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Lobster Marketing – A Need for Improvement

Lobster Marketing – A Need for Improvement. Robert Verge, P.Eng., MBA, CA, CMC Managing Director Canadian Centre for Fisheries Innovation October, 2013. Price vs. Market Demand. Price vs. Market Supply. Demand = Supply. The US Great Recession. The Currency Effect.

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Lobster Marketing – A Need for Improvement

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  1. Lobster Marketing –A Need for Improvement Robert Verge, P.Eng., MBA, CA, CMC Managing Director Canadian Centre for Fisheries Innovation October, 2013

  2. Price vs. Market Demand

  3. Price vs. Market Supply

  4. Demand = Supply

  5. The US Great Recession

  6. The Currency Effect

  7. Lobster Supply vs. Price Rising Prices Falling & limited demand

  8. It’s Not Just Us • “In 1992, Maine lobstermen landed about 27 million pounds of lobster. They landed almost 127 million pounds in 2012.” National Fisherman, Aug 15, 2013 AVERAGE ANNUAL WHOLESALE LOBSTER PRICES2012 statewide average: $2.69/pound2011 statewide average: $3.19/pound2010 statewide average: $3.31/pound2009 statewide average: $2.93/pound2008 statewide average: $3.51/pound Source: Maine DMR

  9. Impact of High Production

  10. World Lobster Supply

  11. In Contrast … Record western rock lobster prices Western Australian rock lobster fishers are receiving record high prices for their catch. Prices have tipped more than $60 per kilo for some grades of lobster. Fisherman Anthony Jupp says these prices bring the WA fishery into line with other lobster fisheries. "You look at New Zealand and South Australia, they've quotas as well. "We were talking to a guy from New Zealand a few days ago and he said some of the blokes over there don't go to work for $50 a kilo. They wait until it gets to $100 a kilo.“ Australian Broadcasting Corporation Posted Wed 5 Jun 2013, 4:32pm AEST

  12. Price is NOT the Problem • Price is just a symptom • Supply has increased much faster than our traditional markets can absorb, forcing prices down • The problem is lack of market development to absorb the additional supply • It’s a big job but somebody has to do it – and it requires effort and investment • No one company can do it alone

  13. Seafood.com, July 22, 2013 • During a June 7 airing of the radio show Boston Public Radio, hosts Jim Braude and Margery Eagen spent a good 10 minutes chuckling over the fact that a Walgreens store in Boston was selling live lobsters. The pairing of a drug store and live lobster was just too unappetizing for them … • It may be an odd way for a drug store to branch out, but it's emblematic of the crossroads where the Maine lobster brand finds itself. Lobster landings are up, way up, from historic figures. There's a need to move a lot of lobster through the marketplace without devolving the lobster brand into a commodity, says Marianne LaCroix, acting executive director of the Maine Lobster Promotion Council. "The challenge is that we have a premium brand product and there's a lot of it in the marketplace," LaCroix says. • Lobster industry stakeholders agree that the future of lobster marketing will have to include an approach that expands the marketplace for Maine lobster while still maintaining its cache among culinary circles.

  14. Maine – the Response (1) • Gov. Paul LePage said he would like to see enough factories built in Maine so that all Maine lobsters that are to be processed can be handled within the state. LePageaddressed the status of the lobster industry Thursday morning during a speech and short question-and-answer period in the food tent at the Maine Lobster Festival. "Frankly, I would like to be completely self-sufficient in processing lobsters caught in the ocean off the coast of Maine within the next three years," LePage said. He said his administration was working very hard to find people who would develop new processing plants in Maine Seafood.com, Aug 3, 2013

  15. Maine – the Response (2) • Now, Maine's lobster industry is trying to market its brand more broadly and increase sales of what's already the state's best-known seafood. • A state law taking effect in October will raise the annual marketing budget for lobsters to more than $2.2 million, a six-fold increase. The goal is to grow demand in the U.S. and abroad, while increasing prices to help fishermen increase their income. • The law creates what's known as the Maine Lobster Marketing Collaborative, which replaces the Maine Lobster Promotion Council. • Its budget is projected to grow from $750,000 for the current fiscal year to $1.5 million next year and $2.2 million after that. The council's budget this past year was about $370,000. Seafood.com, Sept 4, 2013

  16. Canada – the Response PEI fishermen leaders seem skeptical of Lobster Council's one cent per pound levy plan SEAFOOD.COM NEWS [CBC News] August 27, 2013 2012 Landings = 71,528 tonnes = 157,690,629 lb @$0.01/lb = $1,576,906 Will that be enough?

  17. What’s YOUR Choice? It’s easy to criticize … and harder to be part of the solution … but we need one. The options: • Limit production to what the market can absorb at higher prices • Accept lower prices and improve efficiency or • Develop markets to absorb the extra production at good prices

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