200 tonnes; with a 75 tonnes annual feature limit, except that at 30 tonnes by catch-only limit applies for ORH 1 in the Mercury-Colville ‘box’;
       5. Retain the unstandardised CPUE thresholds for feature limits;
    5. Increase observer coverage to 100% of all ORH 1 fishing trips and all fishing in the Mercury-Colville ‘box’;
    6. Request industry to submit a full analysis of AMP results in April 2007 to inform future management options.

Option 2

12. Withdraw the AMP for ORH 1, and:
    1. Reduce the TAC for ORH 1 for the 2006–07 fishing year to the pre-AMP level of 840 tonnes, and within that TAC;
       1. Set a 40 tonnes allowance for other sources of fishing-related mortality, and zero allowances for customary Mäori interests and recreational fishery interests
       2. Set the TACC for ORH 1 at 800 tonnes;
       3. Request industry to implement a structured fishing plan to spread catch and effort across four sub-areas of ORH 1, with sub-area catch limits of
          • Sub-area A reduced from 200 tonnes to 125 tonnes; with a 100 tonnes annual feature limit;
          • Sub-area B reduced from 500 tonnes to 275 tonnes; with a 150 tonnes annual feature limit;
          • Sub-area C reduced from 500 tonnes to 275 tonnes; with a 150 tonnes annual feature limit;
          • Sub-area D reduced from 200 tonnes to 125 tonnes; with a 75 tonnes annual feature limit;
          • Retain the ORH 1 bycatch-only limit for the Mercury-Colville ‘box’ at 30 tonnes;
          • Retain the unstandardised CPUE thresholds for feature limits from the current AMP;
       4. Propose 100% observer coverage of all ORH 1 fishing trips and all fishing in the Mercury-Colville ‘box’ .
          

Option 3

13. Withdraw the AMP and set the TAC at a level that provides greater certainty that the sustainability of the overall ORH 1 stock and any separate stocks within ORH 1 will not be at risk, and that risk of localised depletion will be reduced in the absence of fine-scale management of catch and effort. It would be necessary to retain the limit on ORH 1 bycatch from the Mercury-Colville ‘box’ at 30 tonnes under this option. All fishing in the ‘box’ will need to be observed in order to ensure the integrity of the bycatch limit.
    

Rationale for Management Options

Species characteristics

14. Orange roughy are widely distributed within New Zealand’s Exclusive Economic Zone and elsewhere, with a number of genetically distinct stocks. There are likely to be several distinct biological stocks within the area of ORH 1.
    
15. Orange roughy are very long lived with very low recruitment and are consequently vulnerable to over-fishing. Recovery from an over-fished state is recognised to take many decades. The biological characteristics of orange roughy mean that a more precautionary approach should be taken to prevent over-fishing than might be considered appropriate for other faster growing and more productive species, which will recover in a shorter period of time.
    
16. In the case of ORH 1, there is no formal stock assessment to provide estimates of stock status with respect to the biomass level that can produce the maximum sustainable yield (B _MSY). The information from the commercial fishery is characterised by both uncertainty and concerns regarding reliability. In fisheries with the biological characteristics like those of ORH 1, and where the available information is uncertain, unreliable, or inadequate, the TAC would usually be set cautiously low to ensure sustainability in terms of sections 10 and 13 of the Act.
    

Development of the ORH 1 fishery

17. The development of the ORH 1 fishery lagged considerably behind that of other New Zealand orange roughy fisheries. ORH 1 was introduced into the quota management system (QMS) in 1986 under a T ACC of 10 tonnes, when effort in this area was very low. The TACC was increased to 190 tonnes from 1989-90. Initial orange roughy catches in ORH 1 came from the Bay of Plenty in the mid-1980s. It was not until the mid 1990s that relatively large quantities of orange roughy were found to aggregate around the Mercury-Colville seamount features in the centre of the Bay of Plenty.
    
18. A trawl survey in the winter of 1995 estimated the biomass in the Mercury-Colville area at 78 000 tonnes. In response, a five-year AMP was initiated for ORH 1 as from the 1995-96 year. The AMP framework allows the TAC for low knowledge stocks to be set higher than would otherwise be the case, as long as, on the balance of probabilities, the TAC would move the stock towards the B _MSY level over the duration of the AMP.
    
