State, industry gear up to meet lobster crisis

By Rich Hewitt, BDN Staff
Posted Oct. 24, 2008, at 9:07 p.m.

ELLSWORTH, Maine — As the boat prices for lobster inched higher this week, state and industry representatives were trying to put together long- and short-term programs to aid fishermen and the beleaguered lobster industry.

Gov. John Baldacci on Friday signed an executive order establishing a task force on the Economic Sustainability of Maine’s Lobster Industry. The task force will review Maine’s lobster industry and recommend strategies to help maintain its viability.

The order calls for the recommendations to be made by April 2009.

“The lobster industry — including the fishermen, dealers, processors and associated businesses — is absolutely crucial to Maine’s economy and heritage,” Baldacci said in a press release. “We must make a thorough review of the industry in light of the current global economic, financial and energy challenges in order to ensure its long-term sustainability.”

Among the targets of the task force is identifying opportunities for expanding and diversifying live and processed markets for Maine lobster, increasing product quality and profitability, and expanding marketing initiatives.

Following a Baldacci directive issued a week ago, the state departments of Marine Resources and Economic and Community Development, along with the state’s financial and business agencies, will meet next week with lobstermen throughout the state.

According to David Etnier, the deputy marine resources commissioner, the group will meet Monday with the Lobster Advisory Council and then will meet individually with the state’s seven lobster zone committees over the next seven working days.

Etnier said he has asked chairmen of the different zones to encourage the bankers in their districts to attend these sessions.

“If fishermen have loans for their boats, their trucks or their homes, they’ll be able to talk with local bankers about restructuring those loans,” he said.

Despite a slight rise in lobster prices this week, fishermen are still reeling from the October crash that dropped the bottom out of the market just at the time of year when lobster fishermen catch the most lobster and earn the money they need to make it through the winter months when they aren’t fishing.

Many could have trouble making boat and bill payments this winter, said Bob Baines, a lobsterman from Spruce Head.

“The trickle-down of this will be very difficult because the tens of millions of dollars that will be lost won’t be pumped into the local economies,” Baines said. “That’ll have an effect on small communities up and down the coast.”

Maine banks may be able to work with fishermen to provide them with some short-term relief.

“Lobstermen are very independent; they don’t want a handout,” Jim Nimon, director of the state office of business development, said this week.

But, he said, there may be ways to help struggling fishermen make it through the winter.

“Based on my discussions with banks in Maine, there is cash available,” he said. “The Maine-based banks were not linked into the craziness on Wall Street. They may be able to help the fishermen with restructured debt, extended terms or lower payments. That could help them in the short term.”

Lobster prices tanked earlier this month as money-strapped consumers’ interest flagged and Canadian processors held back ordering in reaction to the global financial crisis. About 70 percent of the lobsters caught in Maine are shipped to Canada for processing at this time of year, but those plants, flush with a stock of lobster from a good spring catch and strapped for cash because Icelandic banks crashed in the financial meltdown, are not buying.

Canadian lobster fishermen will begin their season within the next few weeks, which will add more lobster to the over-stocked market.

The boat price for lobster — the price paid to the fishermen — varied based on different payment methods used by dealers. In some areas this week, the boat price was as high as $2.80 a pound. The price at the Stonington Co-op was up a quarter from last week to $2.25 a pound for run lobsters and $4.25 a pound for selects, according to co-op manager Steve Robbins. But at that price, lobstermen are getting just a little more than half the price they got during peak season last year.

“It’s a little better than it was, but it’s still a very difficult situation for a lot of people,” Robbins said. “This is the time of year when people could be making some decent money, and the majority are not able to. There’s a lot of uncertainty and that’s the worst part. It’s like the stock market. Nobody really knows where the bottom is or if we’ve hit bottom.”

Along the Portland water-front, retail seafood shops are selling lobsters for as little as $3.89 a pound, which is about the price of bologna at the deli counter.

“This is as devastating to the state of Maine as Hurricane Katrina washing away all the boats and blowing down all the wharves,” said Dana Rice, a lobster dealer from Gouldsboro.

While experts agree that little can be done in Maine to remedy the world financial situation, efforts are under way to try to open up a market for lobster that are still being caught.

The Maine Lobster Promotion Council has bought radio ads urging people in Maine to buy lobster and has developed promotions with Hannaford and other supermarkets and restaurant chains in the Northeast to help sell more lobsters.

The University of Maine Lobster Institute has teamed up with Lobster Gram, the largest Internet marketer of live lobster, to offer discounts on live lobsters of up to 50 percent. A portion of the sales will help to support the institute’s sustainability efforts.

Dr. Robert Bayer, the institute’s executive director, said the discount sale was a way to help broaden the market for lobsters beyond the Northeast.

“A lot is being done in New England,” Bayer said. “This is a chance to move some lobsters nationally.”

In addition, the institute and the food services and human nutrition departments at the university recently developed a method of freezing lobster, Bayer said. The option of freezing lobster might stimulate local consumer purchases, he said. The institute plans to post that process on its Web site next week at www.lobsterinstitute.org.

Other efforts are under way up and down the Maine coast. Penobscot East Resource Center is ready to distribute the funds raised at a community lobster dinner in Stonington. According to PERC Executive Director Robin Alden, the organization will distribute $1,000 raised at the Oct. 5 event.

“The funds will be distributed as a credit at local gas stations to everyone who was fishing the week before Oct. 5,” Alden said. “It will just be a token. How much will be determined by the number of fishermen who were fishing.”

Similar events are being held at other coastal communities, including a merchants lobster giveaway in Rockland today.

The state also may be able to help expand the market in the short term to deal with the overabundance of lobster, according to Nimon. He noted that a lot of ideas were floated last week at an industry meeting called by Marine Resources Commissioner George LaPointe, including petitioning the federal government to purchase lobster to feed the troops and developing increased processing capacity in Maine.

“That is the kind of ‘out-of-the-box’ thinking we need,” Nimon said. “A lot of ideas sprang up quickly, and I don’t think we can throw out any ideas yet.”

Nimon said he was optimistic that some of these ideas could be developed quickly and could help fishermen in the short term.

As the state focuses on a long-term review of the lobster industry, Republicans U.S. Sen. Olympia Snowe and state Sen. Kevin Raye from Perry are organizing a meeting of representatives from the industry and federal agencies. The goal of the meeting, which will include representatives from the Small Business Administration, the Department of Commerce, the Department of Agriculture Rural Development and the Maine Manufacturing Extension Partnership, is to address methods of supporting the lobster fishery and to develop methods to encourage lobster-processing facilities to return to the state.

“One of the major contributing factors to the current collapse of lobster prices has been the lack of processing infrastructure here in Maine” said Snowe, who also is the ranking member of the Senate Small Business Committee. “By encouraging domestic value-added processing of Maine’s signature seafood, we will reduce the fishery’s reliance on volatile foreign financing and bring new jobs to the state”

Processing likely will be part of the discussion next week when the Lobster Advisory Council meets. In addition to looking at immediate financial assistance, councilors will begin to review the structure of the lobster industry including markets, the season, landings and product.

“We’ve seen now how the global economy affects every-thing. We may need to think about the markets, more value added, best management practices and promoting the Maine brand and sustainability,” Etnier said. “It may be time to look at all aspects of the industry and how to best position it for future, long-term sustainability and profitability.”

The Associated Press contributed to this report.

rhewitt@bangordailynews.net

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http://bangordailynews.com/2008/10/24/news/state-industry-gear-up-to-meet-lobster-crisis/ printed on August 27, 2014