Saving Seafood

WALL STREET JOURNAL: Trump Boils Maine Lobstermen

July 9, 2018 — Donald Trump has upended global trade relationships, promising that temporary disruption will end in better terms for American businesses. Tell that to the Maine lobster industry that his policies are putting at a major disadvantage in Europe and China.

These should be halcyon days in lobstertown. Maine harvests more lobster than any other U.S. state or Canadian province. Last year it landed nearly 111 million pounds—its fourth-largest annual haul—which it sold for $450 million. The lobster industry accounts for 2% of Maine’s economy.

And China represents a hungry new market. The post-molt lobsters Maine harvests from July through November have softer shells than Canadian lobsters, so they’re lower quality. But they also sell for several dollars less a pound. In the price-sensitive Chinese market, that has given the U.S. industry a competitive advantage over its Canadian counterparts. In 2017 the U.S. exported more than $137 million in lobsters to China, up from $52 million in 2015.

Yet Mr. Trump’s unilateral tariffs are about to erode the price advantage of American lobsters. After the U.S. announced on June 15 plans to impose a 25% tariff on $50 billion in Chinese goods, Beijing retaliated with a new 25% tariff on American seafood, farm products and autos, effective July 6. That’s on top of the 10% to 15% tariffs China already imposes on U.S. and Canadian lobster.

Read the full opinion piece at the Wall Street Journal 

What they’re saying: Local industries react to Trump’s trade war

July 9, 2018 — Local agricultural industries caught in the crossfire of President Trump’s trade disputes with some of the country’s biggest trading partners are increasingly worried that they will suffer from retaliatory tariffs on American goods.

Why it matters: From Florida to Wisconsin to Washington state, Trump risks threatening the very industries he pledged to protect on the campaign trail — and his tariffs could mean a brutal blow for the economy in states that he won in 2016.

What they’re saying:

In the Florida Keys, commercial fishermen are worried about the retaliatory tariffs China slapped Friday on 545 U.S. products, which target Florida lobster:

“At this moment I don’t know what is going to happen, we’re all just in limbo. We’ve been very fortunate over the last several years with the Chinese market.” — Gary Nichols, a lobster fisherman who voted for Trump, told CBS Miami.

Washington’s seed industry could face issues, too. Dave Armstrong, the CEO of Sakata Seed Company, told the Skagit Valley Herald that the company’s top customers are in Asia, Europe, Canada, and Mexico — and a prolonged trade war could cause the company to consider moving its operations elsewhere.

“It’s a global hub of seed movement. The actions being taken and threatened would absolutely add complexity and barriers to our ability to move seed in and out of the U.S.” — Dave Armstrong, the CEO of Sakata Seed Company

Read the full story at Axios

Lobsters caught in global tariff tit-for-tat

July 9, 2018 — Veteran lobsterman Billy Mahoney is already feeling the pinch – and not from the claws of his catch.

Mahoney sells his lobsters to a dealer in Massachusetts who, in turn, sells most of the product to an increasingly lobster-hungry China. The proposed tariffs between the U.S. and the world’s second-largest economy have already lowered the price Mahoney gets for his lobsters by 50 cents a pound.

If the tariffs imposed imposed Friday by the Trump administration hit as hard as expected, Mahoney predicts, “All hell is going to break loose as far as the price.” What’s more, China will turn to Canada for New England’s ocean delicacy, he says.

A Harvard graduate who sets out from Nahant, Mahoney has been trapping Homarus americanus for more than 40 years. At 70, he says he is close to retirement, but he has a brother in the business as well as four cousins who are bound to suffer if the tariffs linger.

Maine and Massachusetts together landed almost $700 million worth of lobster last year, 94 percent of the nation’s total. At the same time, exports from Maine to China increased more than 30 percent, according to the National Oceanic and Atmospheric Administration.

But South Shore lobstermen, already hit hard by extended seasonal closures of their fishing grounds, might largely escape the latest blow to their industry.

Read the full story at The Patriot Ledger

Trade war with China may take a new victim: South Florida lobster fishermen

July 6, 2018 — First Irma, now a trade war.

Less than a year after Hurricane Irma tore through the Florida Keys, lobster fishermen are facing another hit from the trade war with China.

Tariffs set to take effect Friday threaten to bump up prices by 25 percent — an increase that could cool demand in the lucrative Chinese market, say experts.

“This is a major impact on our fishery,” said Jeff Cramer, who fishes out of Conch Key. “And just a year after we got wiped out by the worst hurricane we’ve had in recent memory.”

Before the Chinese market picked up a decade ago, the going rate for a pound of lobster was $3. Today, fishermen can get between $10 to $20 per pound from Chinese buyers, and commercial fishermen like Cramer now send up to 75 percent of their Florida spiny lobsters to China.

