Hanging on For Survival in Chiloé: Ground Zero in Chile’s Salmon Bust

Quellón, Chile – In the dwindling light of a crisp autumn evening, snow-covered Corcovado and its sister peaks shine pink above the silhouetted fishing boats that stretch out beyond the harbor in Quellón. The alpine glow is short-lived, though, and as the sun drops below the horizon.

Lights flicker on in the mostly empty hotels and restaurants that line the Costanera, a bay-front road stretching the length of the city. The air smells of wood smoke, salt water and decay. A handful of drunks lurch by in the direction of Quellón’s main pier, where a dozen other men lean idly against a railing. Surrounding the dock are boats of all shapes and sizes. Too many are anchored. The city, some people fear, is dying.

Pummeled by a "cocktail" of crises, Quellón has fallen on hard times as all three of the city’s principal economic activities – salmon farming, shellfish production and traditional "artisan" fishing – are suffering serious setbacks. The unemployment rate now stands at a staggering 50 percent. Many residents are simply packing their bags and leaving.

"The city is full of people just walking around," said Juana Chiguay, a union leader and assembly line worker in a local salmon processing plant. "Before it wasn’t like that. Everyone was working all day. In the shops too, there used to be several salespeople. Now you go in and there are just one or two."

From Boom To Bust

Located at the southern end of Chiloé, a large island more than 1,000 kilometers south of Santiago, Quellón has always been a backwater. Still, until recently it enjoyed a sustained period of steady growth thanks to famed salmon industry, which took off like wildfire after first gaining a foothold in Chile in the mid 1980s.

Between 1991 and 2006 the salmon industry saw its annual earnings rise from US$159 million to more than US$2.2 billion, a meteoric expansion of roughly 2,200 percent. During that span it created thousands of jobs, most of them concentrated around Puerto Montt and in Chiloé. A particularly dense cluster of salmon farms and processing plants formed around Quellón, boosting the city’s population (now roughly 30,000) as workers flooded in from outside the region.

The hours are long and working conditions less than ideal, but salmon factory jobs can offer "good money" – up to 350,000 Chilean pesos (US$600) per month – according to Chiguay. A modest salary by Santiago standards, it is nevertheless double Chile’s minimum wage.

"Before, when there was more salmon, we’d get hired at around 290,000 pesos per month (US$508), which is good money around here. Plus there are production bonuses, and overtime. You earn money in the plants, but in exchange you give up a lot. You spend more time in the factory than at home," said Chiguay, a member of the Federación de Sindicatos de Quellón (FSQ).

"Part of me is really thankful for the salmon industry, because it’s the reason I came here," she added. "I own a house. I have the basic things you want. But it’s sad now because the town is dying."

Starting about two years ago, the industry, long considered a shining star in Chile’s lauded export-driven economy, began losing its luster. First came reports of serious sea lice infestations. Sea lice, or Caligus, are parasitic crustaceans that attach themselves to fish, marking their hosts with ugly lesions that lessen their market value, stunt their growth and leave them vulnerable to sometimes fatal illnesses. Then, in July 2007, researchers confirmed the presence in Chiloé of precisely such a disease: Infectious Salmon Anemia, or ISA.

Both the Chilean government and SalmonChile, the industry’s private producers association, did their best to downplay the viral outbreak. But among Chiloé’s highly concentrated fish farms, which at the time accounted for roughly 50 percent of the country’s total production, ISA spread quickly, forcing the closure of numerous salmon farms.

Industry leader Marine Harvest, a Norwegian company, was the first to announce wide-scale layoffs, warning in early 2008 it would close two processing plants and axe 1,000 jobs – roughly 25 percent of its Chilean workforce. Other companies followed suit. Labor unions estimate that to date, more than 15,000 people have been laid off.

Quellón was particularly hard hit. Last December the salmon company Granja Marina Tornagalenos closed a local plant, sending about 800 workers packing. Other factories remain open, but now operate with just a portion of their original workforce. The FSQ estimates only 150 people now work at a nearby Pacific Star processing plant, down from a peak of 1,800. In total, some 3,500 salmon workers have lost their jobs in and around Quellón.

"We’ve been seriously hurt," said the city’s mayor, Iván Haro. "In all of Region X, we’re the community with the highest number of salmon farms in our bays and estuaries. On top of that we have the most processing plants. So (farmed salmon) is an incredibly important part of our economy."

The ongoing global financial crisis hasn’t helped matters for Quellón, which despite its relative isolation is very much dependent on foreign consumers to buy its salmon and shellfish exports.

Then came the coup de grâce: a "red tide" that originated further south and appeared in the waters around Quellón in March. Authorities responded to the toxic algal bloom by temporarily prohibiting the extraction of shellfish. The prohibition, implemented just before Holy Week (when Chilean families traditionally feast on seafood), delivered a major blow to both artisan fishers and the shellfish industry.

According to the mayor, there are still 50,000 tons of farm-raised mussels waiting to be harvested. The mature shellfish are now "at serous risk of rotting," which could compromise the area’s water quality further still, said Haro.

"From one moment to the next, all three of our economic pillars crashed to the floor, something that never happened before," he said. "As a result, out of our total labor force of maybe 12,000 people, half are now unemployed. Fifty percent of my population, of my community, is out of work!"

