Victoria Cooperative Fisheries, Ltd.

by Sandra Dinsmore

Packing crab at the Victoria Cooperative Fisheries, Ltd processing plant. The coop was founded by fishermen nearly 60 years ago. Victoria photo

Although Neil’s Harbor, a tiny hamlet at the northern tip of Cape Breton Island, Nova Scotia, doesn’t look like much on a map, its lobster and snow crab fisheries cooperative supports the families of its 127 members and their crews from seven harbors and 100 miles of Cape Breton’s Northeast Highlands coastline. This co-op is the area’s primary employer.

The co-op includes seven buying stations from Ingonish Ferry to Bay St. Lawrence, a restaurant it leases out, its own trucking company, a retail marine supplies company, and a processing plant—the only active lobster processing facility on Cape Breton. During peak fishing periods the co-op members, crews, and staffs of its businesses produce employment for about 500 people. In the off seasons the Northeast Highlands area, though extraordinarily beautiful, is singularly isolated.

The co-op started in 1955, incorporated a year later, and will celebrate its 60th anniversary in 2016. Osborne Burke is in his fifth year as co-op manager, and he couldn’t be better suited for the job. He’s from the area—his mother was from Cape Breton’s northernmost village, Meat Cove, where the road ends—and as a young teenager he started working as a crewmember on fishing boats. Although as an adult Burke has worked at various jobs, he’s always returned to the fisheries. At one point he fished his own boat as a Victoria co-op member, which gave him the member’s perspective, and he’s worked as a fisheries consultant.

Originally the co-op started without a processing plant. It dealt in groundfish for many years. Burke said buyers would come in at the peak of the season and buy the product. “In many cases,” he said, “it was like the company store concept: [fishermen] owed more to the merchant at the end of the year. There wasn’t a lot of cash changing hands. They charged.

“The fishermen wanted to control their own destiny,” Burke said, adding that although they had a few tough years and at one point almost sold the co-op, they hung on, and the co-op grew and expanded. “Over the years,” Burke said, “they decided to put more money in for refrigeration and started the groundfish plant.

“Groundfish was a big item then,” Burke recalled. “Lobsters were very small. Snow crab didn’t even start until the early ’70s. Then eventually when the groundfishery collapsed, the co-op switched over to shellfish.

“Over the years,” Burke continued, “the fishermen, with the assistance of then co-op manager Lloyd Lamey, were forward-looking enough to put their own processing facility in to generate local employment and to have more local control.” Today the co-op’s trucks carry product from Neil’s Harbour across Canada and the United States and the co-op ships product all over the world. (The week this story was being written, Burke was on a trade mission to China and Korea.)

The co-op building has a long-term tenant, a pharmacy. The rental helps pay the cost of the operation. Then, too, the co-op’s marine supply business carries $350,000 in stock, which Burke said the company turns over probably three times a year. The co-op’s buying station at Bay St. Lawrence, one of its largest harbors, also has $100,000 worth of marine supplies at any given time. Burke says the co-op’s payroll generally runs over $2 million a year in the local economy.

“How this co-op goes, profitable or not, has an impact on the entire area,” he said. “We are the largest employer in Victoria County, and when the co-op is active—when the fishery is active—the grocery store does well because if we didn’t have this plant, this facility, half the people here wouldn’t be living here. That would have an impact on our schools because if people couldn’t get employment, they’d have to move elsewhere. The co-op, such as it is, is like the whole heart of the operation.

“How this co-op operates is extraordinary,” Burke observed. “The critical thing is you have to re-invest back in.” He explained, “The board members at each annual meeting will recommend to the members in attendance that a percentage of the profits be reinvested back into the operation. In some cases it is as high as 100 percent, but in most cases it is usually 50 percent of the profits.” He noted, “This reinvesting has been done over the years, in good years, and in bad years. If you don’t reinvest back into the business, it will fall back down around your ears.”

Members have also improved their crate run of lobster by grading out culls on the boat. Co-op board vice president Greg Organ said the problem of culls being harder to sell and having higher mortality came up at a director’s meeting. A few board members suggested fishermen separate the culls themselves instead of paying plant workers to do it. Although culling the catch didn’t result in a higher price for a crate run, it made for a more attractive product and higher sales. As Organ put it, “A buyer could say, ‘I could go to so-and-so and I know there’s 10 percent culls, or I can buy from Victoria Co-op and maybe there’s only 3 percent culls.’”

Co-op members also improved snow crab product quality by switching their crab fishing season from July, when the surface water is around 65 degrees, to April, when it is around 38 degrees. “The quality of our crab,” Organ said, “has increased, like, major.”

“We have the members bringing their product into their own facility,” Burke said. “We’re processing, and we have our own trucking company. Although there are peak times of year when we have to hire other trucks, we have our own trucks carrying our own product.” He explained that one of his trucks had just hauled product to Mobile, Alabama, one truck was on the way to South Carolina, and another was headed to New York State. In some cases the trucks were delivering the co-op’s product and in others they were delivering product for other customers to create additional revenue for the co-op’s trucking company. In winter the trucking company has a few trailers and its trucks are part of the salt hauling contract for highways, so the trucks work year round. The co-op’s restaurant provides seasonal employment usually from June through October.

“The goal of the plant,” Burke said, “is to work from April to December. A few months in heavy winter will always be a challenge for us. Will we ever be 12 months a year?” he asked rhetorically. “Who knows? We’re striving to be active nine months a year. That’s our goal.” With members and manager working so positively and efficiently, there’s every chance the Victoria Co-op will achieve that goal.