19. The AMP framework relies on the collection of more information from the fishery than otherwise available, in order to assess and manage risks associated with the increased TAC. The TACC for ORH 1 was set at 1190 tonnes under an AMP, with a catch limit of 1000 tonnes applying to the Mercury-Colville ‘box’ area, and the previous TACC of 190 tonnes applying to the remainder of the ORH 1 QMA. In addition, research and exploratory fishing was undertaken under special permits between 1994 and 1997, which allowed up to 800 tonnes catch each fishing year in designated areas of ORH 1 and with feature limits applied.
    
20. The Mercury-Colville knoll fishery persisted near the 1000 tonne level for two years, after which catches declined (Appendix 2, table 2). Additional survey work was carried out in the area of the Mercury-Colville knoll in 1998 and 2000; the results indicated a much lower estimate of between 2500 and 3800 tonnes. The fishing pressure could not have been sufficient to result in this decline, and it was proposed that the decline could be a result of oceanographic conditions or movement of orange roughy between areas. Based on the available information, the AMP was concluded and the TACC was reduced to 800 tonnes for 2000-01. For that year, the Minister requested industry to implement a structured fishing plan with catch limits of 200 tonnes for each of four sub-areas within ORH 1, and individual feature limits of 100 tonnes to ensure the TAC was sustainable.
    

Purpose and requirements of the current AMP

21. The current ORH 1 AMP was implemented on 1 October 2001, with the objective of determining stock size, geographical extent, and long term sustainable yield, of the various features and sub-areas of the ORH 1 quota management area (QMA). In order to facilitate the objectives of the AMP and encourage fishing over a wide area, the TACC for ORH 1 was increased from 800 to 1 400 tonnes for five years under the AMP framework (as described in the Revised Framework for the Adaptive Management Program¹).
    
22. Controls and monitoring measures aimed at ensuring sustainability and encouraging exploration included voluntary catch limits by sub-area and undersea ‘feature’, as well as decision rules relating to progressive reductions of catch limits that would be triggered by reductions in CPUE. A critical element of the AMP was the use of CPUE to monitor relative abundance, both for increasing information on abundance (and distribution) generally, and for managing sustainability risks or risks of localised depletion.
    
23. Monitoring requirements of the AMP included a high level of scientific observer coverage to collect biological information on ORH as well as the weight and number of all species of fish and invertebrates caught. The AMP also undertakes to complete annual ‘directed exploratory fishing surveys’ in the Bay of Plenty to determine the extent of spawning grounds in the area.
    
24. In agreeing to the current AMP proposal, the Minister specifically requested that industry develop and implement a compliance and monitoring plan that would be in place before fishing began for the 2001-02 fishing year. The ORH 1 Exploratory Fishing Company subsequently produced the ‘Management and Monitoring Plan’² that set out quota owners’ undertakings in the conduct of the AMP. The company also produced a Memorandum of Understanding (MoU) to bind industry participants to the ‘rules’ under the AMP. Criteria for approval of AMPs (under the revised framework) and stakeholder undertakings of particular relevance to this full term review are that:
    
    • Increased TACs can be agreed where there is reasonable probability that
      current biomass exceeds the B _MSY level and that the TAC is likely to move the
      stock towards, or keep it at or above, that level over the five years of the AMP;
      
    • The increased TAC is not for an indefinite period and efforts have to be made to improve the understanding of stock status and yield;
      
    • There is scope to consider ongoing management of a stock at the conclusion of the AMP in the absence of an assessment of stock status and estimation of yield, but such ongoing management would require that stakeholders continue to collect the same level of information (under a longer-term plan) as under the AMP in order to justify retaining the increased TAC – however, this would require that there would be ongoing monitoring of changes in stock status and agreement that the TAC is sustainable;
      
    • There is an ‘onus on industry to either fulfil their commitments or face a reversal of the TACC increase’; and
      
    • Stakeholders accept the responsibility to work cooperatively to meet the AMP criteria, ‘otherwise the Minister of Fisheries will reduce the TACC to a level that he determines will ensure sustainability with no information’.
      

