July 16, 2012 — Some Fishermen Keep Boats in Port; Outside Maine, No Drop for Consumers
"I've never seen them tie up [their boats] as a group like this before," said Randy Johnson, manager of the Winter Harbor Lobster Co-op. The 30 vessels in his co-operative have remained in port for a week straight.
"I'm looking at all their boats as we speak," he said Friday when reached at the co-op, which sits across the bay from Bar Harbor "They all have a cut-off point [in price] where they can and can't fish," he said. "It's an impossible situation."
Lobster prices at the dock have fallen to as low as $1.25 a pound in some areas-roughly 70% below normal and a nearly 30-year-low for this time of year. Jerry DiColo joins Lunch Break to explain why. Photo: Matthew Healey for The Wall Street Journal.
Harbors up and down the coast of Maine are filled with idle fishing boats, as lobster haulers decide that pulling in their lobster pots has become a fruitless pursuit.
Prices at the dock have fallen to as low as $1.25 a pound in some areas—roughly 70% below normal and a nearly 30-year-low for this time of year, according to fishermen, researchers and officials. The reason: an unseasonably warm winter created a supply glut throughout the Atlantic lobster fishery.
Those prices have officials and lobstermen concerned about the fate of one of the state's most vital industries. "For some people it will be disaster, they are going to go bankrupt," said Bob Bayer, director of the Lobster Institute at the University of Maine.
Retail lobster prices in Maine have started to fall along with the glut, and Mr. Bayer said that some fishermen have begun selling lobsters out of their trucks for as low as $4 a pound. But consumers elsewhere in the U.S. aren't likely to see bargains. The Maine lobsters that currently are in season can't be shipped long distances due to their soft shells, and retailers have other fixed costs that limit big price drops.
"There could be a small effect, but I wouldn't expect much," Mr. Bayer said.
Lobsters are a $300-million-a-year industry in Maine, according to Halifax, Canada, consulting firm Gardner Pinfold. Along with Canada, Maine's thousands of independent lobstermen supply the vast majority of the world's clawed lobsters, which have seen a population boom over the past three decades due to rising water temperatures and overfishing of cod and haddock, their main predators.
Profit margins are low even in good years, but this summer the problem has intensified. The wholesalers that buy directly from lobstermen are paying less than it costs for many boats to turn a profit.
Read the full story in the Wall Street Journal