Seafood-pricing system is flawed and a new one needs to be in place by end of January, says report

 (Patrick Butler, Mark Cumby/CBC - image credit)
(Patrick Butler, Mark Cumby/CBC - image credit)

Fish, Food & Allied Workers president Greg Pretty, left, and Association of Seafood Producers president Jeff Loder say they welcome the recommendations of a new report that calls for formula-based pricing for seafood industries. (Patrick Butler, Mark Cumby/CBC)

A new report from the Newfoundland and Labrador government says the current seafood price-setting process is flawed, and it outlines the need for a formula-based system that would improve the industry for harvesters and plant owners.

The report was sparked by a tie-up in the spring that delayed the start of the snow crab fishery. Prices were set at just $2.20 per pound at the start of the season, and the Fish, Food & Allied Workers union and Association of Seafood Producers failed to produce an agreeable pricing formula.

It says the current process for price setting, which is done by a panel, is flawed — and that the panel has an "impossible task" when faced with a fluctuating market.

"It has to be corrected, and this report is a way forward," FFAW president Greg Pretty said Thursday. "[The report] is a very astute, sharp post-mortem of the past season, but it also looks at how we got here and plans out a good path for the future."

The report — from a three-person team appointed by the government in September to review the current system, offers nine recommendations, including implementing formula-based pricing by the end of January, ensuring a new formula is set months before the season starts, and establishing an independent fisheries management structure.

Pretty said he was especially pleased to see the need for all parties to have more comprehensive data before the price-setting process, saying it will create a more level playing field and incorporate market price increases better than the previous system.

"If the market increases, it will give returns to harvesters. We haven't had that in the past, and that's something that's critical to the future," he said. "There's an opportunity to do this thing right this time."

Tie-up was avoidable, says report

The report, issued Thursday, concluded much of the disruption caused by the tie-up of the snow crab fishery was likely avoidable.

Jeff Loder, president of the Association of Seafood Producers, said the recommendations show a clear and obvious effort to ensure that history doesn't repeat itself.

Crab landed on the dock at St. John's Harbour on Thursday, May 6, 2021.
Crab landed on the dock at St. John's Harbour on Thursday, May 6, 2021.

The report was sparked by a tie-up that kept harvesters out of the water for six weeks over low snow crab prices. (Paul Daly/The Canadian Press)

"We've seen this year what happens when you don't have a stable system for setting prices," he said. "It also highlights the need to get to the table and to work through all of the issues that contribute to creating value for fish species."

On Thursday, Environment Minister Bernard Davis and Fisheries Minister Elvis Loveless said they welcome the recommendations from the report and don't want a repeat of this year's headaches in the spring.

While some of the recommendations would require legislative change, Davis said they wouldn't impede the start of next season.

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