In the wake of extensive cuts to Northern shrimp, the Department of Fisheries and Oceans (DFO) has announced the 2017 snow crab Total Allowable Catch (TAC) for Newfoundland and Labrador Region is 35,419 tonnes, an overall quota level decrease of approximately 22 per cent from 2016.
The TAC decrease includes a two per cent reduction in 3K, 26 per cent in division 3LNO (46 per cent in the areas outside the 200-mile limit and 23 per cent in areas inside the 200 mile limit), a 50 per cent reduction in the 3Ps quota, and a six per cent reduction in 4R3Pn. Quotas in 2GHJ will remain at 2016 levels.
However, unlike the devastating news on shrimp, the minimum price of $4.39/pound for crab is expected to make up for the quota reduction for many fishermen. Last year’s minimum price was $3/pound.
But the organization representing processors are not overly happy with the hefty price increase.
The Association of Seafood Producers (ASP) said the Standing Fish Price Setting Panel decision on raw material crab prices compounds the already bad news on quota cuts, and places the industry at substantial risk of a market collapse.
“The Panel has set crab raw material prices at a historic high, well above any previous level. ASP’s offer to harvesters of $4.10 was rejected and the Panel has gone with the FFAW price of $4.39,” said Derek Butler, Executive Director of ASP.
“The market reports contracted by the province were both clear,” said Butler. “Consumption is reducing, the price has gotten too high, and it is spot pricing in response to quota reductions in Alaska and here that is being used. That is wrong. It is not the reality of our snow crab industry.”
The Panel’s premise as reported in its written decision is that the market is at the USD$8.00 or higher, but Butler says the Panel failed to take into account contracts that are done at USD$6.95.
“We expect the Panel to be evidence based, and the latest evidence on prices for N.L. crab — not spot pricing based on no supply — are the contracts established with large Japanese buyers at USD$6.95 per pound,” said Butler. “How can actual contracts as reported on not be relevant?”
Butler says the market report from the U.S. in particular notes that there is a redline that should not be crossed in terms of market prices.
“We found that in shrimp, and the result is growing inventories and falling market prices. Shrimp is a disaster, even on reducing volumes. Now the Panel has ignored that risk, that history, and decided to go with spot pricing for case load sales, as opposed to the volumes we are dealing in,” said Butler. “It will not be pretty.”
Butler says the Panel has also completely ignored the assessment of the Gulf of St. Lawrence’s ability to support the growing inventories it will have, and the market will take advantage of that.
“This decision leaves processors and our plants exposed to a market collapse,” said Butler. “It is a disservice to this industry to be so cavalier about the future, or to think that a single reconsideration on price, provided for in legislation, can correct this.”
Butler says the panel has neglected its own mandate to set minimum prices, and not to set the market price.
“Even at the $4.10, the landed value of crab this year — even after the quota cuts — would have been higher than last year, with less cost to harvesters in terms of fishing. The Panel has instead seen fit to place all the risk on producers, less volume, less hours for plant workers, and now a utopic view of the market. It simply does not add up,” said Butler.
DFO said the management approach supports sustainability of the snow crab resource. This approach includes the continuation of early and shortened fishing seasons, strict soft-shell protocols, no fall fishery in 3K, maintaining quota levels in 2J, quota decreases in one area of division 3K, all areas of divisions 3LNO, all areas of sub-division 3Ps and quota decreases in three areas in division 4R3Pn. 3Ps Supplementary fleet quotas in 10BCD, 10X and 11S will be merged into one allocation.
Some fleets will be ready to fish immediately. An early opening in these areas is essential to providing the best opportunity to avoid high incidence of soft-shell during the fishery and to spread the landings over a longer period of time. In addition, grid based soft-shell protocols are continued in all areas.
Areas closed as a result of soft-shell crab will remain closed for the remainder of the year. Grids closed for soft-shell crab in Shrimp Fishing Areas 4, 5 or 6 will also be closed to shrimp harvesting for 60 days. All season closure dates are subject to modification if there is a high incidence of soft-shell crab encountered in the fishery. An individual quota (IQ) does not guarantee that all crab will be landed.
- The harvest levels for 2GHJ will remain unchanged in 2017.
The overall Snow crab quota in Division 3K will decrease by two per cent in 2017 to 5,794 tonnes from 5,889 tonnes in 2016.
- Harvest level in area 3B will be decreased by 20 per cent in 2017.
- The harvest levels in areas 3A, 3BC, 3C, 3D and 4 will remain unchanged in 2017.
The overall quota of Snow crab in 3LNO will be decreased by 26 per cent, from 33,486 tonnes in 2016 to 24,787 tonnes in 2017.
- Harvest levels in areas 5A, and 8A will be decreased by 15 per cent in 2017.
- Harvest levels in areas 6A, 9A, 8B, Midshore and Midshore extended will be decreased by 20 per cent in 2017.
- Harvest levels in area 6B, 6C, Nearshore and 3L extended will be decreased by 25 per cent in 2017.
- Harvest levels in area 8Bx, 8Bx north, 8Bx south and 3L outside 200 miles will be decreased by 40 per cent in 2017.
- Harvest levels in areas 3NO outside 200 miles will be decreased by 50 per cent in 2017.
The overall quota for Snow crab in Sub- division 3Ps will be decreased by 50 per cent in 2017.
- Harvest levels in areas 10A, 10B, 11S, 11E and 11W will be decreased by 50 per cent in 2017.
Division 4R and Subdivision 3Pn
The overall quota for Snow crab in division 4R and sub-division 3Pn will be decreased by 6 per cent in 2017.
- Harvest levels in areas Outside of 8 miles, 12A, 12B, 12D and 12G will remain unchanged in 2017.
- Harvest levels in areas 12C and Bay St. George will be decreased by 15 per cent in 2017.
- Harvest levels in areas 12E, 12F and Bay of Islands will be decreased by 20 per cent in 2017.