Fisheries Committee on June 18th, 2013

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Okay, thank you.

Mr. Burns, you talked about the Atlantic lobster sustainability measures being affected in terms of reducing effort, but at the same time the commentary in the presentation was that our landings are increasing to being stable. In spite of the licence buyback, we still seem to be looking at a supply situation that is going up. Is that because of the nature and the structure of the fishing industry? Is it because of better boats or bigger boats? What's driving the supply side of that?

[Adam Burns]

Certainly there is an increase in the size of vessels in some areas. The way that the lobster fishery is currently managed is by effort-based management, so the department limits the fishing season and the number of traps, as well as taking some measures around the specifics of the trap itself. It is still possible for a harvester—certainly in a situation of high abundance of lobster in the fishery especially—to have similar or even higher landings than in previous years even if they're using fewer traps. In the current management approach I think that is in fact what is going on. The abundance of lobsters is resulting in a higher catch per unit of effort in the fishery and, therefore, the landings are staying the same or increasing as a result.

[Kevin Stringer]

Regarding that catch per unit of effort, there are two things we measure as a surrogate for abundance: one is landings and the other is catch per unit of effort. What we are seeing on average is more lobster in the same number of traps. So they're catching more lobster. But we're also seeing, as Adam said, more powerful boats, which are getting out there faster to the grounds. You take those things together and you are seeing a significant increase in effort in some areas.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

That leads me to my next question. Has the department looked at managing the fishery any differently? Could the supply and demand be managed by staggering landings? Could this be done so you wouldn't end up with gluts on the market, or what we had last year with Maine competing with New Brunswick?

[Kevin Stringer]

We have a number of management measures in place. Adam can speak a little bit about how we might manage it differently, or what we've looked at.

I will mention one thing, though, and it is the application of the precautionary approach. We have that as an objective for all of our fisheries. It's particularly tricky in lobster because there isn't a total allowable catch. But we have some surrogates. We've established some levels to see whether a fishery is in the healthy zone, the cautious zone, or the critical zone. We're determining it in most areas based on a median from the years 1985 to 2009, or maybe it's 1995 to 2009. Whatever the median is, we have an objective. The healthy zone is 80% of that or more, cautious is between 40% and 80%. As long as it's in the healthy zone, we're comfortable with the current management measures. Most of them are in the healthy zone. If you get into the cautious zone, that's when you start looking at some different approaches. So right now that's one that we're trying to apply in the lobster fisheries to give us a signal of when we have to move the dial on some of those things from a conservation perspective.

Adam.

[Adam Burns]

As to the notion of fishing to market, meeting market demand as opposed to exceeding it, there are a number of tools that I think industry could avail themselves of that the department could play a role in. There are also some tools that industry is in fact availing themselves of that don't really involve the department.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Could you be more specific?

[Adam Burns]

In respect of departmental measures—and we've indicated an openness to looking at changes to these—the first is season dates. The fishery doesn't open at the same time across Atlantic Canada and Quebec. It is already staggered. Part of the reason for the staggering is to spread out the supply of lobster. Another big part of the reason is to match the fishery with an appropriate time related to the biology of the stocks in those areas. That's one measure that spreads out the catch across most of the year.

Other measures include looking at differences from the way we currently manage, which is a limit on the number of traps. We've indicated our openness to considering other approaches, which include boat quotas or assigning specific landings to individual harvesters. But those changes wouldn't be typical for the department to bring in without a specific request from the industry.

As to things the industry can do, this year we've seen a number of instances where buyers, processors, and the industry have worked together to set daily catch limits. These reflect how much lobster they'll buy per harvester in order to slow the flow of lobster out of the water, into the processing plants, and on to market. So there are some mechanisms available to industry that don't involve the department. Then there are others that would require some intervention by the department. We're open to any of those interventions.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Have these people approached you about things like boat quotas?

[Adam Burns]

I'm not aware of any to date that have come with a consensus that they'd like to move in that direction, but it's something that I think more and more folks are starting to at least talk about.

[The Chair, Conservative, Rodney Weston]

Thank you, Mr. Allen.

Mr. Easter.

