Canada's Newfoundland and Labrador Standing Fish Price Setting Panel has decided to remove a mandatory deduction on lobster prices and base the collective pricing agreements on the average Thursday-Tuesday Urner Barry prices without deduction.
The pricing panel, which just finished wrangling with a controversial price setting process for the regions crab fishery, was determining whether to reinstate a mandatory deduction on the agreed-upon price of lobster paid to harvesters by processors. In 2019, the price deduction was CAD 0.15 (USD 0.12, EUR 0.11), and in 2021 the deduction was CAD 0.11 (USD 0.08, EUR 0.07)
According to the panel, a large part of the decision relates to the current sky-high prices for lobster, and the massive increases in export value the fishery has seen in recent years. In 2021, the fishery landed 11 million pounds of lobster and earned harvesters in excess of CAD 84.5 million (USD 66.9 million, EUR 62 million), while the export value of lobster soared to CAD 121 million (USD 95.8 million EUR 88.8 million). In contrast, in 2013, the reported export value was CAD 7 million (USD 5.5 million, EUR 5.1 million).
The export statistics were the central issue that led the panel to decide to eliminate the deductions. The Association of Seafood Producers (ASP) argued that the Newfoundland fishery was largely a live market, where buyers “sell into the live market in the week following the week in which they purchase raw material on the wharf,” the panel’s report states.
However, the Fish, Food, and Allied Workers (FFAW) union argued that processors have been investing in lobster storage so that the lobster can be sold during high-value months.
“Just because lobster exports were not an issue in 2011 (when the pricing formula was introduced) does not mean that we should downplay or ignore the importance of exports in assessing the fairness of the formula,” the FFAW wrote in a submission to the panel. “As exports increase, they need to be considered in ensuring that the formula remains fair.”
The panel acknowledged there may be some difficulty shipping to some export markets, especially in China.
“Several areas of China such as Shanghai and Guangzhou, are currently experiencing lockdown due to a significant increase in COVID-19 cases. If this were to persist, it could have a dampening effect on overall lobster prices,” the panel said. However, China has generally been successful to date in taking aggressive measures to control COVID-19.”
One thing both parties agreed on is the record prices for lobster in the U.S. The Canadian Press reported that fishermen in the Canadian Maritimes are seeing record prices.
“Our lobsters are gold-plated now. Prices have been the highest in commercial history,” Tangier Lobster Managing Director Stewart Lamont said.
CTV News also reported that some restaurants are taking lobster rolls of the menu as prices reach historic highs. Some fishermen have reported receiving CAD 19.50 (USD 15.44, EUR 14.31) per pound at the shore, which they said was the highest price they had ever seen for the lobster they sold.
Photo courtesy of Lynn A/Shutterstock