“The Chinese market saved the fisherman’s ass,” said Cramer.

But with the boom came a dependence: Cramer’s Chinese buyers say that retailers have no appetite for absorbing the cost of the tariff, meaning he likely will need to lower his prices or risk losing his biggest buyers when the lobster commercial fishing season opens Aug. 6.

When possible, businesses incorporate tariff costs into consumer prices. For example, steel, lumber and aluminum tariffs imposed by the Trump administration in the past year have pushed up building costs, affecting home prices as well. But margins in the lobster trade are already slim, and Cramer worries that competition from Australia and Brazil will toss Florida out of the market if prices go up.

How a 25-year-old turned his ‘passion project’ into a global business with $30 million in sales

July 5, 2018 — When recent college grads Luke Holden and Ben Conniff opened a hole-in-the-wall, 200-square-foot lobster shack in New York City’s East Village in the fall of 2009, they were wholly unprepared.

The economy was still struggling and neither Holden, a 25-year-old banking analyst, nor Conniff, a 24-year-old freelance food writer, had any restaurant-management experience. The two had recently met through Craigslist and gave themselves a two-month timeframe to open their shack, which they dubbed “Luke’s Lobster.”

“We were very naive out of the gate,” Holden, the company’s CEO, recalls. “We were just a couple of inexperienced, hungry, can’t-say-no, going-to-find-the-answer-on-Google-type individuals.”

Holden had graduated from Georgetown University in 2007 and moved to New York City to work in finance. As an analyst at Cohen and Steers Capital Advisors, he eventually earned nearly $150,000 a year in salary and bonuses. At 25, he had an extremely comfortable lifestyle — but something was missing.

“He called me one day,” Holden’s dad, Jeff, tells CNBC Make It, “and said, ‘I’m making great money down here, I’ve got great friends, but I just don’t like what I’m doing.'”

Holden did have an idea he was excited about: a lobster shack. Growing up in the coastal town of Cape Elizabeth, Maine, his childhood revolved around the ocean. Restless with his corporate job and nostalgic for home, Holden decided to return to his family roots. In the summer of 2009 he started searching online for a high-quality, affordable, authentic Maine lobster roll, but was disappointed with the results. They were either too expensive (in the $30 range), poorly frozen, or had too much “mayo-celery,” Holden says.

Read the full story at CNBC

Canadian tariffs on US goods go into effect, but spare seafood industry

July 3, 2018 — Canada has placed tariffs valued at CAD 16.6 billion (USD 12.6 billion, EUR 10.8 billion) on American products as retaliation for a 25-percent tariff on steel and 10-percent tariff on aluminum the United States instituted earlier this year by U.S. President Donald Trump.

Canada’s tariffs took effect 1 July – Canada Day. While the new tariffs affect goods ranging from beer kegs to ball point pens, orange juice to candy to bourbon, they appear to have largely spared the seafood industry.

It’s an extraordinary situation for the two countries which traditionally tout their undefended border, close relationship, and are the world’s second-largest trading block.

More than USD 1.5 billion (EUR 1.3 billion) in goods and more than 300,000 people cross the U.S. Canada border every day. The value of trade crossing the Ambassador Bridge between Windsor, Ontario and Detroit, Michigan is equal to all of Japan’s exports to the U.S. Canada is a bigger market for U.S. goods than the 27 countries of the European Community. For example, 4,000 shipments of ingredients for Campbell’s Soup products cross from the US into Canada each day and 3,500 travel from Canada into the U.S.

Since introduction of the North American Free Trade Agreement in 1985, there has been a 350 percent rise in trade between the U.S. and Canada. Canada is one of the top five investor nations in the U.S. and is America’s primary energy source (oil, natural gas, and electricity), while Saudi Arabia is number three.

Read the full story at Seafood Source

MASSACHUSETTS: Local lobsterman to test ropeless buoy equipment

July 2, 2018 — Sonar technology used in Australia for southern rock lobster commercial fishing will be tested in July, possibly in Cape Cod Bay, as a method to better protect imperiled North Atlantic right whales from rope entanglements.

“Getting these and other systems into the hands of the fishermen and incorporating their ideas and feedback into their development is the key,” said Patrick Ramage, marine conservation program director for the International Fund for Animal Welfare, which has its operations center in Yarmouth Port.

IFAW will pay $30,000 to provide the equipment, a trainer and onboard support for what is expected to be a test by one member of the Massachusetts Lobstermen’s Association of the acoustic release equipment manufactured by Desert Star Systems, a company based in Marina, California, and founded by Marco Flagg.

The equipment replaces the typical surface buoy and vertical rope that lobstermen attach to their traps on the seafloor to identify the trap locations. Instead, the new equipment has a bottom-anchored mesh bag full of rope and floats that can open and pop up to the surface with an acoustic command from a boat. The equipment dates from the mid-1990s when a lobster fisherman in Australia wanted to prevent trap losses from gear entanglement with ships.