[Wayne Easter, Liberal, Malpeque, PE]

Thank you, folks.

It's nice to sit in at a fisheries committee for a meeting. I think it's fair to say that the conservation measures implemented as long ago as 15 years have been successful in the lobster fishery, if not almost too successful from a fisherman's point of view, in terms of pricing at the moment.

I’m probably the only one around this committee who remembers the escape mechanisms, nicknamed the Mifflin spawn scraper due to the opposition to Fisheries Minister Mifflin’s putting in those escape mechanisms. Fishermen were strongly opposed at the time, but now they think they're one of the best things ever invented.

Adam, to your comments on whether there is a crisis, I would say there certainly is at the fishermen's level. I met with a fisherman on Saturday, an established fisherman who owes absolutely no money on his boat’s gear. He said he was able to pay the fuel and pay his labour bill, but he doesn't expect to have money left over for his own labour—there's still a week left—or if he had debt, to pay it.

One of his colleagues is a young guy who paid $340,000 for a fishing boat last year. I can tell you that when the banker comes calling, asking that young fisherman…there's a very big crisis. So I want to establish that there is a crisis, and a very serious one, on the water.

Isn't the real problem this year one of too many lobsters and not enough processing capacity, and a lack of market?

[Nadia Bouffard]

Let me try that.

My first comment is that this is not a unique crisis for this year. We've seen over many years the supply glut issues of the lobster fishery. You've heard from the Lobster Council, which is looking at diagnosing the issues and trying to find some solutions. I don't think there's a single answer to the problem, and so I don't think there's a magic solution to it either.

[Wayne Easter, Liberal, Malpeque, PE]

But, Nadia, the situation this year is this. When a crisis was evident from the beginning, we have seen the federal government, instead of decreasing costs to fishermen, downloading costs to them—including gear tag charges, lack of observers. There is an endless downloading of costs by the Department of Fisheries and Oceans, by the Government of Canada, through budget cuts and everything else. These are additional costs to fishermen when they can least afford them.

You heard me talk about this 15 years ago. Why is the federal government not trying to establish some safety nets in the fishery as we have for farmers, such as AgriStability and AgriInvest? In the good years, you set money aside in some programs that are shared with government to help you in a financial crisis.

You know that in the natural resource sector you're going to have boom and bust, supply and demand, so how come, after all this time, there is no safety net program to protect the income of fishermen and their families when you have a crisis such as this? Now we're against the wall, and some people are likely going to go broke.

The second area I think the federal government has a responsibility in is not just Canadian lobster, but it's also Maine. Are there any discussions taking place with the Americans on the cross-border issue of how we feed the market rather than dump into the market?

Is there anything happening in those areas?

[Adam Burns]

As to your first question, the government certainly has made some investments recently. I referenced the Atlantic lobster sustainability measures program, which has put $50 million into the Atlantic Canadian lobster industry. It has reduced the number of licences in Atlantic Canada by almost 600 and taken 200,000 traps out of the water. That has played a significant role, and notwithstanding the crisis of the current state of the global economy and specific to the fishery, it certainly has improved the situation and was very successful in what it set out to do. It's really laid the groundwork for the industry to continue to move forward and continue to try to improve the economic situation.

Our officials in the regions have been working closely with harvesters, trying to identify the best and most appropriate way forward in their fishing areas to even out the supply, to better match supply to market demand and, therefore, to try to influence the price the markets are willing to pay for the available supply. It's an age-old supply-demand impact on price that is not unique to the fishery, let alone the lobster fishery.

[Kevin Stringer]

I would just add one point, and then I'll ask Nadia to speak to the U.S. issue.

In your assessment, isn't that really the issue? The one thing, if we look at what Geoff Irvine said to this committee, that has made an enormous difference is the Canadian dollar in this challenge, and so we don't have the levers to address these things.

We do think that the Lobster Council is doing enormously important work that will address some of these things around marketing and quality, which will help to move these things forward. We've been participating with them on those issues.

I agree with Nadia that there are no simple solutions—but we are working on a set of them.

Nadia, on the international issue....