Operation of the current ORH 1 AMP

25. Both the AMP stock assessment working group (AMPWG) and the Minister have raised concerns about the operation of the AMP on more than one occasion. Concerns focused on industry governance where agreed sub-area and feature catch limits have been exceeded, and the desired scientific observer coverage levels in 2001 -02 and 2002-03 were not achieved. Those matters were of concern because exceeding the agreed sub-area and feature limits increased concerns over unknown sustainability risks, given the uncertainty of information underpinning those management measures. In addition, failing to achieve the desired level of scientific observer coverage could reduce the value of biological data collected about orange roughy and about any adverse effects of fishing under the AMP.
    
26. As a result of his concerns at the time, the Minister directed MFish to review the AMP at the end of the 2003 -04 fishing year. The Minister noted that he would withdraw the AMP if additional measures were not undertaken by industry to address governance problems and affirm their commitment to adhere to sub-area and feature limits. The Minister required the development and acceptance by stakeholders of an industry MoU designed to address governance problems.
    
27. In March 2004, industry signed the MoU commitment. Since then some sub-area and feature limits have continued to be exceeded. Monthly reporting has generally been reliable, although some reports have been delayed.
    

Misreporting and implications for data reliability

28. Orange roughy is a high value species so that there is a strong incentive to maximise catch. The geographically isolated, but productive ‘features’ with specific feature limits are a factor in misreporting of catch and effort within ORH 1. Misreporting is a significant matter in terms of the AMP, because of reliance on catch and effort trends as the tool by which the effect of the increased TAC can be monitored. Misreporting of catch and effort between features and sub-areas undermines the value of CPUE as a monitoring tool.
    
29. Lengthy investigations by MFish Compliance have revealed misreporting between features and sub-areas within ORH 1 under the AMP. Prosecutions ensued against one permit holder and one vessel master. The permit holder has pleaded guilty to some of the misreporting charges.The prosecutions focused on approximately180 tonnes of misreported catch. There are concerns within MFish and the AMPWG, that misreporting of catch from sub-areas and features has compromised the AMP data. The nature and extent of this problem has not been quantified beyond the scope of the current prosecutions. Once the current prosecution proceedings have concluded, a process of auditing, validating and correcting the data set will be undertaken.
    
30. Misreporting concerns in ORH 1 are not in themselves relevant to decisions on TAC setting under s 13 of the Act. However, it is one factor to consider (among others outlined) regarding the credibility of the current AMP for ORH 1 and whether it should be continued, and for how long. It also is relevant when weighing the information collected through the AMP programme and considering how reliable or certain that information is in terms of s 10 of the Act.
    

Results of the AMP

31. Appendix 2 contains the ‘2006 ORH 1 draft Plenary report’ that was compiled by the AMPWG after consideration of the ‘Full Term Review of the ORH 1 Adaptive Management Program’ in April 2006. The AMPWG was concerned that information in the full term review was not reliable, owing to problems with the accuracy of catch and effort data. As a result, the CPUE analysis was postponed until such time as the data had been audited. The minutes of the AMPWG meeting are attached as Appendix 3.
    
32. At the full term of the program, there has been some success with the AMP as it did spread catch between sub-areas A-D. Directed exploratory fishing work was carried out and there was generally scientific observer coverage of around 25-37% of trawl tows (although this is lower than the 50% coverage target under the ORH 1 AMP). Scientific observers collected useful information on target species length frequency and sex ratio, as well as bycatch information. However, there are concerns about the reliability of the catch and effort data collected under the AMP for the reasons outlined above, and this is relevant when assessing this best available information in terms of s 10 of the Act.
    
33. While the AMP was introduced to determine stock size, geographical extent, and sustainable yield, no estimates of stock size or yield are available. It is not possible to determine the sustainable yield of orange roughy in ORH 1 at this time. There is an assessment of yield for the Mercury-Colville ‘box’ that serves as the basis for the proposed orange roughy bycatch limit for that area, as discussed further in Appendix 2.
    
34. In the absence of independent research surveys, a long time series of CPUE data will be needed before any reliable assessment of the stock is possible. The existing historical data set will need to be fully audited, corrected and analysed before conclusions can be drawn from the AMP data to inform management considerations. There is limited information about stock status contained in the AMP data, and the lack of a formal assessment of status and yield is likely to continue for some time. In the interim, while some improvements in information have been made, MFish is still essentially dealing with a stock where information is inadequate and highly uncertain. In keeping with s 10 of the Act, a cautious approach should be adopted in setting a TAC to ensure stocks are being utilised at sustainable levels (at or above B_MSY as required by s 13 of the Act).

