Sensationalism, myth, price fixing, a devastatingly high exchange rate and windfall prices are some of the characterizations being bandied about in the first weeks of the spring lobster fishery in Prince Edward Island.
When early spring stories in a PEI newspaper spoke of exorbitant prices and a shortage in supply of lobster in the US, PEI lobster fishermen were hopeful for high demand and high prices.
The reality is that prices are the same as last year and fishermen are furious. Angry over the idea that processors may be cashing in on U.S. prices, island fishermen have accused the processors of price fixing. Lobster is fetching $5 (a pound) for canners and $6 for markets, in most cases, and catches are averaging 600-800 pounds. Canners make up a big part of the fishermen’s catch and once banded will fetch another 25 cents.
Buyer/contractor Terrance MacDonald, owner of Savage Harbor Fisheries, says he believes all this high-price hype is sensationalism and a myth.
MacDonald buys direct from fishermen off the wharves and sells to processors. He says buyers have to compete with each other, therefore they all pay same price. As far as he’s heard (about high US prices) there was about 200 pounds of lobster sold at $15 a pound during the spring shortage in the U.S. “And that’s it,” he says.
Ready to defend the position of buyers, MacDonald says, “We are really just truckers, when is comes down to it.” He adds that buyers have their expenses as well as the fisherman and he does a fair share of negotiating with processors. “I have to negotiate and get paid the same as buyers anywhere.”
Figures suggest that the shortage of lobster meat in the U.S., due to poor winter and spring catches, continued to drive prices up.
Manager Steven DiMillo of DiMillo’s Floating Restaurant in Portland, paid as much as $56 a pound for lobster meat at the end of April.
However, MacDonald justifies that.
Getting enough lobster meat to make up that pound of meat would mean about 4 pounds of live lobster, he explains. Hence, he questions angry reactions to the price fixing debate.
Despite the shortage of live lobster and/or meat in the U.S., Peter McAleney of New Meadows Lobster in Portland says he has been unable to get live PEI lobster for a couple of years. “They have great lobster but we haven’t bought any in a couple of years. I’d like to get some, but the PEI lobster is all gone to processed meat,” he says.
DiMillo has the same story and he and McAleney agree they would like to be able to buy from PEI, but product (for them) just has not been available. DiMillo indicated that he had not been interviewed by any PEI newspaper and McAleney did not comment on the April stories.
Michael MacInnis, executive director of the PEI Seafood Processors Association, noted in the PEI news stories that he believed the price spikes in the U.S. were an anomaly that was related to a live market lobster shortage. He cites three reasons for the prices being offered to fishermen. “Lobster meat prices are $2 to $3 below last year’s, the exchange rate is devastatingly high and the demand for lobster [meat] is decreasing overseas,” he said.
All this contradictory information has the executive director of the PEI Fisherman’s Association, Ed Frenette, declaring a price war. He insists that market intelligence shows clearly United States and Upper Canada are still crying for more lobster. Frenette stressed that that lobster pounds in these areas were empty due to minimal winter and spring catches in Maine. He says demand is still strong in Europe and in recent news story in the Guardian newspaper (in Charlottetown PEI) offers these comments:
“We strongly believe that processors are shipping to the live market in the United States and Canada and not compensating fishermen accordingly. They are making windfall profits,” states Frenette, adding that during the second week of the PEI season in May, brokers were offering five-pound bundles of PEI lobster (four 1.5 pound lobsters) in Ontario for the wholesale price of $134 plus freight, guaranteed live shipment. “That’s $33.50 per lobster.”
Prince Edward Island’s biggest processor of lobster, Ocean Choice in Souris, offered no comment on whether or not they are taking advantage of this shortage in the U.S. by shipping in lobster. This could be true; Frenette insists that large U.S. chain restaurants are saying they can’t find enough (lobster) to meet demand.
“If this isn’t enough to increase prices, what is?” said Frenette.