Buyers don't like low prices either

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Lobster fishery

By Tina Comeau

THE VANGUARD

NovaNewsNow.com

 

The executive director of the Nova Scotia Fish Packers Association says low lobster prices are not something that buyers want to pay, as they too are concerned with the impact this has on the industry and on communities.

But they also have to pay a price based on the ability to move the product and at the start of this lobster season moving the product has been challenging due to volume, said Marc Surette.

“In comparison to last year at this time, landings are estimated to be 25 to 30 per cent higher overall, with some seeing lower while others are seeing drastically higher catches,” said Surette. “As for the market, we are being stretched to the limits. With the volume that has come ashore no one is able to properly deal with what is a constant rush of supply.”

Surette said on Wednesday that over the past couple of days the landings had started to drop off. But inventories are still high and the demand was still soft, he said.  

He noted that a strong Canadian dollar continues to affect all exports, and lobster is a prime example of that. Then you have to factor in the reality that the United States and European Union economies are still in some level of recession and growth in China – seen to be an a possible emerging market for lobster – is slowing.

Still, many fishermen blame the price they are being paid on the greed of buyers whom they believe could be paying more for the catches. But Surette said in their association they have buyers who have taken steps to try and control the landings and the lobsters they are purchasing so they don’t have to pay an even lower price to fishermen.

“We have buyers who have refused to take on more boats, refused to take on all the boats they have had in the past to limit their supply, and in some cases refused to buy this season at all,” Surette said. “That certainly doesn’t sound like greed.”

The price fishermen have been getting paid is $3 a pound. Surette said out of concern of the price dropping further, at the end of the first week of the season's opening a group of buyers had approached the Department of Fisheries and Oceans to request a variation order from DFO to close the fishery for 72 hours to give buyers a chance to move through the product that had been landed and to give them the time to restructure for the increased supply.

But DFO rejected that request, saying it can only close a season if there is a conservation issue or a public safety issue.

“Buyers do not want the price to drop. That is a common misconception,” Surette said. “As with harvesting, costs on shore have also been increasing while the difference between ‘buy and sell’ prices have been constantly shrinking. Again, the idea of greed is part of the total lack of trust, something that I have stated time and time again within the Lobster Council of Canada, as well as to the Senate Committee studying the lobster industry right now.”

To address the issue of the landings and price, Surette says the industry needs to reduce supply, standardize quality and increase demand. But although these things are all very basic in principle, he said, they are not easily put into practice.

On Wednesday the 1688 Professional Lobster Fisherman Association held meetings in Yarmouth and Barrington where fishermen were urged to shut down the industry to allow the association time to negotiate a better price with buyers. But neither meeting drew a large turnout. About 70 people showed up for the one in Yarmouth and around 50 for the one in Barrington. Most boats were out fishing.

Prior to the start of the season there were efforts to address landings but none of them materialized. An effort to organize crewmembers to strike didn't draw the numbers needed. A plea by 1688 not to set gear until there was a committed price from buyers wasn’t adhered to. And a proposal by the LFA 34 Management Board to reduce the trap limit was voted down by a majority of the licence holders. So the fishermen approached the start of the season as status quo, even though in past years the status quo hasn’t worked to their favour.

Asked whether a trap reduction would have had an impact, Surette said it while such a measure might not have reduced landings overall during the season, it may have helped in spreading out the landings in a more efficient way, “easing on the immense landings seen in the first week of the season.”

Meanwhile, lobster continues to be viewed by many as a luxury food item yet Surette said if lobster isn’t viewed in that way, how can you expect people to pay higher prices for the product when compared to other proteins available in the marketplace?

“It is that ‘luxury’ perception that kept prices high based on much lower supply,” he said, adding, however, if the market continues to be flooded causing prices to be depressed, eventually lower prices will be the norm, which doesn’t do anything to increase the value of the resource. “Demand for lobster (live and processed) must be increased substantially in order to match the historic supply. We need to have less product than the market wants, not more.”

 

Organizations: Nova Scotia Fish Packers Association, Department of Fisheries and Oceans, European Union Lobster Council of Canada Senate Committee Professional Lobster Fisherman Association LFA 34 Management Board

Geographic location: United States, China, Yarmouth Barrington

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Recent comments

  • Get Together
    December 10, 2012 - 18:27

    The buyers can shut it down by just stop buying for 72 hours......There needs to be a trap reduction and a shorter season...6 months is way to long for them to fish....if they don't do something now there will be no lobster industry in Alantic Canada....everybody got bills to pay but when you get the catches that you do where do you except all the lobster to go...wake up guys before it to late....