Risks of catch overruns from ORH 1 bycatch in overlapping deepwater fisheries

35. Orange roughy is one of a suite of deepwater species that share similar ecological habitats in the area of the ORH 1 QMA. Other species, which include alfonsino (BYX), black cardinal fish (CDL), ribaldo (RIB), ruby fish (RBY), and oreo species (OEO), are taken as a bycatch to ORH 1 fishing.
    
36. There is the potential for large quantities of orange roughy to be taken as a bycatch in these overlapping fisheries, and this is a factor that can contribute to the difficulties industry has with constraining catches within limits. For example, the TACs for CDL 1, 8 & 9, RIB 1, 8 & 9 and RBY 1, 8 & 9 have been greatly under-caught during the last five years, so that there is a capacity for increased effort and possibly increased bycatch of ORH 1. The medium value/volume target fishery for BYX 1 has had increasing catches over the course of the BYX 1 AMP with the 2004 -05 TAC 100% caught.
    
37. Across the ORH 1 fishery, large tonnages of orange roughy are taken as a bycatch to cardinal fish fishing. For the fishing years between 2001 -02 and 2004 -05, the tonnage of orange roughy taken through targeted fishing ranged between 793 and 989 tonnes, and over the same years the bycatch of orange roughy taken when fishing for cardinal fish ranged between 77 and 122 tonnes per year (average 99 tonnes per year). An additional 101 tonnes of orange roughy was taken as a bycatch to alfonsino in 2004-05.
    
38. The Mercury-Colville Box has had a 30 tonnes catch limit in place to allow the catch of orange roughy as bycatch to black cardinal fish targeted fishing. However, in some years this limit has been greatly exceeded by combined target and bycatch take of orange roughy. For the fishing years between 2001 -02 and 2004 -05 the tonnage of orange roughy taken through targeted fishing ranged between 16 and 52 tonnes (average of 30 tonnes), and over the same years the bycatch of orange roughy taken when fishing for cardinal fish ranged between 5 tonnes and 64 tonnes (average also of 30 tonnes). The amount by which the limit has been exceeded (noting that it was not reached in 2003-04) ranged between 11 and 86 tonnes.
    

Economic performance under the ORH 1 AMP

39. ORH 1 quota is held by a total of 23 companies, with three companies holding 90% of the quota, and the remainder held by mainly Maori interests.
    
40. Over the course of the current AMP between 4 and 8 boats (from 3 to 7 companies) have recorded ORH 1 catch each year. However, 14 boats have recorded catch at least once over the five-year period. The boats in the fleet range between 22 and 41 metres, with an average length of 30 metres. The ORH 1 fleet is composed primarily of domestic vessels with only minor participation by foreign charter vessels. Only one boat is recorded as having freezing capacity and this was also the only boat that has had a different flag-state (Australia).
    
41. The ORH 1 TAC is the second highest orange roughy TAC behind ORH3B. ORH 1 fishing is conducted throughout the year, although large catches are taken in the June -July spawning season.
    
42. Between 2001-02 and 2004 -05, the catch in ORH 1 has ranged between 986 tonnes and 1294 tonnes. Orange roughy has a relatively high value among finfish, with a 2005-06 port price of $3.67/kg. This has varied from $4.00 at the start of the AMP in2000-01 to a high of $4.81 in 2002 -03 and a low of $3.10 in 2004 -05.Given the decline in port price, there has been a reduction in the gross landings value of the fishery from $5.4 million in 2002 -03, to $3.8 million in 2003-04, and $3.6 million in 2004-05.

Assessment of Management Options

43. The current AMP for ORH 1 concludes on 30 September 2006, so it is timely to review the status of the fishery and the TAC of the stock, having regard to the best available information from the AMP and other sources. The Minister must set a TAC under s 13 that maintains the stock at or above, or moves it towards or above, a biomass level that can produce the MSY. The available information for ORH 1 is uncertain and inadequate, and there are concerns about its reliability. In making his decision, the Minister must have regard to those considerations regarding the information and adopt a cautious approach, having regard to the biology of orange roughy. Three management options are proposed, each likely to be sustainable in the short term, but some adopting a more cautious approach than others in terms of setting the TAC under s13.
    