[Nadia Bouffard]

This may not fully respond to your question, but I note that this industry, both on the processing and harvesting sides, is really a north-south fishery, a north-south industry, and that there is a lot of integration. There's a lot of dialogue taking place at the harvesting level, as well as the processing level, related to the issues, and the supply and demand particularly.

Yes, there is dialogue. There are regular dialogues as well at the government level, but it's mostly at the industry level.

[Kevin Stringer]

It's at the science level as well. When you look at some of the assessments that we've done and at the processes we've had, we invite Maine and the University of Maine scientists to participate with us. We have a lot in common, in terms of challenges.

[The Chair, Conservative, Rodney Weston]

Thank you very much.

Mr. Chisholm. We'll move to the five-minute round.

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

Thank you.

I want to get back to the role of DFO. I would agree that it's not this year's crisis, it's not a crisis just for this year, but a crisis that's been here for a bit of time.

But I do think DFO has a role to play, not just in management as it relates to conservation, but also in the whole role of marketing and management in the business model. I say that because DFO does make some important decisions that affect the business model.

My colleague just mentioned all the downloading that's happened over the last couple of years, in terms of picking up the costs of tags, licensing, observers, and increasingly science. These costs are downloaded onto the harvesters. The harvesters even came together as one and asked the minister to give them a year as a transition period, and the department wouldn't hear anything of that.

You're already making decisions that are affecting the business model. Why are you not more involved in the industry's attempt to find answers to the low prices? Whether it be carapace size, or assisting the Lobster Council trying to access a levy, just as the State of Maine collects a levy for its fishery and its lobster fishermen, it seems to me that there's more the Department of Fisheries and Oceans could be doing in a positive, constructive way, as it relates to the current problems of pricing, than it is.

[Kevin Stringer]

I'll start. Certainly in terms of the Department of Fisheries and Oceans' role with respect to the fisheries, as we've said in the past our primary focus, the bottom-line focus, needs to be on ensuring that the resource is there now and for the future.

That said, if you look at our prime objectives, they do speak to there being economically prosperous maritime sectors. We are concerned to ensure that the fishery is economically prosperous, and we do what we can.

Adam already spoke to the issue around working with industry and ensuring that we've got some consensus from industry at a timely point to be able to make adjustments—and we have made adjustments that speak to market.

The one thing I do want to touch on—and I'll ask Nadia to speak to it—is our role in marketing. I will say first of all that we are engaged with the council on all of these things. What's neat about the Lobster Council is that it brings together the harvesters, processors, distributors, buyers, and retailers. It also brings together the provincial governments and the federal government. We are all at the table talking about these challenges. It is a unique forum to be able to do that.

In terms of marketing, and I think—

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

They don't have the resources, Kevin. Sorry to interrupt you, but they don't have the resources to carry out what it is they need to do.

[Kevin Stringer]

As Nadia pointed out, we have provided resources and we have talked to them about becoming self-funding, and they've gone a long way toward addressing the self-funding issues.

But we do also have another department that is responsible for the marketing side of things, the Department of Agriculture. I'll ask Nadia to speak a little bit to that responsibility. Plus they've done a lot of work with the council as well.

[Nadia Bouffard]

Yes, the issues at stake can involve the role and the responsibility of different people on the value chain. The governments are one, and DFO is one, as are the industry—both on the processing and the harvesting sides—and the distributors, and so on. Everybody can play a role. I said there was no magic bullet or magic solution to this since you really need to look at this in a comprehensive way and look at the roles and responsibilities across the value chain. As Adam pointed out, Fisheries and Oceans Canada has put in place measures that have influenced and helped in terms of the seasons, and closures to address the supply and glut issues.

Agriculture Canada has a role with respect to food, market access, and food marketing. Since the mid-1990s, that has included seafood. So they have a role and they also sit around the table with the lobster industry together with the Lobster Council. Everybody sitting across that seafood value chain can play a role—but within the scope of their responsibilities.

So we're not saying that we can't do anything as a department, but we do have a role and mandate, as Kevin pointed out.

[The Chair, Conservative, Rodney Weston]

Thank you very much, Mr. Chisholm.

Ms. Davidson.