New lobster processor hopes to help bring economic stability to Schoodic area

A new sign with the name of the new owner of a longtime seafood processing plant in Gouldsboro sits in front of the plant's iconic, 40-foot tall fisherman. Maine Fair Trade Lobster officials say they plan to boost the number of employees at the plant by 50 percent this year for a total of nearly 200.
Bill Trotter | BDN
A new sign with the name of the new owner of a longtime seafood processing plant in Gouldsboro sits in front of the plant's iconic, 40-foot tall fisherman. Maine Fair Trade Lobster officials say they plan to boost the number of employees at the plant by 50 percent this year for a total of nearly 200. Buy Photo
Officials with Maine Fair Trade Lobster in Gouldsboro plan to increase the number of the processing plant's employees by 50 percent this year to a total of nearly 200.
Dave Cleaveland | Maine Fair Trade Lobster
Officials with Maine Fair Trade Lobster in Gouldsboro plan to increase the number of the processing plant's employees by 50 percent this year to a total of nearly 200.
East Coast Seafood president and CEO Michael Tourkistas.
Bill Trotter | BDN
East Coast Seafood president and CEO Michael Tourkistas.
Posted May 05, 2014, at 3:56 p.m.

GOULDSBORO, Maine — For the past year and a half, two regional seafood distributors have been working together to create the largest lobster processing plant in the state.

And much to the relief of local residents, the two have been doing it quietly, with little fanfare or drama.

Maine Fair Trade Lobster, a partnership between East Coast Seafood and Garbo Lobster, is expanding its operations and finishing up about $3 million worth of renovations at the former Stinson Seafood cannery. In early May, the company plans to resume production at the plant with nearly 200 employees, roughly 50 percent more than the 130 workers it employed last year.

“This is a huge undertaking,” Michael Tourkistas, president and CEO of East Coast Seafood, said recently in one of the few interviews he has given since his company became a co-owner of the plant more than a year and a half ago. “It takes a lot of experience to navigate through the ups and downs.”

It is not clear to what extent the jobs in Gouldsboro are expected to be seasonal. Most Maine lobster processing plants greatly reduce production, or close down altogether, in the winter when the state’s lobster landings slow to a trickle. But Tourkistas said he hopes to coordinate the facility’s operation with its sister Paturel processing plant in Deer Island, New Brunswick, where the Canadian lobster season occurs in the winter.

From 2010 through 2012, Gouldsboro had a steady diet of angst and apprehension as the ownership and continued operation of the longtime seafood processing plant in the local village of Prospect Harbor came into doubt.

In February 2010, Bumble Bee Foods decided to shut down the former Stinson Seafood plant, which was the last sardine cannery operating in the United States, putting nearly 130 people out of work. After moving the canning equipment across the border to its Connors Bros. subsidiary in Blacks Harbour, New Brunswick, and spending months searching for a new buyer, Bumble Bee found one: an upstart lobster distributor from Chelsea, Massachusetts, that was looking to break into the processing business.

But Live Lobster’s arrival in Gouldsboro was met with mixed reactions.

Some people were happy to have a new owner for the plant who, though not interested in sardines, was hoping to start up a lobster processing operation that would provide jobs to Schoodic Peninsula-area residents. Others were worried that Antonio Bussone, the president of Live Lobster, was trying to bite off more than he could chew and wouldn’t make good on promises he was making to the community.

Live Lobster asked town officials to endorse its application for a $400,000 federal grant, but selectmen balked, saying they wanted assurances about the company’s financial resources. Those concerns appeared to be justified months later when, in December 2011, checks issued to fishermen by the company began to bounce.

Live Lobster’s tenure in town didn’t last much longer. The fishermen were paid, but in early 2012, Live Lobster’s checking accounts were frozen, and the company was sued in separate lawsuits filed by its bank, TD North, and by a former employee. With no cash flow, operations at the plant shut down. That fall, the plant was put up for sale at a foreclosure auction.

That’s when East Coast Seafood and Garbo stepped in, acquiring the 100,000-square-foot plant with a top bid of $900,000. Tourkistas said the two firms had been interested in the plant when Bumble Bee was selling it two years earlier, but the timing for them to buy it “was not right.”

East Coast Seafood and Garbo, based in Massachusetts and Connecticut, respectively, are big players and longtime competitors in the lobster distribution business, but each saw an opportunity in partnering in a new lobster processing plant, according to Tourkistas. Through its Paturel plant in New Brunswick, East Coast Seafood already had experience in the processing sector. But as a global distributor of lobster, it has bought mainly from smaller dealers spread throughout coastal New England.

Garbo, Tourkistas explained, has more direct access to fishermen, which is key to starting up a new processing plant. When it comes to buying and selling a limited perishable commodity such as lobster, it can take years to develop business relationships and supply chains, he said. Any new large-scale processing plant has to have established access to an ample and steady supply of lobster and Garbo’s partnership in the Gouldsboro endeavor has made that possible, he said.

The higher volume of Maine’s annual lobster harvest has helped open the door for expansion in the state’s processing sector, according to Tourkistas. The total amount of lobster caught in Maine has increased from less than 70 million pounds in 2008 to nearly 126 million pounds last year.

Boosting demand for live lobster, which is tricky to transport over long distances, is a steep challenge, he said, but processed products are easier to ship and have a longer shelf life. Maine Fair Trade Lobster is taking a cautious approach, he added, to ensure the plant still will be viable if landings decrease, as many industry officials say they inevitably will.

“Landings in Maine have increased dramatically the past few years,” Tourkistas said. “That creates opportunity for additional [processing] capacity.”

Last summer, Maine Fair Trade Lobster got off the ground after some minor upgrades to the plant. With 130 employees — roughly the same number Bumble Bee employed at the end of its run — the firm processed 4 million pounds of lobster by the end of 2013. Most of its processed products, he said, are sold to food service companies.

This year, it is making more significant upgrades. With a $500,000 federal grant — fully supported by Gouldsboro selectmen — and $2.5 million in financing from Machias Savings Bank and Coastal Enterprises Inc., it is increasing the number of the plant’s processing lines and storage capacity for live and frozen lobster.

The goal this year, Tourkistas said, is to double the plant’s 2013 output to 8 million pounds of processed lobster.

“I think that would put us as the number one processor in the state,” he said. “[And] we could potentially grow up to 300 employees in the next two to three years.”

The company is accepting online job applications for the 2014 season, Tourkistas added.

Area residents said this week they are hopeful this time around that operations at the plant have a long-term future.

Keith Young, who lives in neighboring Winter Harbor, said Thursday that area residents have been more at ease about the plant’s prospects since it was bought by the new owners.

“We all knew the other one was bad,” he said, referring to Live Lobster.

Sarah Christensen, who co-owns Nautica Pub in the local village of Birch Harbor, said she got business last summer from plant workers on lunch breaks or after their shifts.

“They come over for takeout a lot,” she said. “It’s definitely good for business to have job opportunities [in the area].”

Karin McLean, who with her husband owns and operates Mc’s Market across the street from the pub, said reopening the plant means a lot to the local economy. She added she has not heard as much “ruckus” about the plant in the past 20 months as she did in 2010 and 2012.

McLean said her store historically has gotten a decent amount of business from the plant’s workers. With the added potential of a new campground under construction in Winter Harbor, the Schoodic area’s economic outlook seems to be improving, she said.

“It’s been a long, slow winter,” McLean said. “I think most people are glad to see [the seafood plant] is operating again.”

 

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