Update on lobstering crisis from Maine Lobstermans Association.. (Portland, Bangor: sale, buying) - (ME) - City-Data Forum

deerislesmile · 10-13-2008, 12:03 PM

Dear MLA members

The MLA Board held an emergency meeting last night to discuss
the unfolding global financial crisis and the implications for our lobster
markets. Things are not good, and we don't expect things to improve
anytime soon. The MLA Board has committed to meet twice a week to
identify ways we might be able to influence this situation and to advocate
for our membership during this crisis.

We've done our best to understand what is going on right now,
how severe the situation is, and when we might expect things to
improve. Here's some of what we have learned:

*Maine lobster is selling at a very low price (less than $3/lb along
the coast; we've heard as low as $2.50) or product is not moving
at all. Price is expected to continue to fall.
*October is peak landings month and value for Maine lobster. In 2006,
the Maine lobster industry landed 16 million lbs of lobster valued
at $65 million. That's a lot of lobster!

In terms of market, here's what's going on:

*The processing industry in Canada has been affected by both a lack
of credit and a soft consumer market. Many Canadian processors
borrow from Icelandic Banks which have collapsed.
*Some Canadian processors have stopped buying product, but the reasons
vary -- some have a lot of inventory on hand already, others cannot get the
credit needed to buy product, others are operating at less than full capacity
in hopes not generating more supply than they can sell.
*Consumer demand for both live and processed lobster is weak. Large
restaurant chains which move a lot of lobster such as Red Lobster and
Outback Steakhouse have experienced losses. Fewer consumers are eating
out regularly, and those who do cannot afford an expensive meal. Demand
has also softened from cruise ships and casinos due to poor economic
conditions. This has resulted in an overall decline in demand for lobster.
*October 13 is Thanksgiving in Canada, so no Canadian processors will buy
product over this weekend; those who are operating will start up again on Tues.
*Maine lobstermen and dealers are experiencing very different conditions right
now. Some are able to move product through live markets or processors who are
still operating, others are not able to move product at all bc they may only
sell to one or two processors who just aren't buying right now.
*This situation is not expected to improve any time soon. This is a global crisis
affecting many industries, not just lobster.

There is some general agreement that given the slack demand, it would be prudent
to limit the supply of lobster to prevent a glut in the market. However, there is no agreement
on the best way to do that. There is NOT support to shut down our fishery and stop the
supply of lobster. This would be devasting to our markets; we need to keep
our current customers supplied.

Ideas that are being discussed include (there is no consensus, just ideas):

*Lobstermen need to work with their individual dealers and limit fishing so
that lobsters are not landed unless they can be sold.
*The government should intervene in order to slow the supply of Maine lobster
entering the market, so that supply is not outpacing demand. Ideas have included
taking a week off, limiting the fishery to a certain number of days per week, taking
traps out of the water to limit the catch. But, there is no guarantee that any of these
actions would lead to a better price or stabilize the market. The goal would be to
bring supply back in line with demand.
*The Commissioner has no authority to intervene in this crisis; the Commissioner's
emergency authority is limited to actions to prevent the resource from imminent depletion.

What actions have been taken so far?

*Some lobstermen at coops have agreed not to fish unless they are able to sell their product
for a minimum price, and many dealers on an individual basis are asking lobstermen
not to fish, because they simply can't move the product. However, there are reports
of people fishing anyway, hoping to just sell somewhere else at whatever price they
can get. The price point at which individual lobsterman cannot operate profitably will
vary depending on the volume of product landed.

The Maine Lobster Promotion Council (MLPC) has a few initiatives in the works.

*They have set up a promotion through Hannaford supermarkets to retail lobster at
as low a price as possible. Hannafords will trim their margin significantly to help
move product. This should move some product through the northeast region. The
ad will run at the end of next week (Oct 17 flyer).
*MLPC has reached out to North Atlantic Lobster, who sells to Shaws and Walmart to
try to get a promotion similar to what Hannaford's is doing at those retail outlets.
*MLPC has created a public service announcement (PSA). Twenty-five radio stations have agreed
to run this piece in Maine. They will also reach out to the Boston radio market to get it
on the air there.
*MLPC is working with the Governor's office to do a Maine lobster promotion with the
Boston Red Sox through the playoffs.

