Fisheries Committee on May 28th, 2010

[The Chair, Conservative, Rodney Weston]

I call this meeting to order.

Ladies and gentlemen, thank you for joining us today here in Moncton. The Standing Committee on Fisheries and Oceans, as I'm sure you're well aware, has been studying the snow crab industry in Atlantic Canada and Quebec, and today is our fourth and final meeting. We've been travelling around Atlantic Canada and Quebec, and we certainly look forward to your comments this morning.

Mr. Bevan, I believe you're going to make opening comments this morning.

[David Bevan, Assistant Deputy Minister, Ecosystems and Fisheries Management, Department of Fisheries and Oceans]

Yes, I will. I'd like to introduce my colleagues. Joan Reid is area chief, conservation and protection for eastern Nova Scotia. Mikio Moriyasu and Marc Lanteigne are from the gulf fisheries centre. They are looking at the issues of crab science, so they should be able to help you with respect to that.

I'll make a few opening comments and try to keep them brief. I'm sure you've heard many in the course of the last few days.

In Canada, snow crab is harvested and processed throughout the east. As you are well aware, Nova Scotia, New Brunswick, Newfoundland and Labrador, Quebec, and Prince Edward Island are all involved in this very important fishery. We produce about 50% of the world's production of snow crab. Notwithstanding the very significant declines in the population in area 12 this year, our overall production has not altered that much. So it's around 70,000 tonnes, and that's the situation again this year.

As I said, we have about 50% of the world's production. Notwithstanding that, we are still a world taker of price, not a setter of price. We are not structured in a way that allows us to actually control markets. We are under the control of significant middle people in the market. We sell most of our products in Japan, and our most significant market is the United States. But brokers are the ones who are controlling that and the price, etc., and we're price takers in the marketplace. Right now we get between $1.30 and $1.70 per pound for the product, and it's sold on the world market for about $4 a pound retail.

Commercial fishing for snow crab began in this area back in the 1960s, as significant stocks were discovered. It developed throughout the 1980s. In the 1990s it entered a period of rapid growth, where we saw the stocks develop very significantly throughout Atlantic Canada. We also saw at that time the decline in groundfish. Given the situation with the decline in groundfish and the growth in shellfish--and at that time the price was very high--ministers were pushed to take people from the groundfish fishery and introduce them into the crab fishery.

The resource peaked around 2002 across Atlantic Canada. In the gulf we had a peak in 2005, but that was part of the natural cycle. In 2009, catches were worth about half a billion dollars. It's the second-largest industry in Atlantic Canada after lobster, which is around $750 million. We have around 750 licences currently in the Maritimes and Quebec and 3,400 in Newfoundland and Labrador.

We face difficulties in this fishery on two fronts. First are economic factors. The dollar is at par, we have high input costs for gas and bait, and we have a lot of competition from Alaska and Russia. Secondly, snow crab goes through cycles of abundance, particularly in the gulf, where in about a 10-year period it goes from peak to peak or trough to trough.

Unfortunately, this time the cycle is low at the same time that costs are high and prices are low. So having low abundance and low price at the same time has caused so much hardship. We expect this trough in the gulf to last into next year. Then we hope--if all things are equal and we don't see a change in natural mortality--it should start to increase again in 2012.

We've been here before in this kind of...you know, 7,700 tonnes is very low. We were at 8,000 tonnes a few years back, and we have climbed to an abundance of 30,000 tonnes on that cycle. We're hopeful we'll be able to manage this cycle through prudent and precautionary management.

We conduct scientific surveys in the gulf in particular, and the long series of data provides us with good information on the abundance, not only of what's fishable biomass but also on the prognosis for the coming years. It's sound advice that we've been able to use in the management of the fishery over the last number of years.

With snow crab we have two ways to protect the stocks. First, of course, is TAC and quota. We set a TAC based on the fishable biomass and an exploitation rate for that biomass that establishes the TAC. In addition, we also have the benefit of using the dimorphic nature of this beast. The crab is such that mature males are very much larger than mature females, and we can target the mature males fishable biomass for the markets and avoid the females and the juveniles. We have the use of mesh size in the traps to allow the large males to be retained and the smaller females and the juveniles to escape.

We only keep males over 95 millimetres, and those are the males that are in their terminal moult. They've been in the population for about eight or nine years when they reach that stage. They moult for the last time and they're then in the fishery where they can be caught. They live for about another five or six years after the terminal moult, so there are a number of years that they're available to the fishery.

