Evidence of meeting #78 for Fisheries and Oceans in the 41st Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was product.
A recording is available from Parliament.
Executive Director, Lobster Council of Canada
Virtually all of the harvesting associations pay dues based on their membership, so it's about half and half between the companies and the harvesters. Last year, we raised $50,000 in dues. This year, our goal is $100,000 in dues, and it's roughly 50-50.
Liberal
Lawrence MacAulay Liberal Cardigan, PE
Thank you very much.
On the 2009 report we discussed yesterday—and you have a lot of reports—those recommendations made by this committee.... I think one of the recommendations was that you be established, which I expect you wouldn't be opposed to, but they did follow through.
Are there any other recommendations in that report that you think the government should follow through on? I'm thinking about the fishers providing assistance to the lobster fishermen to reduce their costs. Has the government gone through with that?
Could you comment on when they charge for tags and the log books and this type of thing? Could you elaborate on that? The problem we have in the inshore lobster fishery in Atlantic Canada.... With the situation as it stands, they're going to have a very difficult job surviving at that price.
Liberal
Lawrence MacAulay Liberal Cardigan, PE
Do you believe that the government has implemented enough of this study?
Executive Director, Lobster Council of Canada
I can't really speak to the tags and the log books because we don't get involved in that side of the house. We stay away from resource management issues, in general. We leave that to the harvester groups, and they like it that way. We try to stick to marketing, market access, marketability.
The plan and the strategy were developed by the industry, and governments have helped us where they've been able to. We're getting better at understanding how to go after grants and money. There's an art to that. Everybody knows that. The money is there, the programs are there, but you have to go after them. So we're getting better at that.
In general, the governments have supported us fairly well, but you'd have to give me a specific question.
Liberal
Lawrence MacAulay Liberal Cardigan, PE
I was as specific as I could be. When you increase the cost, now you're not going to be opposed to your own establishment but you're going to be.... I was just thinking that with the fishermen and the situation they're in.... Anyway, we can drop that.
You've indicated clearly that the size of the lobster is not the issue, it's the quality of the product itself. That's quite important where I come from.
Before the change in the dollar, what was the value of the product?
Executive Director, Lobster Council of Canada
That's a great question. If you look at that data sheet that I sent you, it's very instructive on how the dollar change impacted the industry. Back when we had a $1.40 or $1.50 dollar, I had a trading company at that time. I can tell you it was wonderful times for all Canadian products. The shore prices basically go in lockstep with the dollar change. You could fall out of bed in the morning and make money on lobster when we had a cheap dollar, because you could buy it for $6.00 from a harvester and you could sell for $6.00 U.S. in Boston and make $1.50. Now we have to make it on proper business practices. Taking a look at the dollar is dramatic.
If you look at the last year that we had a $1.20 dollar, that was the last year we had a $6.00 shore price. The strength of the dollar mirrors the shore price difference.
Liberal
Lawrence MacAulay Liberal Cardigan, PE
It seems to me that, as you've indicated quite clearly, sometimes there's a large amount of lobster on the market, and then there are times that we do not have lobster at all. You've touched on the grading and the branding, but what about if you had holding tanks? Would you suggest that there should be cooperatives involved in this with the fishery involved?
What way do we do this to make sure that we have an orderly marketing plan? What we want to do is get the best dollar out of the lobster, year round. From what I understand, we're not doing that. But you're telling me, if I understand you correctly, that we could if we had an orderly marketing system. Could you elaborate?
Executive Director, Lobster Council of Canada
Today there is a very active inventory management sector of the industry, which I didn't talk about. There are companies that buy lobster during their peak time and put them away and then release them to the market when it's to their advantage. It happens every day. In Nova Scotia, there are holding facilities above ground, in reservoirs, and in the ocean. In New Brunswick and I think on P.E.I., they've tried it. So it happens today. That's very much a part of the marketing strategy. To have lobster the year round, you need to hold them.
Liberal
Lawrence MacAulay Liberal Cardigan, PE
Would it be fair to say that they're buying lobster when the market is glutted? This is a business practice. I'm not condemning anybody. But then they have the lobster in the holding tanks, and they're able to retail the lobster later at a much larger price. Would you suggest that or not?
Executive Director, Lobster Council of Canada
These are live shippers who are keeping their market happy during times of no product or during times when product has just landed that isn't acceptable to ship. It's definitely a marketing strategy. It's a sales strategy. Sometimes it works, sometimes it doesn't. Last year, after the spring season, there were massive mortalities in the holding systems because of the quality of the lobster, and because of the water temperature. That wasn't a great time to be holding lobster. Sometimes it works, sometimes it doesn't. Sometimes the market goes up, sometimes it doesn't.
Liberal
Lawrence MacAulay Liberal Cardigan, PE
There was a suggestion by some people that we need to hear from more people other than yourself. I'm pleased you're here. I think I said that. I recommended that you be here. I think I told you that yesterday. Do you feel that we should hear from other sectors involved in the fishery in order to establish where we are and just what is going on? Do we need the producer of the product itself, the people who handle the product? Do you feel it's of value for this committee to hear from these people and find out just what is going on?
For example, we hear that Red Lobster hasn't changed the price—personally, I do not know—from the time the lobster price was high. We're in a free-market situation and it's fair for them to do that if they want. Do we need to go farther with this committee in order to find out just exactly where we are, and what the retail of the product is? For the person consuming the product, has the price changed much since the fishers were receiving a large price, excluding the change in the dollar? Do we need to deal with that?
Liberal
Lawrence MacAulay Liberal Cardigan, PE
In order to find out just exactly what is going on, if you could ever find out what's going on...and, of course, I realize we're in a free-market situation....
Liberal
Lawrence MacAulay Liberal Cardigan, PE
I was just trying, Chair, to be sure that he understood exactly where I was coming from.
Conservative
Executive Director, Lobster Council of Canada
I don't know the mandate of the committee. I don't think it could hurt to have the harvesters or the shippers or processors here to give you their side of the story. I would just reiterate that we've done that. We've been talking among ourselves for three-and-a-half years. We know basically what the challenges are, but that's up to you. I think they'll tell you what I'm telling you, because what I'm telling you is what they tell me around our tables every day. But that's up to you.
Conservative
The Chair Conservative Rodney Weston
Thank you very much.
We'll now move to a five-minute round, and we'll start off with Mr. Donnelly.
NDP
Fin Donnelly NDP New Westminster—Coquitlam, BC
Thank you, Mr. Chair.
Thank you, Mr. Irvine, for being here.
It sounds like in your message you have clearly presented information to us. You asked how the federal government could help. You emphasized that marketing through other jurisdictions is key. You pointed to Alaska, Norway, so obviously, this development of a levy system to fund and promote and structure reforms is key, and supporting marketing and promotional dollars is also key.
One thing I want to turn to, though, is in your presentation I didn't hear much about the biomass. Maybe we could explore that a little bit. Would you say there are any issues with biomass in Canada, or in the United States, more specifically, given the landings you've mentioned in Maine?
Executive Director, Lobster Council of Canada
The biomass is very healthy. We have a challenge of excess, but the lobster biomass, in general, is in great shape, and we have low predation out there. Predators are absent. Herring is not there. Cod is not there. We have warming waters that are moving the lobster body more north and I think impacting the proliferation of lobster. We have bigger and more powerful boats to catch more lobster.
We work very closely with the DFO biologists all the time, and I sit in on meetings of the advisory boards for all the different areas and meet with the harvester associations. Of course, there are some areas where there are some challenges in the gulf, a couple of spots, but in general, the biomass seems to be very healthy.