Option 1 - Retain the AMP framework and 1 470 tonnes TAC for one further year

44. Option 1 proposes to retain the current AMP framework and current TAC for one further year.
    
45. The AMP has failed to deliver an assessment of stock status or yield, although information regarding geographical distribution has been obtained. These were key objectives of the AMP. At the start of the current AMP, scientific advice was that the stock was likely to have been above the B _MSY level, and, while it is now unknown whether or not the stock remains above B _MSY, MFish considers that continuing the current TAC for one further year is not likely to pose a high sustainability risk to the stock.
    
46. Retaining the AMP and current TAC for a further year would enable greater utilisation benefits than Option 2, at least in the short term, as well as providing opportunities for cost-effective data gathering through the continuation of the AMP program. This data includes scientific observer sampling of orange roughy length frequency information, sex ratios, and other relevant scientific observations. In addition, this option would provide time for the existing dataset to be audited and corrected during the coming year, so that this information can be more reliably used to inform future TAC setting.
    
47. Although it is thought that retaining the current TAC for one more year is not likely to pose a high sustainability risk to the stock, the longer term sustainability risks are unknown. Previous governance problems in complying with the AMP requirements are also of concern. There has been concerted effort to address these problems in the past, but with limited success.
    
48. The proposal to increase scientific observer coverage to cover 100% of trips is aimed at improving voluntary compliance with sub-area and feature limits, providing verification of fishing activity, and providing opportunities to maximise the collection of biological data relevant to the management of the fishery. This is considered to be necessary to ensure the greatest reliability of the available monitoring tools for the fishery. Option 1 places the onus on industry to show that previous issues under the AMP can be addressed and that industry can provide robust and credible management of its activities in this fishery.
    
49. Under Option 1 the ORH 1 bycatch limit of 30 tonnes for the Mercury-Colville ‘box’ would be retained to facilitate the target fishery for cardinal fish in the area. However, the expectation would be that industry would take the steps necessary to ensure that the limit was not exceeded, whether as a result of targeted fishing for cardinal fish or any other species.
    
50. There is no known recreational or Mäori customary fishery for ORH 1. MFish proposes that the Minister sets allowances of 0 tonnes for recreational and Mäori customary fishing under this option. MFish proposes that the current allowance for other sources of fishing-related mortality be retained at 5% of the TACC, which is equivalent to 70 tonnes, and is combined with the TACC to make up the TAC of 1 470 tonnes.
    
    

Option 2 - Reduce the TAC to 840 tonnes and replace the AMP with an industry-led structured fishing plan

51. Option 2 adopts a more cautious approach than option 1 by returning the TAC to the pre-AMP level, having regard to the uncertainty of the information collected under that AMP, the governance problems with the AMP structure in the past, and the biological nature of the stock. While the exact stock status is not known, this option provides greater certainty to the decision maker that sustainability is ensured over the longer term. This option still relies on some voluntary measures being put in place by Industry to better ensure sustainability in the longer term.
    
52. Statements within the AMP framework documents and the industry Management and Monitoring Plan note that the TAC increase to 1 470 tonnes was not to be indefinite and that, in the absence of an assessment of sustainable yield at the end of the program, it could be expected that the TAC would revert back to the pre-AMP level of 840 tonnes. The Management and Monitoring Plan also notes that in the absence of an estimation of stock status and yield, retaining the increased TAC would require that TAC level to be assessed as sustainable. There is no assessment of stock size or status, or sustainable yield, and therefore no assessment that the current TAC is sustainable. In the absence of such information it would be reasonable for the decision maker to revert to a more precautionary TAC level than that set for the duration of the AMP to better ensure sustainability in the longer term.
    
53. This option also involves moving away from the formal AMP structure that has proved historically problematic in the fishery.
    