We also manage the season such that we avoid soft-shell crab, crabs that have just moulted. They're vulnerable to handling and they could be damaged or killed if they were fished at that time. Even if they were thrown back, there's a high degree of mortality. We set seasons to avoid moulting populations, and, as I said, we target the mature males.

In the Gulf of St. Lawrence, in particular, we have one population that's fished in areas 12B, 12F, and 19. It moves around over the course of the year, from 12 to 19 and so on and so forth. It's one population, and we have to therefore manage it as one population. That's consistent with the advice we received from the FRCC some years ago, that we should stop trying to manage individual areas and manage the areas that reflect the population. So one population should be managed as one unit.

Landings peaked in the southern gulf at 33,400 tonnes in 1982. They dropped to 8,900 tonnes in 1990. The landings last year were 23,400. This year, of course, we've had a significant reduction in the TAC. The landings will be reflecting that, but that reduction is necessary to avoid taking the population down to a level that might make the recovery, which we expect to happen in 2012, less sure and put it in jeopardy.

In the 2010 TAC, the minister placed the priority on conservation. It was a big hit, but it was necessary in order to allow the stock to rebuild significantly. We recognize the hardships. We certainly made changes to policies in the harvesting sector in the southern gulf to allow for less costs for harvesters by combining quotas, allowing them more flexibility on partnering with other vessels, etc. We recognize that has helped, but it has not alleviated the difficulties in the processing sector. That's something the provinces are going to have to deal with.

We guide our decisions through science, and in the southern gulf we have a very good track record on science in terms of understanding what the data means and understanding where the population is and where it is on the cycle, etc. We have less ability in some other areas. For example, in Newfoundland and Labrador, we don't have the same kinds of time series of data, but we do have catch per unit effort and other indicators of abundance that we use.

We are working on a precautionary approach for the southern gulf, so we have in the southern gulf an estimation of what the biological limits are in terms of what we should not take from the population of fishable biomass below and what the harvest levels should be in terms of maximum harvest levels, and harvest levels that should take place between the limits that are representative of good, healthy stocks and the limits that are representative of stocks that are in more difficulty. We've done that in conjunction with the industry, and we are bringing that into play. That helps the industry as well in terms of getting eco-certification, if they so desire, and getting access to markets that require that kind of assurance.

I think I'll stop it there and let you ask some questions. Thank you.

[The Chair, Conservative, Rodney Weston]

Thank you very much, Mr. Bevan.

Mr. Byrne.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Thank you very much, Mr. Chair.

Thank you, Mr. Bevan, for coming back again to our committee and providing us with good information.

I'll direct my first questions to Monsieur Lanteigne and Monsieur Moriyasu, just in terms of the science. Both of you gentlemen have been quoted in the media as saying there has been a problem in the southern gulf crabbing area 12 for awhile. Now the current cuts are a culmination of that. In fact, your comments in the media are very consistent with what the Department of Fisheries and Oceans' Canadian Science Advisory Secretariat's own science advisory reports for 2007, 2008, and 2009 have been saying about the southern gulf crab. In 2007, the report said the population was in a phase of decline. The report in 2008 said that recruitment to the fishery declined by 39%. In 2009, the report concluded that recruitment to the fishery declined by a further 13%.

It seems to me that there is clear evidence that science has been doing its job. It's been providing advice to the department and to the minister that stocks have been fragile, and have not been fragile since last season but have been fragile for awhile. Could you comment to the committee about some of the scientific findings, not just from this past year but from the last several years?

[Marc Lanteigne, Manager, Aquatic Resources Division, Gulf Region, Department of Fisheries and Oceans]

I agree with you that science on an annual basis can provide advice on the status of the stock and the protection for the following season. What you presented is a good summary of what science advice is providing to management.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

That's basically all I think the committee needed to receive confirmation on, because the issue now, Mr. Bevan, is why didn't the department, in terms of the resource management, act on this advice? The concern that's been raised by fishermen, by the processors, by the plant workers, by the industry, and by the communities is that while no one is arguing the results of science, what they are very concerned about is the failure of management to act on the advice of science to mitigate a 63% drop in one season. That's the concern. Industry has no capacity to be able to acclimate, to adjust to a cut of over 14,000 tonnes, 63%, in one season.

