Canada's Atlantic Fisheries
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  • 1. Canada’s  Atlantic  Fisheries A big business for small communities
  • 2. $1.8 billion in landed value 2011 Pelagics 5% Other shellfish 9% Lobster 34% Groundfish 10% Shrimp 17% Crab 25% Big three = $1.4 billion or 76 %
  • 3. Distribution of landed value Corporate 25% Owner operators 75%
  • 4. Why do owner-operators have so much of the value? Groundfish ? Pelagics ? Other shellfish ? Lobster 99% Shrimp 60% Crab 100%
  • 5. It  wasn’t  always  this  way. Pelagics 10% Other shellfish 10% Groundfish 42% Lobster 25% Crab 5% Shrimp 8% Big Three = 38% of total value in 1990
  • 6. Who are the owner-operators?
  • 7. Not the same everywhere Setting day Newfoundland • Region  ’s  largest  private  sector  employer • 10,000 individual enterprises • Employing 20,000 crew • Almost entirely rural based • All independently owned & operated Setting day Sou’West Nova
  • 8. Common policy framework Common policy framework Owner-Operator: have to fish licences personally Fleet seperation: processors  can’t  hold  o-o licences
  • 9. Main threats Weak policy enforcement • Corporate predation High investment costs for new entrants • licences and quotas Low return on investments • increasing operating costs (fuel, bait, management) • weak markets 4,000 3,500 3,000 2,500 Ind Core 2,000 Core 1,500 DFO promoting concentration 1,000 500 0 NS NB PEI QC NL
  • 10. Age profile 2004 40% 35% Atlantic 30% Pacific 25% 20% 15% 10% 5% 0% < 35 35 - 39 40 - 49 50 - 59 60 +
  • 11. New entrants face higher investment costs  Profits at least 25% lower for new entrants  Low profitability • Drives out fishermen • Requires  higher  efficiency….   builds pressure for concentration & vertical integration 1973-1983 1989-1998 2005-2011
  • 12. Fleets opposed to vertical integration Reduces dock-side competition & owner-operator bargaining power – Lower prices paid to independent harvesters – Reduced resources to other processors / wholesalers – Leads to concentration Results in lower employment – Less jobs in some communities – Conflicts between communities – Conflicts between provinces
  • 13. Today’s  Globe  and  Mail Productivity overrated as a key to growth “…focussing on efficiency at the expense of jobs and  hours  worked  could  lead  to  ‘greater   unemployment, income loss and reduced wellbeing’.” - Andrew Sharpe, Editor International Productivity Monitor
  • 14. Fleets seeking alternatives  Major fleet managed buybacks in last 2 years  Looking at fleet managed initiatives to facilitate intergenerational transfers  Exploring marketing and branding to increase revenues/incomes
  • 15. Can social finance help?