54. There is no stock assessment to assist with evaluating the relative longer term sustainability risks posed by Option 2 versus Option 1. By reducing the TAC to 840 tonnes under Option 2 there is intuitively less risk (it involves less catch and presumably less fishing effort) that the fish stock will decline below BMSY.This represents a more cautious approach in the absence of adequate or reliable information. A cautious approach would be consistent with the information principles of the Act (s 10), the biological characteristics of this species, and the isolated features within ORH 1 that are particularly susceptible to over-fishing.
    
55. Option 2 proposes that the AMP be withdrawn and an industry-led structured fishing plan be implemented to manage risks of localised depletion or sustainability risks to localised stocks that might exist. In 2000-01, industry engaged in a structured fishing plan, with a TAC of 840 tonnes, at the request of the Minister. Option 2 suggests a reversion to these previous arrangements, under the reasonable expectation that industry would abide by them until the historical data has been audited and can be used to inform future TAC setting and longer term management arrangements.
    
56. Throughout the AMP it has been shown that the 30 tonne catch limit within the Mercury-Colville ‘box’ has been often greatly exceeded through targeted fishing for orange roughy as well as bycatch of orange roughy during targeted fishing for cardinal fish. This has resulted in more of the Mercury-Colville stock being removed each year than the tonnage that was previously assessed to allow rebuild of the stock to B_MSY. However, the current surplus production (CSP) for the ‘box’ stock was estimated (in the 2001 assessment) to be approximately 100 tonnes. The average catch since then is 99 tonnes, so stock size, in theory, should not have declined (although it is estimated at only 10 to 15% of B₀).One hundred percent scientific observer coverage will help to ensure that fishing within the Mercury-Colville ‘box’ is targeted at cardinal fish and not at orange roughy.
    
57. The TAC reduction proposed under Option 2 will have a direct economic effect on industry participants. If the average port price for 2001-02 to 2004-05 of $3.85/kg is extrapolated to the TACs under the Options proposed, then the TAC reduction under Option 2 (to 840 tonnes; resulting in an 800 tonne TACC) provides an expected value of $3.1 million. This represents a reduction of $2.3 million or 42.9% in gross port level revenues, compared to Option 1. Landings revenue does not provide a complete picture of economic implications; variations in currency exchange rates, fuel prices and other operating costs will also have impacts on net returns to operators.
    
58. The dollar reduction in export earnings associated with lowering the TACC would be significantly greater. A significant portion of ORH is exported in frozen whole, frozen fillets, chilled fillets, and frozen headed and gutted forms. The reported New Zealand FOB export value of all orange roughy products for the 2005 calendar year totalled approximately $68.9 million. The ORH 1 fishery accounts for about 9% of total ORH catch in New Zealand, and is thus a significant contributor to these export earnings.
    
59. MFish is aware that catch reductions can have social implications when employment opportunities for catching and processing staff are reduced. However, MFish has no estimates of the scale of effects on cultural or social factors such as employment or income that might arise from the proposed decrease in the TAC under Option 2.
    
60. Since there is no known recreational or Mäori customary fishery for ORH 1, MFish proposes that the Minister sets allowances of 0 tonnes for recreational and Mäori customary fishing. As for Option 1, MFish proposes that the allowance for other sources of fishing-related mortality be determined as 5% of the TACC, which equates to 40 tonnes with an 800 tonnes TACC.
    

Option 3 – withdraw the AMP and reduce the TAC to ensure sustainability in the absence of fine-scale management

61. Option 3 is the most cautious approach and aims to set in place a TAC that better ensures sustainability presuming an absence of industry-applied structured fishing plans (whether under an AMP structure in Option 1 or fishing plan structure in Option 2). This even more cautious approach may be necessary if industry is unwilling to continue to spread catch within ORH 1 as proposed for Option 1 or 2 TACs. Should industry be unwilling to implement a structured fishing plan under Option 2, Option 3 would provide for a TAC that could better ensure sustainability of the whole ORH 1 stock in terms of s 13 of the Act and reduce the risk of localised depletion in the absence of fine-scale management. Such arrangements would have a greater economic impact on industry than would Option 2.
    