The MLA has been working every angle on this. We are reaching out to the MLPC, the Commissioner,
our legislators in Maine, our Congressional delegation, and the Governor. We are trying to
get everyone educated on the current crisis, and work on a strategy to help improve our situation. However,
we do not have a lot of options that could realistically impact this situation. MLA is organizing a
charitable lobster giveway to attract national media and raise awareness about the crisis affecting
our industry.

So, the bottom line is we know things are bad, and it couldn't have happened at a worse time.
The MLA Board will meet again on Monday to continue to discuss options. The Lobster Advisory Council
will meet next week to discuss the situation and they will also get an update from the Maine Lobster
Promotion Council. The DMR is also discussing organizing some informational meetings to hear
concerns from the industry and potential strategies to help us cope.

I'll do my best to keep you informed from my end. Please be patient if you call the office as the phone
has been ringing off the hook. We are doing are best to keep up with all of this.

Patrice McCarron, Executive Director
Maine Lobstermen's Association
21 Western Ave # 1
Kennebunk, ME 04043
207-967-4555; 866-407-3770 (fax)
www. mainelobstermen. org

Related Article in the Press Herald: Plunging prices strain state lobster industry | Portland Press Herald

dmyankee · 10-13-2008, 12:21 PM

The free market will eventually work it's way out of the doldrums for the lobstermen. My lobsterman customer was in just last night and we were discussing this. You still have to go out and make a living.

The Canadians buy about 70% of the catch for processing from what I hear. Why no processing here? Wasn't it Genghis King, as governor, who said "No fish will leave Maine intact.," meaning all the catch would be processed locally and not sold wholesale to Canada. What a crock!

In the meantime...A round of lobster on the house! I'm diggin' the price deal.

ProdigalLobster · 10-13-2008, 01:35 PM

Wow... when I chose my screenname for this forum, I wasn't aware there was a crisis in the lobstering industry (I live 'away' now).

I'm sorry to hear of it; used to date a guy who had worked on a lobster boat, & so appreciate that lobstermen work extremely hard.

mollysmiles · 10-13-2008, 02:11 PM

deerisle, thanks so much for all your postings and keeping us informed.... keep it coming!

Hepcat · 10-13-2008, 02:30 PM

Does this mean its my civic duty to go out and buy lobster for dinner?

I have been looking for an excuse, I love lobster! Now I can indulge guilt free..... I have a moral obligation to help support the Maine economy, since I plan on moving there some day. A lobster dinner is the right thing to do!

Submariner · 10-13-2008, 02:44 PM

I think that for the CD meet in Bangor we should all order Lobstah

deerislesmile · 10-13-2008, 03:04 PM

Quote:

Originally Posted by ProdigalLobster

Wow... when I chose my screenname for this forum, I wasn't aware there was a crisis in the lobstering industry (I live 'away' now).

I'm sorry to hear of it; used to date a guy who had worked on a lobster boat, & so appreciate that lobstermen work extremely hard.

Your screenname made me laugh, actually.

Yes- everyone- have a lobsterbake! I've been at it for 3 days so far.

*licks butter off fingers*

ProdigalLobster · 10-13-2008, 03:21 PM

Quote:

Originally Posted by deerislesmile

Your screenname made me laugh, actually.

Thanks!

This is my kind of cause. 'Course, down here I'll have to make extra sure of their pedigrees to make sure they're Maine & not Canadian. Hmm... wonder if I can find some *real* hot dog buns & make lobster rolls.

tcrackly · 10-13-2008, 05:22 PM

I think lobstermen and fishermen would do well to follow the lead of some of the smaller farmers and retail direct to the public. I'm sure getting something closer to the current retail price is far better than what they get wholesale. And there's probably many middle men that get rich on directing product to point of sale while the boatman goes hungry. If there were something like a C.S.A. account for sea food I would probably do that so I could be assured that stuff is feresh. I can't say I would eat lobster everyday but ususally the price of lobster is what scares me away.

Elcarim · 10-19-2008, 01:33 PM

Do they sell them from the docks? I know I'd be there buying them every week if they did!