Ocean Choice International (OCI) on Friday confirmed that it is restructuring its Newfoundland and Labrador operations to better compete in the marketplace, including permanently closing two processing plants and laying off hundred of workers.
The St. John’s-based seafood supplier, one of Canada’s largest, said it is shutting down its Marystown and Port Union facilities immediately and investing more than CAD 5 million in 2012 in its fishing fleet and its facilities in Bonavista, Port aux Choix, Triton, St. Lawrence and Fortune.
If the company’s flatfish operations are successfully restructured, an additional CAD 10 million will be invested in a new vessel, according to the company. These investments come on top of the CAD 30 million invested in the company’s plants and vessels since 2008.
“OCI has always been prepared to work with others in the industry, governments and unions in an effort to restructure the sector,” said OCI President and CEO Martin Sullivan. “However, in the wake of continued challenges, it has no choice but to realign its operations.”
Sullivan attributed the decision to restructure to the diminishing market for filleted fish and the need to stay competitive. “Today, the demand in our growth markets in Asia and elsewhere is for whole fish or headed-and-gutted fish,” he said. Sullivan also pointed to the need for government to lift its restrictions on minimum processing requirements and seafood exports.
According to OCI, the only way the Marystown plant could turn a “marginal” profit was to export 100 percent of its yellowtail flounder production. The Port Union plant has been hit hard by a 40 percent drop in shrimp catches in the past three years, with another quota cut set for next year; it was also damaged heavily by Hurricane Igor in September 2010.
About 240 workers were employed in Marystown, and about 170 were employed in Port Union.
The company is, however, transitioning its Fortune facility into a year-round, multi-species groundfish processing plant.
“While we are disheartened today by the unfortunate impacts of our restructuring on the people of Marystown and Port Union, we know that we have made a responsible decision to ensure that our business will continue to return to the people of the entire province a sustainable industry for the future,” said Sullivan. “We intend to work closely with government on labor force adjustment programs to seek solutions to transition our workers in a respectful manner.”