62. MFish does not propose a specific TAC level at this stage, but an appropriate level could be determined from the range of feature limits that have applied under the AMP. The purpose of those limits has been twofold – to ensure that effort is spread within sub-areas, and to ensure that catch from any one feature is sustainable and does not give rise to localised depletion. In the absence of fine-scale control of catch, the TAC would need to be set at a level that could ensure sustainability of the stock as a whole in terms of s 13, bearing in mind any information on likely fishing location and effort, and effects of any localised depletion on the stock as a whole.
    
63. Ideally catch in the Mercury-Colville ‘box’ would still be constrained given the greater concerns over sustainability of catches in this area. MFish proposes that the 30 tonne bycatch limit for the ‘box’ be retained under this option, in light of the available assessment for that area. One hundred percent observer coverage of fishing in the ‘box’ would be necessary to ensure the integrity of the bycatch limit.
    
64. Option 3 would place greatest weight on ensuring sustainability, but would be expected to have a substantial adverse effect on utilisation and socio-economic outcomes, particularly in the short term.
    

Statutory Considerations

Considerations relating to utilisation and sustainability

65. The purpose of the Act is to provide for the utilisation of fisheries resources while ensuring sustainability. Section 13 of the Act requires the Minister to set a TAC at a level that maintains the stock biomass at or above the B _MSY level or moves it towards or above that level. The Minister must take into account the interdependence of stocks, the biological characteristics of the stock, and any environmental conditions affecting it, as well as such social, cultural, and economic factors as he considers relevant.
    
66. Section 10 of the Act requires that decisions should be made on the basis of the best available information. Any uncertainty in that information needs to be considered. Decision makers should be cautious when information is uncertain, unreliable or inadequate. The absence of information or any uncertainty in information should not be used as a reason for postponing or failing to take any measure to achieve the purpose of the Act. The key statutory considerations relevant to ORH 1 are detailed further in Appendix 1.
    
67. The key considerations for the proposed options are the sustainability risk of the TAC and additional arrangements; the impact on utilisation; and the degree to which the governance structure under each option is likely to deliver credible fisheries management to satisfy the utilisation and sustainability obligations.
    
68. At the end of the current AMP there is no assessment of whether or not the current TAC is sustainable, or any of the proposed TACs will move the stock towards B _MSY. Within the Mercury-Colville ‘box’ there is an assessment that suggests that the stock is below B_MSY, and a catch of around 100 tonnes will probably maintain current stock size, and catches between 16 tonnes and 35 tonnes are consistent with MCY or CAY strategies, which may allow the stock to rebuild slowly.
    
69. The biological characteristics of orange roughy, and the lack of any assessment of sustainable yield, provide for the need to take a cautious approach to management in the light of uncertainty, as is indicated by the information principles under s 10 of the Act. While the best available information is that the current TAC is not likely to pose a great sustainability risk for one further year, it is not known whether or not it will maintain the stock at or above the B_MSY over the longer term.
    
70. Available information about the interdependence of stocks is inadequate to provide guidance on the appropriate level for a TAC. Data extracts show that at times there has been significant catch of ORH 1 as a bycatch to targeted fishing for other deepwater species, and there is significant latent capacity in some of these fisheries, such that increased catch of orange roughy may occur in the future. Targeted fishing for orange roughy is considered to be relatively clean, however, since the bycatch levels are relatively low with the fishery targeting aggregations of orange roughy. Environmental conditions that might affect the stock are not well understood and no specific environmental conditions have been determined that would influence a TAC decision.
    
71. Social cultural and economic factors of relevance are likely to be focused on the socio-economic effects of forgone utilisation if catch limits are reduced under Options 2 or 3, as well as the socio-economic benefit that would result from continuing the AMP under Option 1.
    
72. MFish does not favour a two-year extension for the ORH 1 AMP, as the history of the AMP shows that problems are likely to continue in light of limited success of previous efforts by the Minister and MFish to address issues with industry governance and compliance. Option 1 is proposed for a period of one year and the onus is on industry to prove that industry governance in this fishery can provide credible and robust fisheries management.
    
    

Environmental considerations

Marine mammals

73. MFish considers that the proposed options will have no adverse implications for fur seals and other marine mammals, as proposed options provide either a continuation of the status quo, or a reduction in orange roughy catch limits.
    

