Twenty-five years since brothers Don and Basil Lucas started Combined Fishing Enterprises, the question of how best to utilise a small quota is as relevant today as it was then.
The brothers come from a family steeped in fishing – their grandfather, father and Basil himself all found employment in the local fishing industry – and in 1994, Don agreed to help Basil set up a fishing venture.
“I never wanted to be in the fishing industry,” recalls Don with a smile. “I went off and studied finance and accounting and treasury (at the University of Limerick in Ireland) and in 1994 I came back to South Africa. My brother had bought a vessel but he hadn’t registered a company yet and he was going through some financial difficulties. He asked me to assist him, so we formed Combined Fishing Enterprises.”
The company was one of the first non-white firms to secure a quota in the deep-sea trawl fishery, but its 400 ton allocation was insufficient to warrant investment in a deep-sea trawler. In 2000, Combined Fishing Enterprises purchased a trawler in the hope and expectation of securing a more viable quota, but the allocation at that point was still not enough to sustain the vessel and after almost 10 years of struggling to survive, it was sold.
Like many smaller quota holders, Combined Fishing Enterprises was forced to search for a joint venture partner and to keep on applying for quotas. To a large extent, it was the latter strategy that secured the company’s longevity in fishing.
“We got a hake longline quota and later on we got a small pelagic quota,” explains Don. “Hake trawl is our biggest quota and we are in a joint venture with Sea Harvest. We also have a hake longline quota and a joint venture with a small operator. For pilchards, we have a joint venture with Gansbaai Marine. We are planning to buy into the factory and we’ve also bought into a vessel there.”
Combined Fishing Enterprises manages the operations of another company, Tuna SA. It links Japanese boat-owners and South African rights holders in the large pelagic fishery and targets tuna for the sashimi market. Fishing takes place inside South African waters and on the high seas.
The result of 25 years of drive and determination is a diversified fishing company that is resilient to the hard knocks that come with fishing.
“The advantage (of diversification) is that you cross subsidise,” explains Don. “In times when one fishery is down – for instance this year we had zero pilchards (owing to very low pilchard biomass) – we have other quotas that can cross subsidise our costs.”
The lack of autonomy that many smaller rights holders complain of is very relevant to Combined Fishing Enterprises. Small quota holders are understandably regarded as a junior partner in a vessel owning joint venture and this is an uncomfortable position for a 25-year old company to be in, as Don explains:
“Our quota is too small to have a big share in a vessel and because of that we are less of a trend setter and more of a follower. We would like to have at least an equal share and an equal say in the operation of a vessel and for this we need viable quotas,” he says, adding that as government prepares to allocate rights to 12 commercial fishing sectors in 2021 it must consider the needs and aspirations of small and medium-sized companies like Combined Fishing Enterprises that have made investments and survived on the back of small allocations.
“I know that the minister (of Environment, Forestry & Fisheries, Barbara Creecy) is looking to bring in new entrants, but I truly believe that smaller quota holders like ourselves need to be given a more viable quota so that we can create more jobs in our own companies and in the joint ventures that we have with the bigger companies. So, we would like an equitable and more viable-sized quota in all the fisheries we’ve invested in,” he says.
While Don may have resisted a career in fishing, his family’s history is as important to him as it is to Basil and the brothers are nurturing the interest and talent of Basil’s daughter Bianca Brophy whom they hope will continue their legacy in fishing.
“She is going to take over our company when we retire and she’ll bring up the next generation,” he says. “Bianca will be the fourth generation in fishing and we don’t see the lineage ending there.”