Panic and Desperation

Even a casual observer can see the effects of the crisis: men spend their entire days milling about the waterfront on the off chance some incoming boat will need an extra hand or two. Local eateries are almost vacant, although some of the drinking establishments near the pier continue to attract clients. The once steady traffic of salmon industry well boats is now down to a trickle.

"Yes, there’s unemployment," said Juan, a middle-aged shellfish diver I met on the Costanera. "There are no new jobs. Salmon workers are just waiting to eventually go back to work in the same area, because we’re not an industrialized city. We live off natural resources and the salmon industry."

"Many salmon workers came from the country. Now they’re forced to go back there," he added. "But they’re just living in the country, not making any money. The people stuck in the city are worse off. In some cases they don’t have enough to cover their basic expenses."

The situation is heaping pressure even on people who still have jobs. In the salmon factories, remaining workers are working longer hours and in some cases accepting lower pay, explained Juana Chiguay. Fish shipments come in spurts and the companies, to satisfy their immediate needs, are hiring and firing at will. They are "taking advantage" of the labor surplus, signing workers to short-term contracts that deny employees access to long-term benefits, she said.

"Supposedly it’s voluntary. But everybody knows that’s not really the case," said Chiguay. "In Los Fiordos the bosses don’t ask, ‘can you work on Sunday?’ Even when they know you have kids, they just say, ‘you have to work Sunday.’ What can people say? It’s their boss."

People are so panicked about losing their jobs that many of Chiguay’s female coworkers are getting pregnant, she explained. Under Chilean law, pregnant women enjoy a 15-month grace period during which they cannot be let go.

"There are tons of pregnant girls. Before it wasn’t something you saw much," said Chinguay. "You have to stop and think. A child is something you have for the rest of your life, while the job protection only lasts one year and three months."

"Quellón Burns"

Seeking company in their shared misery, labor groups from Quellón’s various economic sectors began reaching out to each other, particularly after the red tide extended the city-wide depression beyond the salmon industry. Salmon workers, artisan fishers and shellfish workers held joint meetings. They then organized with local government officials to hammer out a series of demands, which they presented to regional authorities.

Government aid was slow to arrive, however, and as conditions worsened, frustrations continued to build. By May, with winter around the corner and unemployment rising, tension in the city began to approach a breaking point.

"We didn’t get hit with just one crisis, but rather a cocktail," said Marco Mansilla of the Sindicato Pescadores Mar del Sol, an artisan fishing union. "We had meetings with the governor, with the regional presidential representative, and with the regional ministerial offices, and they said, ‘we don’t see a problem here.’ We kept saying in meeting after meeting, ‘this can’t go on.’ There are people going hungry, people having to sell their belongings to buy food. I think that’s when things just got triggered."

The proverbial final straw came in the form of a leaked government report confirming what many people had suspected for months: that salmon industry well boats, which ship live fish from Region XI to Chiloé, were responsible for spreading the red tide to Quellón. SERNAPESCA, the government’s fisheries department, has since made that report public.

Accusing the salmon companies of "bioterrorism," the now unified labor groups mobilized. Starting at midnight on May 19, several dozen people occupied one of the lanes on the highway leading out of town. The protestors endured a long, wet night and at sunrise, continued to hold their position. At approximately 8 a.m. police moved in, provoking a violent confrontation.

Word of the police crackdown filtered quickly and soon hundreds of people joined the demonstration. Taxis shuttled protestors free of charge. Members of a local indigenous group joined the fray, as did a handful of brothel workers. People used tires to light huge bonfires. Some people distributed lemons and salt to counteract the teargas. "Quellón Burns," screamed the May 20 headline in La Estrella de Chiloé, the island’s principal newspaper.

"As far as the authorities are concerned, we don’t count for anything," said Mansilla. "It seems the only way they’ll pay attention to our problems is if we use force. Instead of advancing by way of dialogue, we turned into primitives. We had to grab rocks and sticks in order to negotiate."

Promises, Promises

The uprising earned the protestors some very real concessions, starting with invitations to meet top government officials in Santiago. Accompanied by Mayor Haro, the union leaders headed north and soon sat down with ministry representatives who promised a long list of aid measures. Among other things the government committed to direct job creation, paid training programs, a new laboratory to better control water quality issues and loan guarantees for entrepreneurial projects.

Most of the promises, though, are limited both in terms of funds (training program participants will receive minimum wage) and time. It’s unlikely, for example, that the salmon industry crisis will be resolved in the six months that some of the government programs are scheduled to last.

For now, at least, tensions have calmed somewhat. The protests ended. Quellón’s labor leaders have decided to give government authorities the benefit of the doubt, allowing them a chance to make good on their promises. Still, few expect the city to recover anytime soon.

"This is just the beginning," said Chiguay. "Do you think that with all these people going Quellón will be the same? My answer is no."

"I’ve even thought about leaving myself. Because it’s hard to imagine a future here. I think more about my daughter than I do myself. I think all parents think that way. I want her to study. I don’t want her to stay in this town. I want her to study something that doesn’t have anything to do with salmon."

Contact Benjamin Witte at patagoniatimes@gmail.com.