Decrease in lobster exports to China more than a ‘blip,’ say critics

PC Fisheries and Aquaculture critic responds to minister's comments

PC Fisheries and Aquaculture critic Keith Bain says he is “alarmed” at recent comments by Fisheries and Aquaculture Minister Keith Colwell that falling lobster prices due to the Coronavirus are just a temporary “blip” in the marketplace.

“On one hand, Minister Colwell calls the drop in lobster exports a ‘blip,’ but on the other hand, the federal Liberal government is sounding the alarm” that the coronavirus is “undoubtedly going to have an economic impact,” said Bain in a media release.

Bain said people in the lobster industry are genuinely worried about the sudden and rapid decline in exports of lobster to China.

"This McNeil government has focused much of its energy on expanding the Chinese market and has left Nova Scotia business susceptible to unfortunate events like this,” Bain wrote in a letter to the minister, expressing the concerns of lobster fishers in the province.

He wants the minister to say what his plan is and what the options are for the industry.

"Transparency is vitally important, because no one can say with certainty when lobster exports to China will resume at a normal pace," he said.

The decrease in lobster price is stoking fear in the industry throughout the province, especially in rural communities, said Bain, noting soon other lobster fishing seasons will be opening throughout the Maritimes. In Digby, for instance, the season will be starting up again soon.

Bain said with the supply of lobsters continuing to increase, it will mean a further price drop for the industry as time goes on.

"Nova Scotian fishers need to know there is a plan in place, one that will open new overseas markets and sustain their industry through this sudden downturn of lobster prices and exports,” stated

Bain. “They also need reassurance that the Minister of Fisheries and Aquaculture appreciates this serious threat to their livelihoods.”

Argyle-Barrington MLA Colton LeBlanc agrees.

“I have many lobster fishers in my area who are keeping a close eye on the China market, and they are asking what is being done to support our lobster fishers and mitigate any negative impacts to the industry,” he said. “There needs to be a contingency plan in place that we can share with our constituents, and it has to happen sooner rather than later.”

In southwestern Nova Scotia and along the province's south shore, the LFA 33 and 34 commercial fisheries got underway at the end of November. Normally at this time of the year there would be a higher shore price, but instead fishermen have seen it drop. The shore price for lobster dropped from $10.50 to $8 a pound in late January when the Chinese market for live lobster plummeted due to the Coronavirus. It has since dropped to the $7 range.

“There has been a big change in market demand in China due to the governmentimposed travel restrictions resulting in closed restaurants and hotels, restrictions on travel and closed retail markets,” said Leo Muise, executive director of the Nova Scotia Seafood Alliance.

“The good news is the border (itself) has not been closed to live or processed lobster from Canada and (also) this is a comparatively quiet time of year, 60 to 90 days before the normal serious spring production,” said Muise. “There are no regulatory changes to import rules for live products being shipped to the Chinese market, so when the demand returns to normal, we feel we will be well positioned to respond.”

But the outbreak of the Coronavirus in China has presented a “significant challenge” to the industry, said Muise.

“We are assessing its dimensions day to day. Many of our member companies are diversified in over 50 countries around the world, and we will work with all of our stakeholder groups to get through this situation," he said. "It is important to remain composed as the full extent of the coronavirus issue becomes known.”

Muise noted the Alliance’s “first thoughts and best wishes are for the health and wellness of the people in China and other impacted areas around the world and for those in the industry who have been impacted by this large drop in sales to China."

“Fortunately, our customers and friends in China appear to be weathering this situation as well as they might given all the circumstances,” he said. “They still have a strong appetite for our Nova Scotia seafood of all types. We are very highly regarded for food safety, traceability and premium quality. That and our close relationships will see us in good shape in due course.”

Nova Scotia is the leading seafood exporter in Canada. In 2018, Nova Scotia seafood exports exceeded $2 billion – 29 per cent of Canada’s total seafood exports. The province’s seafood exports have more than doubled since 2012 when they stood at $922 million.

According to Statistics Canada data, for the first 11 months of 2019 a total of 23,624,875 kg of live lobster worth $409,487,924 was shipped to China, making it number one for the volume of Canadian live lobster exports. The volume of lobster export to the U.S. for the same time period was 20,569,649 kg with a value of $448,939,432.

Meanwhile, when asked for further comment on the issue, Colwell said "the current restriction on shipping our premium quality lobster to China is unfortunate, but our department has been working hard to grow exports of our lobster to other markets – such as Europe, the U.S., Vietnam and other parts of Asia.

"We support our industry partners in attending trade shows in Boston and Brussels, which feature buyers from around the world," said Colwell, noting Nova Scotia currently exports fishery products to about 80 countries.

"Our fishery product exports are now at more than $2 billion. Global demand for seafood is strong, and our export market is growing. While China is an important market, we are confident our industry has the strength to endure this temporary setback in one market."