Capacity Utilization

Capacity utilization is the ratio of a fleet’s actual catch or effort to the maximum it could produce if fully deployed, a diagnostic for overcapitalization. A low ratio signals that vessels, gear, and crew sit idle relative to what the fleet could land, which inflates fixed costs and pressures managers to lift quotas. FAO and the OECD use capacity-utilization estimates to flag fleets with excess capacity that should be reduced through decommissioning. The measure separates short-run idleness from structural overcapacity, the latter being the target of buyback and vessel-reduction programs.