Maine to boost lobster promotion funds to more than $2 million

Freshly-caught lobsters wait to be transported in this 2010 file photo.
Bridget Brown | BDN
Freshly-caught lobsters wait to be transported in this 2010 file photo.
Posted June 28, 2013, at 6:50 p.m.

AUGUSTA, Maine — With the approval of the Legislature and Gov. Paul LePage, Maine is moving ahead with plans to significantly boost the amount of money it spends each year to market its signature seafood product.

Before now, the Maine Lobster Council has had an annual budget of $350,000, which state and industry officials have said is insufficient compared to multimillion-dollar seafood marketing budgets in other states such as Alaska and Louisiana. Lobster represents by far the most valuable commercial fishery in the state, with Maine fishermen catching 126 million pounds of lobster and earning gross revenues of nearly $339 million in 2012.

The Legislature passed the bill, LD 486, early last week and LePage signed it into law on June 20.

With the passage of the bill, the promotion council will be renamed the Maine Lobster Marketing Collaborative and is expected to see its budget increase to more than $2.25 million a year within the next three years. The money will be raised through increases in licensing fee surcharges for lobster fishermen, seafood wholesalers and processors.

Some industry leaders had pushed for the state to increase the annual marketing fund to $3 million, but not all fishermen supported the idea. Jeff Nichols, spokesman for Maine Department of Marine Resources, said Friday that the $2.25 million figure was a result of a negotiation of “a fair distribution of fees” among fishermen, dealers and processors.

David Cousens, president of the Maine Lobstermen’s Association, said Friday that MLA supported the $3 million goal, but even at $2.25 million a year it will be a vast improvement over the current funding level. MLA is the largest commercial fishing industry group in the state, representing approximately 1,200 of the 5,000 or so commercial lobstermen in Maine.

Cousens said fishermen hope the increased marketing effort will boost the average annual statewide price that fishermen get paid for their catch, which sank last year to $2.69 per pound, its lowest level in nearly two decades, because of low market demand. He noted that if the average annual price that fishermen earned in 2012 had been only 10 cents more per pound, overall revenues for the statewide fleet would have been $12.6 million higher than what they were.

“We need more homes for the product,” Cousens said. “It’s an investment from the lobstermen’s perspective.”

The funding boost is seen as a way to broaden the global customer base for Maine lobster, which state and industry officials hope will help increase the value of the catch without having to increase the volume of landings. The annual volume of lobster caught in Maine has increased significantly since the late 1980s, when yearly statewide landings were around 20 million pounds. State and industry officials have credited conservation measures in Maine that include minimum and maximum harvest sizes, escape vents in traps for undersized lobsters, and a ban on keeping reproductive females for helping to maintain the size of the lobster population in the Gulf of Maine.

“The lobster resource here in Maine is the strongest it has ever been thanks to conservation measures that have been developed and support by industry,” Patrick Keliher, commissioner of the Maine Department of Marine Resources, said in a prepared statement about LD 486 becoming law. “This tremendous supply has posed a challenge and an opportunity to create new markets, both here in the U.S. and overseas.”

The new licensing fee surcharges, which go into effect this year, are expected to range from $31 for smaller-scale fishermen to $250 for dealers in the first year. The annual surcharges increase in each of the following two years and, by 2016, are expected to range from $165 for smaller-scale fishermen to $4,000 for large-scale processors. The law also increases the number of seats that fishermen hold on the nine-seat board from three to four.

The boost in marketing funds comes at a time when the industry has gone through several years of relative upheaval.

The average annual price fishermen have earned for their catch has declined markedly from the mid-2000s, when it stayed above $4 per pound for four straight years. As the price has declined since then, fuel and bait prices have increased sharply and fishermen have had to contend with new gear rules aimed at protecting endangered whales and other protected marine species, which in turn have increased their gear costs. More federal restrictions regarding lobster fishing gear and configurations that would help protect whales are being considered.

Last year unusually high landings in the spring and early summer, when demand is low and the seasonal lobster distribution network in the Northeast and Canada is ill-suited for handling large quantities of live lobster, caused the price Maine fishermen earned for their catch to sink temporarily to around $2 per pound. The low price led to blockades of imported Maine lobster in Canada, where fishermen said they could not earn a livable wage on the prices they were being offered by Canadian dealers and processors.

Despite the low price, the 126 million pounds of lobster that Maine fishermen caught and sold in 2012 is the highest annual landings total on record — nearly twice as much as the 64 million pounds the statewide lobster fleet landed in 2007. Industry leaders and regulators acknowledge that landings are bound to decline at some point, however. Boosting global demand for Maine lobster should help offset the decrease in the fishery’s value that will result when landings inevitably decline, they said.

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