Seabirds

74. Trawl fisheries for orange roughy are known to interact with seabirds, and fishing-related mortalities of seabird species are known to occur. Seabirds can be killed when they collide with or become entangled in the trawl gear. Further, the knowledge of the population characteristics of some seabird species is also limited. Those factors together make it difficult to quantify the overall impact of fishing (and of trawling for orange roughy) on sea bird species generally, or within the ORH 1 area. However, MFish considers that the proposed options have no additional adverse implications for seabirds as proposed options provide either a continuation of the status quo, or a reduction in orange roughy catch limits.
    

Fish bycatch

75. The 2006 Draft ORH 1 Plenary Report (Appendix 2) provides useful scientific observer information on the fish bycatch collected from the fishery.
    
76. Targeted orange roughy fishing tends to be clean with 96.9% of the catch consisting of orange roughy, and orange roughy and cardinal fish together accounting for 99.1% of the total catch. The proposed options have no adverse implications for fish bycatch as it is not proposed that the TAC be increased under any of the options. Details of fish bycatch are provided in the 2006 Draft ORH 1 Plenary Report (Appendix 2).
    

Benthic impacts and coral bycatch

77. Studies of bycatch generally have dealt with fish species. While trawling can adversely affect fragile benthic invertebrate communities, the commercial bycatch of benthic invertebrates is seldom recorded or examined. Research has revealed marked differences in the bottom fauna of fished and unfished seamounts off New Zealand and Tasmania, and those differences have been ascribed to the impact of bottom trawling. ^{3, 4}
    
78. Coral species constituted almost 9% of the catch by weight in the South Tasman Rise (off Tasmania) orange roughy trawl fishery between 1998 and 2000. Although it was difficult to relate the reduced coral bycatch over time to a decline in the total coral biomass in the area, researchers suggested that a considerable decline in biomass had occurred. Vessels were reported to repeatedly trawl along the same towlines, and coral bycatch would be reduced as the initial accumulations of coral within a towline were removed.
    
79. It is not known if the coral bycatch in the South Tasman Rise compares with features and fisheries within New Zealand waters. Researchers have reported anecdotal evidence of bycatch of coral species in developing orange roughy fisheries in New Zealand. Underwater photographic surveys have revealed marked contrast in the distribution of coral species between fished and unfished seamounts in New Zealand waters. Results showed almost 100% coral cover on unfished seamounts compared to between 2 and 3% cover on trawled seamounts in the area of the Northwest Chatham rise.
    
80. Photographic surveys have helped to provide clear evidence of a substantial impact on the benthic fauna from deepwater trawl fisheries (including for orange roughy) in New Zealand. The photographs revealed evidence of trawl disturbance, including gouges and furrows in the bottom sediments on seamounts that were attributed to trawl doors and bobbins (‘rollers’ placed along the trawl footropes). Extensive patches of broken and fragmented coral were regularly observed on both fished and unfished seamounts, and it is possible that damage to coral outcrops occurs naturally as well as being caused by physical contact with trawl gear.
    
81. MFish has developed a strategy to address the impact of trawling on seamounts generally. Nineteen seamounts of varying size and depth within New Zealand waters have been closed to trawling. All but one of the closed seamounts were unfished at the time of closure, and closure should thus protect representative faunas in a variety of habitats from the effects of fishing. MFish considers the seamount strategy satisfies the obligations to avoid, remedy, or mitigate the impacts of fishing on seamounts generally. MFish notes that six of the seamount areas closed to trawling under that strategy are located within ORH 1, MFish notes that this strategy serves to mitigate the adverse effects on seamounts but that MFish and industry are continuing to work in initiatives to address adverse affects of trawling on benthic habitats including seamount features.

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¹ The Revised Framework for the Adaptive Management Program dated March 2004 is available on request from MFish.

² The Management and Monitoring Plan and MoU were prepared by the ORH 1 Exploratory Fishing Company, and are available on request from MFish.

³ Anderson, O.F. and Clark, M.R. 2003 Analysis of bycatch in the fishery for orange roughy, Hoplostethus atlanticus, on the South Tasman Rise. Marine and Freshwater Research, 2003, 54, 643-652.

⁴ Clark, M.R. and O’Driscoll, R. 2003 Deepwater fisheries and aspects of their impact on seamount habitat in New Zealand. J. Northw. Atl. Fish. Sci ., Vol.31: 441-458.