The equipment was tested earlier this year by five commercial snow crab fishermen in Canadian waters, Flagg said.

“The Massachusetts test is on the small side but I’m happy it’s happening,” Flagg said of what is the first pilot of the product in United States waters. Each release mechanism costs about $1,500 to $1,700 and lasts for 10 years, he said.

A Sandwich-based lobsterman is expected to pilot the equipment, according to the lobstermen’s association president Arthur “Sooky” Sawyer.

Read the full story at the Cape Cod Times

Maine lobster industry braces for looming bait shortage

July 2, 2018 — Maine’s lobster industry is on watch as fisheries regulators weigh whether to make significant cuts to herring catch limits, which could drive up bait costs that have already seen a sharp increase over the past decade.

Maine’s lobstermen draw their bait from the Atlantic herring stocks, which are managed by the New England Fishery Management Council and National Marine Fisheries Service.

In recent updates, the council said it planned on setting a significantly lower herring catch quota in 2019 than in 2018. The catch limit for 2018 was 111,000 metric tons, the same as it was in 2017. But the herring fleet landed many fewer fish than that last year, harvesting just 50,000 metric tons.

The council also called for a reduction to the catch cap for the rest of 2018 amid concerns about low densities and slow replenishment in the fish stock.

“The decline of the most important forage stock in New England is a significant blow, not only for the lobster industry that uses it for bait, but also for those species that rely on herring as forage like groundfish, tuna, whales, and seabirds,” Ben Martens, executive director of the Maine Coast Fishermen’s Association, wrote in a recent post. “Without this motion, rumor has it that the herring fishery would need to be capped at 15 metric tons in 2019, far lower than the 100-metric ton fishery that has operated in recent years.”

A herring stock assessment group held meetings in late June to try to determine its next steps and come closer to determining what quota it might propose. The group should release more details about the expected catch limits in the fall.

“Everyone’s worried about the quota and what that’s going to be,” said Kristan Porter, a Cutler lobsterman and president of the Maine Lobstermen’s Association. “There’s bait around right now, but what happens in the fall? We just don’t know.”

Read the full story at the Bangor Daily News

MASSACHUSETTS: Sen. Elizabeth Warren pushes for new lobster markets

July 2, 2018 — U.S. Sen. Elizabeth Warren moved Friday to try to protect international markets for American lobsters, urging the U.S. trade representative to explore new markets to compensate for the detrimental impact of new Chinese import tariffs.

In a letter to Robert Lighthizer, the U.S. trade representative, Warren said the 25 percent tariffs to be imposed on American lobster imports after July 6 will economically harm American lobstermen and the fishing communities in which they live and operate their businesses.

“China is a large and growing market for lobsters, with total lobster imports from America topping $100 million in recent years,” Warren said in her letter. “Large Chinese tariffs on American lobster will effectively close off that market because China can substitute cheaper lobsters from Canada or Europe for American lobsters.”

The new Chinese tariffs on $50 billion worth of American goods, imposed in response to new tariffs ordered by President Donald Trump on Chinese imports into the United States, actually will mean that American lobster exporters will be paying the new 25 percent on top of the current 7 percent tariff — resulting in a tariff of 32 percent on imported American lobsters.

Read the full story at the Gloucester Daily Times

Fishermen feeling bait price squeeze

June 28, 2018 — “We made no money this spring,” said Bass Harbor fisherman Justin Sprague.

The cost of operations for lobstering continues to increase while the boat price of lobster has hardly budged. The cost of herring, the preferred bait for most Maine lobsterman, has gone up especially sharply.

“We don’t have any margin at this point,” Sprague said. “It’s frustrating, to say the least.”

Bruce Colbeth manages the C.H. Rich lobster wharf in Bass Harbor.

“By the time these guys pay for fuel, bait and stern men, there ain’t too much left for them,” he said. “I remember six years ago you could sell (herring) bait for $26 a bushel. Now it’s doubled.”

Herring bait is sold in trays. Fisherman Chris Goodwin said he paid almost $80 per tray for herring bait the last time he stocked up.

A ton of bait can be divided into about 13 trays, Cody Gatcomb of C.H. Rich explained. A tray of fish bait is equivalent to 1.5 bushels, Colbeth said. He saw a recent 3-cent per pound increase at his operation.

That adds up fast.

At the moment, not considered prime season, C.H. Rich Co. is selling between 350 and 400 trays of herring bait a week, Colbeth said. Once the season begins in July, they can expect to sell up to 800 trays of bait each week.

Some fishermen have reserved barrels of herring bait for the upcoming season in preparation for a possible shortage, Gatcomb said.

Read the full story at the Mount Desert Islander