Mr. Bevan, would you be able to comment to the committee on why the department failed to act on a more timely basis when the science was clearly available to it?

[David Bevan]

As I mentioned in my opening remarks, there's more than one way to conserve this stock. We have a stock that we take advantage of in terms of the biological difference between males and females, and we target the fishery on the mature males only. So there's an additional safety net there in terms of conservation.

We do take the science advice very seriously, obviously, and that's always been the foundation of decisions, but there are other considerations in terms of the economics, the advice of fishers.

Last year, fishers came to the department with a very significant presentation that indicated that they had doubts, and they presented that and that was under consideration as well. It was part of the issue, and if they wished to do that and take the consequence of the outcome, that was part of the consideration as well. That was something the minister did consider and took into fact for her decision last year.

Having said that, we always know that there's a need to ensure that on the bottom of the abundance you take care of the stock first, and that's what's been happening this year. Last year's decision, the year before, etc.--those decisions were taken with full knowledge of the fact that we were in the downward trend in the cycle and that there would be a trough that we'd have to manage through and deal with. That was done this year, with the difficult decision to put the fish first and to ensure that we made the trough as short as possible, in terms of how long we have to live with this kind of TAC, and to set rebuilding as the priority and do that as quickly as possible.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

The information that you're providing us, though, indicates that there were options that were still available for this year. Your opening remarks indicated how the fishery is conducted—targeting males. In terms of conservation, this is not like a groundfish species or a pelagic species. It follows a different pattern. The consequences of harvesting this particular species are different from what you would experience with a groundfish or a pelagic species. I think that's the gist of what you're explaining when you say you target mature males in the fishery.

With that said, what you're also explaining to us is that you clearly had further options this year. The disconnect, Mr. Bevan, I think, to the industry on the ground and to the department's current decision in 2010 is the 63% cut. There's a fiduciary responsibility of the minister to protect the stock, to protect the species, and to protect the fishery. In my knowledge of this industry, and particularly of the southern gulf, I can't ever recall a time when the quota increased or the fishable biomass increased by 63% in one year. It seems like a very, very high number for an increase or for a decrease, and that's the disconnect.

Could you explain for the benefit of fishers that you had no choice? Could you explain for the benefit of the industry, through us, that basically because you did not take decisions in the last few years, that's why this occurred? Would that be a correct statement to make?

[David Bevan]

No, I think this decision this year was made based on the advice we had this year, but also on our experience in other areas. For example, in area 13 we've seen what happens if we keep the harvest rate very high for a long period of time. We ended up with a problem in that area and we had to shut down the fishery. We didn't want to get into that situation in area 12, because it's too important.

In fisheries of this nature, even if we have the safety net built in by not fishing females and juveniles, we do have a situation where if we fish too hard on the fishable biomass, that is to say, the mature males, we could damage the stock to a point where it would not recover as quickly as it otherwise would, or it would recover over a much longer period of time. It's too important to have that risk.

What we decided to do, from a conservation point of view, based on the science that we had and based on the work that was done to introduce a precautionary approach in this fishery, that is to say where they were looking at biological limits that should not be exceeded, if you're not going to have a high risk of not recovering or recovering over a longer period of time--based on that information, which was available this year, it became evident that we had to take action to reduce the TAC and allow this population to have a quicker recovery than it otherwise would. In the past, we've taken time to lower it over a period of years, etc. We had the 50% rule on finfish, as you may recall, for cod—and look at the results that brought us. So we recognized there was a risk, and we had to take a very significant decision this year to overcome that risk and allow for a quick recovery.

We certainly recognize the hardship this causes. The hardship it causes this year, and probably next year, is going to be offset by future growth. That's our expectation. We didn't want to risk future growth by trying to manage the hardships over a couple of years, or three years, only to have a situation where we created long-term suffering in the southern gulf snow crab fishery.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

I appreciate what you're saying.

Given the fact that risks were taken, as you acknowledge, risks that turned out to be difficult and causing hardship as the end result, are there any plans by the Department of Fisheries and Oceans, or the Government of Canada generally, to provide any assistance to those who are negatively impacted by these cuts this year? Are there any plans for any sort of financial assistance program?

[David Bevan]

In the short term, the short answer to that is no, because this fishery has gone through cycles. A few years ago, in 2005, it was at a peak, and in 2004 it was very lucrative. We had earnings that were quite considerable, with gross earnings in the $800,000 range per enterprise for some of the traditional people.

