No so­lu­tion

McCurdy dis­misses pro­ces­sor pro­posal, slams govern­ment in­ac­tion

The Compass - - FRONT PAGE -

Con­tin­u­ing dis­con­tent in the prov­ince’s fish­ery reached new heights last week when ef­forts to find a so­lu­tion to a price dis­pute in the crab in­dus­try col­lapsed.

He said it wanted the prov­ince to pro­vide in­ven­tory fi­nanc­ing of up to $100 mil­lion to hold about 35 per cent of the crab quota. Do­ing so would help avoid the prac­tice of dump­ing all the prod­uct into the mar­ket at the same time and driv­ing the price down­wards, as has been the case in re­cent years.

Govern­ment would as­sume the risk, and hope the mar­ket would re­main strong enough to re­coup its in­vest­ment.

Jack­man said a le­gal opin­ion from an in­ter­na­tional trade lawyer warned the govern­ment that do­ing so would pose a risk.

“ If we open that door, we don’t know where it could lead,” Jack­man said.

The min­is­ter seemed to sug­gest the ball was clearly in the court of pro­duc­ers and har­vesters.

“ We, as a govern­ment, can’t set a price. This is in­cum­bent on the par­ties here to get a price and get the fish­ery started,” he said.

Mean­while, ASP ex­ec­u­tive pro­ducer Derek But­ler also pro­vided de­tails of its of­fer to har­vesters.

He said pro­duc­ers were pre­pared to of­fer $1.19 per pound, but un­der a new for­mula that would see har­vesters paid a “ fish­ing price” of $1.09, and an­other div­i­dend at the end of the year, based on re­turns in the mar­ket.

It’s a for­mula sim­i­lar to the one used in the Alaskan crab in­dus­try.

Jack­man also seemed to en­dorse such a for­mula.

But­ler said pro­duc­ers would open their books for an au­dit at the end of the year to en­sure trans­parency.

But­ler said the union re­jected the of­fer, say­ing they would stick with the $1.35 price set by the prov­ince’s price-set­ting panel, and turn to the govern­ment to bridge the gap.

“ That’s a huge change for us, and I would have thought that would have got­ten us fur­ther,” But­ler said.

But­ler said pro­duc­ers are also sym­pa­thetic to the govern­ment’s po­si­tion.

“ They don’t want to run these coun­ter­vail­ing risks, and nei­ther do I. All that does is en­sure we shut down the fish­ery next year when we get this huge coun­ter­vail hit and have to pay fines in the mil­lions of dol­lars on a go-for­ward ba­sis be­cause of what we’ve done,” he said.

Ac­cord­ing to govern­ment fig­ures, more than 20,000 peo­ple work in the crab fish­ery, and it’s worth hun­dreds of mil­lions of dol­lars to the econ­omy each year.

But the in­dus­try’s vi­a­bil­ity is be­ing chal­lenged by fac­tors such as a strong Cana­dian cur­rency, and a world­wide econ­omy that is still re­cov­er­ing from re­ces­sion.

The price-set­ting panel re­cently set the price for crab at $ 1.35, a de­ci­sion that prompted pro­duc­ers to refuse to buy any raw ma­te­rial.

The har­vest was sched­uled to open April 1, but so far there’s been only limited ac­tiv­ity, and hun­dreds of fish­ing en­ter­prises and nearly three dozen plants are idle.

FFAW pres­i­dent Earle McCurdy speaks with re­porters at a late af­ter­noon news con­fer­ence in St. John’s Thurs­day.

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