February 18, 2015
Executive Director's Message
2015 is shaping up to be a very exciting year for the Canadian lobster industry with exports to Asia growing, progress being made on quality grading, the new Canadian lobster brand, eco-certification of the inshore fishery, potential work on automation and the talk of an industry levy on the horizon.
In general 2014 was a good year for most participants in the lobster sector. Prices at the wharf and in the market were aided by the weakened Canadian currency which favours exports, landings were generally up and the economies in our major trading partners were stronger. But challenges abound that require unified effort. Processing plants that need a consistent workforce are dealing with major changes to the Temporary Foreign Worker Program. Exporters must change their packaging to adhere to new rules in the European Union and the entire sector is trying to find mechanisms to collect to fund marketing, promotion and the priorities of the Lobster Council.
Coming off a solid year is the perfect time to invest in the future of the lobster sector so let’s continue to work together and finalize the mechanism to fund a professional and proactive Lobster Council of Canada. Here’s how you can help the sector:
1. Participate in the discussions around an industry levy. A levy or flat fee system – the details are different for each province and are discussed in detail below are very important to growing long term value within the sector. Nova Scotia is currently in the midst of more stakeholder sessions with harvesters and buyers, New Brunswick is finishing similar industry engagement, Newfoundland and Labrador is working on options and PEI is on its way to collecting via a marketing board and an amendment to their Fisheries Act.
2. Understand why Generic Marketing is Important. It’s not enough to sell our recent record catches at low prices. Canadian lobster needs to be sold as a premium product to ensure that the higher prices result in the growth throughout the sector, with harvesters and exporters both benefitting. Other sectors like beef, blueberries, pork and chicken have shown that generic marketing works to stabilize and grow prices and build demand in new markets. The ROI is compelling. In the beef industry – for every dollar invested there is a nine fold return on the initial investment. Since harvesters retain about 75% of the selling price of lobster, higher selling prices mean more value for harvesters. This is a compelling reason to invest in generic marketing.
To learn more about generic marketing check out the Lobster Council of Canada’s new generic marketing strategy which answers questions around – how would money invested in generic marketing be spent – on what countries and on what tactics and what results can be expected.
3. Become familiar with and start to use the Canadian Lobster Brand. As the new generic marketing strategy states “The Best Lobster in the World Comes from Canada.” Research shows that markets – particularly international markets, respond to Canadian’s positive image for honesty and our high standards when it comes to quality and food safety. The fact that our lobster tastes great and is a pure, wild source of protein that is not “boring” but is seen as “celebration” food is additional equity in the brand. The work that the LCC has done on traceability and sustainability complements the focus on quality, sustainability and safe food sources. There are other smart reasons for selling lobster under the Canadian brand. Agriculture and AgriFood Canada have programs that could match investment when marketing under the Canada brand. This creates more bang for the collective buck.
4. Support the Lobster Council of Canada by becoming a member. Tough times as well as an acknowledgement that the sector needed to work together led to the creation of the Lobster Council in 2009-2010. Firmly supported by the Atlantic Provinces, the vast majority of lobster sector participants and The Maritime Lobster Panel, the LCC’s mandate is to enhance the value of Canadian lobster in a sustainable fashion by addressing issues of importance to the industry.
It is important to note that Provincial Governments have supported the LCC since its inception and while we are extremely grateful for this support, and will continue to need it to operate in 2015, it is vital that all participants in the industry support our efforts by becoming members. In 2010, the LCC started to solicit industry for membership funding. Industry support has grown each year but membership contributions represents less than a third of the council’s budget. To continue to represent industry on issues of mutual concern like market access; marketing & promotion; and market research, the LCC needs support from the lobster sector.
The next few months will be busy with the LCC as we roll out the generic marketing story as well as work on market access issues (labelling in the EU), plus attend numerous meetings, events and trade shows. We anticipate that the NS/NB Lobster Eco-certification Society will receive the MSC designation in April (see below), which will join PEI and part of Quebec and be a great news story for the industry. We are also working with the processing sector to develop an Automation Project to help deal with the challenges of the chronic labour shortage as well as helping to organize the China Seafood Expo.
Finally, I think readers will find it insightful to read an update on the activities and priorities of the Maine Lobstermen’s Association. Special thanks to Melissa Waterman for contributing to our newsletter.