Yes, it's tough this year, and earnings are down a couple of hundred thousand dollars, but to provide assistance now is not a priority. Our priority is to rebuild the stock and to get the earnings back up as best we can, because of the world market situation, back up to where they were on the average for the last cycle.

The average earnings in this fishery are fairly good over the course of a cycle. So what the government did in 2003 was to say, okay, the allocations are fixed and we're not changing them; you guys manage the up cycle and manage the down cycle.

So we're in the down cycle and people are having a difficult time, particularly workers in plants, etc., but we've indicated to the fleets that they can have the flexibility to reduce their costs at this time in the down cycle. But there will be an up cycle, we expect, starting in 2012. We don't think taxpayers should take care of subsidizing the fishery over the low part of the cycle when there are going to be good profits ahead and they have had good profits in the past.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Thanks, Mr. Bevan.

[The Chair, Conservative, Rodney Weston]

Monsieur Blais.

[Raynald Blais, Bloc, Gaspésie—Îles-de-la-Madeleine, QC]

Good morning. I'm going to continue and ask you the same type of question, but I hope you'll give us a different type of answer because what you're telling us is far from satisfactory.

First of all, you said you had received scientific opinions over a number of years indicating that the harvest rates for 2007, 2008 and 2009 were really dangerous. In spite of that, you nevertheless decided to continue authorizing high harvest rates in 2007, 2008 and 2009. In 2010, however, a 63% reduction in that rate was announced.

That's a problem. On the one hand, you say that the precautionary approach should be given priority and should take precedence, but when we consider the decisions made, we don't get that impression.

We wonder what other considerations there may have been for accepting a high harvest rate that endangers the species and thus jeopardizes an industry. How can you explain that?

[David Bevan]

We set the tax in consultation with the industry, the provinces, first nations, and obviously in consideration of scientific advice. The difference between the previous years and this year is that the scientific advice was really, really clear, plus the fact that we had done work on the precautionary approach leading up to this year. So this year we have had additional information regarding what is an acceptable harvestable biomass and what are the risks of going below that. That additional information made it clear that we are at the bottom of the cycle of abundance, that we had to take action to minimize the time we're going to stay at this level and to maximize the probability of climbing out of it. That's what the decision was based on this year.

The risks in the past few years were less clear or less significant, and we could keep the catch at a higher level. This year required significant corrective action in order to minimize the amount of time we stay at the bottom of the cycle of abundance.

[Raynald Blais, Bloc, Gaspésie—Îles-de-la-Madeleine, QC]

That's where the problem lies. You confirmed that the harvest rate was really too high in 2007, 2008 and 2009, which presented a high degree of risk. It's like playing with fire; you wind up getting burned. It's as though you waited to get burned in order to react. The precautionary approach or the principle of sound management means that, from the moment you see there's a problem, or a fairly high degree of risk, you realize that, if you maintain that degree of risk, it will be much more serious in future. So then you consider cutting quotas.

That cut in quotas could have been spread over a number of years, which would have helped us avoid the present situation. Cuts in the order of 63% have a major impact. For some people, it's even a disaster. That's what's hard to understand. I agree that it's easy to say so afterward, but it's also a matter of common sense.

When you see any kind of problem, and when you realize there is a certain degree of risk, you have to react. It's like when a roof leaks. You don't expect it to leak a lot before you repair it. You repair it as soon as possible, when you see that it's starting to leak. That's somewhat what has happened. It's as though you believed that there was a degree of risk, but that it was not yet high enough and that you had to wait for the degree of risk to be very high in order to act. Unfortunately, if you wait too long, the actions you take may have much more significant impact.

This has impact on human beings. A little earlier we were talking about the decline in the species, but there's another species, and that's the people who work in the plants, the people who work on the fishing boats and the fisherman's helpers. These people are hard-up; they're stuck. They can't change direction and decide to do something else. A few days before the fishery opens, they learn they've lost their jobs. Ultimately, the fishermen have no choice; they have to cut their costs. The plant workers wait, wait and wait again. We're hearing about cuts in the order of 40% or 50%. We've been hearing that very recently. Suddenly, it hits, cuts of 63% are announced.

What's the logic in that?

