Lobster Crisis, Part 2:
Fishermen Examine Profitability and Quality
by Laurie Schreiber
ELLSWORTH – Lobster fishermen are trying to figure out how to avoid the market glut and price crash they faced over the past summer.
In the face of prices that reached a 30-year low, the Lobster Marketing Subcommittee of the Department of Marine Resources’ (DMR) Lobster Advisory Council, in August, proposed that the industry create a new entity to market and promote Maine lobster. The entity would be funded by fishermen, dealers and processors, who would contribute, through a license surcharge, $1 million in the initial year, increasing up to $3 million annually by year three.
The contribution would replace the existing promotion surcharge on lobster fishing license. According to a meeting summary that was reviewed by the Zone B Lobster Council at its September meeting, the recommendation will be written up in a bill to go before the state Legislature. The DMR will craft language for the marketing bill.
The DMR and the LePage administration are “interested in developing a model that will eventually include all Maine seafood,” the summary says.
The recommendation is to create a board where representation would be 75 percent harvesters and 25 percent dealers/processors. The split would be relatively matched by the funding contributions.
Last year, according to the summary, $377,318 was collected from the lobster promotion surcharge, which is one-tenth of a percent of the landed value of the fishery for marketing. For a Class 3 harvesting license, the marketing surcharge would come to $573, compared with $33,000 for bait, $15,000 for fuel, and $32,000 for a sternman.
In June, the crisis had the phones at the DMR ringing “off their hooks,” DMR Commissioner Patrick Keliher wrote in a guest editorial published in the Maine Lobstermen’s Association newsletter.
He continued: “Every segment of the lobster industry – harvesters, dealers, and processors - weighed in with opinions about the lowest boat prices seen in over 30 years. I was asked to do everything from ‘shut it down’ to ‘slow it down’ to ‘leave it alone.’”
As commissioner, Keliher wrote, he does not have the statutory authority to use emergency rule-making powers to intervene in a fishery in order to influence the market or address economic conditions.
Keliher said the early shed, combined with increased harvests to the north, drove the low boat price. And there has been an overabundance of processed product in freezers in Canada, with no destination, he wrote.
“It seems to me that, with regard to the troubles with the boat price, there is not an end in sight,” Keliher wrote. “I bring this up not to be pessimistic, but because I think it’s important to understand that this situation is not a passing problem. I think we have to manage the fishery to improve the value of Maine’s lobster harvest for everyone involved. It just doesn’t make sense to flood the market with soft-shelled lobsters. This is going to require discussion of management alternatives that will impact fishing practices.”
The summary listed a number of “front burner” suggestions that merited further discussion with the industry. These included days out, improved handling, delayed tag issuance, rolling closures to avoid harvesting very soft lobster, gauge changes to harvest bigger lobsters and create a spring fishery, proportional trap reductions, and reconsidering the cap on tags.
Other suggestions, to be put on the “back burner,” included avoiding harvests of very soft lobsters during March and April, when the price is low; and quotas, which would encourage harvesters to take product as needed and at best quality.
Peter Jones, a wharf manager in Vinalhaven, told the Zone B Council that some kind of change in fishing practices might help the situation.
“You have to understand the market you have,” Jones said.
The processing market dominates at least 75 percent to 80 percent of the harvest, he said.
“Both the live market and the processed market basically are five-day-a-week markets,” Jones said. “When you’re fishing in the summer, you’re fishing six days and, in September, you’re fishing seven days. Two days a week, you’re putting lobster on a closed market. And it creates surpluses that lower the demand.”
Jones said the industry might want to consider taking off weekends, at least from May through October.
During peak times, he said, it also might make sense for the industry to establish some sort of standard, perhaps a price standard: When the price dips below the standard, he said, the industry would stop fishing for a day or two.
He said it’s important for the industry to maintain some form of control over marketing. Although the processing sector is a large segment of the industry, he said, it’s not the answer because it’s “the lowest common denominator” in terms of price.
“You have to fight to find more live markets,” because that’s where the money is, Jones said.
“Each of you has to become your own advocate, your own salesman,” he said.
He suggested that fishermen explore the idea of creating their own niches, such as “Swan’s Island lobster.”
Jones also said that fishermen might want to work with dealers to find out what would help to get a better price.
“They’re not the enemy,” Jones said of dealers.
And, Jones said, the industry should look for more marketing opportunities beyond the East Coast.
“The East Coast is saturated with lobster,” he said.
Zone B Chairman Jon Carter said the sale of about two tons of lobsters to cruise ships that visit Maine, in September and October, was helpful.
“The more we can come up with things like that, with different markets, then eventually it will make things better for everybody,” Carter said.
As to taking time off from fishing, members of the council said that traps left in the water, whether they’re being hauled or not, are still fishing.