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Clawing Their Way Through Rough Waters

May 20, 2009 - PORTLAND -- Last fall, many Maine lobstermen ended their season early after lobster prices tanked along with the global economy.

This spring, they're finding themselves in familiar waters.

Lobster prices are about $2 below typical prices for the spring season, which is usually a high point. And although it's too early to know what's in store this summer and fall, a surplus of lobsters in Canada and weak global demand have some nervous lobstermen and dealers cutting costs and looking for new customers.

"The price is killing us," said Peter Pray, a Portland Harbor lobsterman.

"If it's low now ... I would expect a lot of guys who don't have their boats paid for won't be in (business) next year," said Scott Kittredge, a fellow Portland-based lobsterman.

The price paid to lobstermen last week ranged from $4 per pound in Portland to $3.25 per pound Down East. Retail prices started at about $5.50 per pound for the smallest lobsters.

The lobsters on the market now are usually the most valuable of the season, both because they are in tight supply and because their hard shells mean they can be shipped live around the world as well as sold locally. When the peak summer season starts around July 4, the market is typically flooded with soft-shell lobsters that can only be sold locally, bringing the price down by as much as $2 a pound.

As long as the current trends hold, retailers said, consumers will continue to enjoy the kind of reduced prices that had them lining up at fish markets last fall.

"Lobsters are going to be as cheap as ever this year," said Joe Ray, owner of Free Range Fish & Lobster on Commercial Street in Portland.

Some dealers warned, however, that it's too early to predict what could happen this summer because so much depends on the weather, the economy and the strength of the tourist season.

Lower fuel prices will help contain costs, and also will attract more tourists, said Allen Daggett, owner of Cape Porpoise Lobster Co. in Kennebunkport.

"I think that we're going to have a good season," Daggett said. "I think that from all indications, the fishermen are going to catch quite a few lobsters. (And) you'll see tourism at least as good as last year, if not better."

The global economic crisis last fall sank wholesale lobster prices to $2.25 in some parts of the coast, the lowest price in more than a decade. And, while Maine lobstermen last year caught 3 million more pounds of lobster than the year before, their sales fell by nearly $50 million to $235.6 million, according to the Maine Department of Marine Resources.

The market collapse last fall led Gov. John Baldacci to create a task force to study the economic sustainability of the industry. The group is expected to issue recommendations later this month.

Peter McAleney, owner of New Meadows Lobster in Portland, suggests a statewide lobster bake.

"I want a new holiday in August," he said. "Call it Tourist Appreciation Day or some freakin' thing."

Most of Maine's 6,000 lobstermen are just now setting out traps to prepare for the peak summer season. Those hauling spring lobsters are earning relatively little profit because of the price and the smaller catches at this time of year, said Patrice McCaron, director of the Maine Lobstermen's Association. Some are now working alone rather than paying a helper to empty and bait the traps, she said.

"I don't think it's a crisis, but people are really digging into their books and looking into their operations to figure out how they can cut corners and keep their businesses operating," McCaron said.

Pray, the Portland lobsterman, said his bait, fuel and helper cost him more than $400 a day.

"I've got to catch 100 pounds before I make a dime," he said. Although catches vary, a good day at this time of year could yield about 200 pounds.

The greater volume of lobsters typically landed in July and August will help lobstermen get by, as long as prices don't fall too low, McCaron said. "The tourist season will hopefully keep us in that $3 (per pound) range, which will be OK," she said.

The lobster market's continuing struggle is especially troubling Down East, where prices are generally lower and the industry is the largest employer.

"It's a consistent topic of conversation. It's the biggest one on the bill," said Steve Robbins, manager of the Stonington Lobster Co-op. "It's the number one thing right here. There are no other economic opportunities for these people on this island."

A huge glut of lobster in Canada is causing the most concern.

Canada's processing industry, which freezes lobster tails and sells them around the world, had bought more than half of the Maine catch in past years. Now it can't sell what it already has in the freezers and is no longer able to buy up the Canadian catch, let alone the Maine catch.

Canadian lobstermen are getting paid just $2.50 per pound in U.S. dollars, and last week organized a four-day strike in Newfoundland to draw attention to the plummeting price.

"You can get trailer loads of (Canadian) lobsters delivered here cheaper than I can buy from a boat in Portland," said Brendan Ready, co-owner of Ready Seafood in Portland. Local dealers who used to compete to buy lobster off the boats now don't want to get stuck with lobster they can't sell, he said.

Ready is trying to expand his market and recently went to Europe, where seafood companies said they already had more lobster than they could sell, he said.

"Every other lobster dealer is doing the same thing I am," he said. "You're going to go by survival of the fittest. Some of the wharfs that buy lobsters now are not going to buy lobsters next year. … It's the same with lobstermen. They're going to take a massive pay cut."

Ready hopes Mainers and tourists will buy enough lobsters to keep the market from tanking in the summer. But, he said, the same reputation that sold a lot of lobsters in the good times is clearly hurting sales in a no-frills global market that favors austerity.

"Everybody's looking for the deal," he said. "Unfortunately, over the years we've created a brand for lobster as a luxury product, and we've done a really great job at it."

By JOHN RICHARDSON, Staff Writer, Portland Press Herald, May 15, 2009


Lakes:
Regions: Sebago, Sanford, Mid Coast, Downeast


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