[David Bevan]

Clearly we understand the impact this decision has had on fishermen and on crewmen and on plant workers. The impacts are significant, obviously, this year. If we didn't take action, it would not just be this year and next year, but all the way into the future. We had to take action on this part of the cycle because we're at the bottom of the cycle of abundance and we have to take action to make it short.

[Raynald Blais, Bloc, Gaspésie—Îles-de-la-Madeleine, QC]

My problem isn't in 2010. My problem is in 2007, 2008 and 2009. That's where I have a problem. That's where there is a problem.

[David Bevan]

We have been on a downward cycle since 2005, there's no question. The risks of maintaining the TACs at that time were less than they are this year. We could accommodate the desire of the fishermen to maintain TACs similar to those of previous years because the risks were less. This year, because of the work that was done on the precautionary approach and looking at the biological limits, but more importantly based on the status of the stocks, we had to take action to ensure that the amount of time we spend at a low level of abundance is minimal and that we will have rebuilding as quickly as possible. In the past it was done to mitigate the impacts on the fleets and the plant workers, but this year we had to put the fish first.

[The Chair, Conservative, Rodney Weston]

Thank you.

Mr. Donnelly.

[Fin Donnelly, NDP, New Westminster—Coquitlam, BC]

Thank you, Mr. Chair.

I also am having trouble, as my colleagues are, with understanding how the decision was made for this year and why, for instance, a similar decision wasn't made last year or earlier.

Mr. Bevan, in your remarks you referred to area 13. I think you referred to it as what we don't want to do. Could you explain a little bit about how and why decisions were made in area 13? Given your comments about the precautionary principle and how you would ideally manage with that principle taken into account, for such decisions as the recent decision, how is it in a case such as that of area 13, which you referred to, it wasn't taken into consideration?

[David Bevan]

Area 13 was a situation that came up years ago, actually before we were fully engaged in the precautionary approach and looking at biological limits in harvest limits. Area 13 was one in which we relied almost exclusively at the time on the biological differences between males and females, so we had a very heavy fishing effort on the mature males. The result was that the stock crashed, the fishing had to stop, and directed fishing has been just coming back now, at a very low level. It has had a significant impact on the fishermen in that area, because we didn't have the same degree of knowledge that we have now and didn't apply the precautionary approach at that time because of a lack of understanding of what it meant and how to establish the biological limits that drive the precautionary approach.

This demonstrates that if you put the interests of the fishermen and the plant workers ahead of those of the population, what happens is that the plant workers and the fishermen suffer more. It's been a lesson that we've learned in this crab management process, that you have to look after the stock first, if you're going to have the possibility of looking after the fishermen and the plant workers.

It's something we've certainly taken on board. We don't want to do it again in any other area; we want to keep the harvest rates within reason. We don't want to rely 100% on the fact that there's a size difference between males and females and on the idea that you can fish the males as hard as you possibly can as long as you leave the rest of the population alone. That didn't work in area 13. We don't want to take a risk in the management of crab stocks throughout Atlantic Canada. We are therefore taking the steps necessary this year to ensure that we have the stock necessary to rebuild the population in the southern gulf on the upward side of the cycle and stay for as short a time as possible on the bottom end of the cycle.

[Fin Donnelly, NDP, New Westminster—Coquitlam, BC]

Given that lesson, then, if we shift to area 12, what was the recommended scientific catch level for 2009?

[David Bevan]

The recommended levels don't come up with a number; they come up with a range and a risk assessment. Scientists are the risk assessors, and managers and the minister have to consider all of the advice in managing the risk. The risk assessment is done by science.

I can't recall the exact numbers in the scale that was provided. They don't come out with a point, as I said; they come out with a range, and they say that the low end of the range entails less risk, and here's the risk at that point, and at the high end you have more risk.

But I confess I can't recall the details of the scientific advice off the top of my head. We can certainly refer you to.... The scientific advice is on the web, and the stock status reports are there, so the committee certainly has access to the actual advice from scientists.

[Fin Donnelly, NDP, New Westminster—Coquitlam, BC]

I'd be very interested in knowing what the risk assessment and the scientific range was for last year and then why the TAC was set as it was last year versus this year, and why the drastic change in one year, when we're looking at a 10-year cycle, as you've mentioned and as we've heard at other hearings. That's something I'm certainly grappling with; it doesn't seem consistent.

I have one last question, but I guess I'll have to wait. Thank you.