The Mystery of Cheap Lobster

Photo by Paul Keleher/Flickr CC

What has the world come to? A report has come across the newswire telling of misery among the lobstermen of New England. They have too many lobsters, and no one wants to buy them. Remember when lobster was one of the most expensive foods you could buy? Now it's so cheap that fishermen are hawking lobsters on the street for a few bucks.

At first glance, this situation seems to epitomize the Great Recession of 2009. Wall Street fat cats aren't dining out anymore. Demand for luxury goods has plummeted across the board. Hard-working lobstermen are left in the lurch. And you can be pretty sure President Obama isn't going to give them a bailout.

At second glance, it seems even worse--more evidence of the obliteration of the world's fisheries. Over and over again, fisherman in different parts of the world have caught too many fish; first the price plummets, then the entire stock collapses. In Canada, cod fishermen are still waiting for the cod stock they wiped out nearly 20 years ago to return. Are the current woes of our lobstermen just a harbinger of disaster to come?

Both of these explanations sound plausible, but neither is accurate.

The majority of New England's lobster catch comes from the Gulf of Maine, and unlike most fishermen around the world, lobstermen in the Gulf have done a decent job of fishing sustainably. For decades they've been protecting young lobsters, extra-large lobsters, and female lobsters with eggs, throwing all these back into the sea, exactly because they don't want to wipe out the entire stock.

Scientists have surveyed the lobster population in the Gulf and concluded that adult lobsters continue to have lots of sex and make lots of babies. The lobster catch has been going up over the past 20 years because there are more fishermen and more traps than there used to be, but also because there are more lobsters, which is good news. In fact, the Gulf of Maine lobster fishery has been an unusual success story.

But here's the problem--and this is the key to understanding what's happening now. Way before our current recession began, lobstermen were doing such a good job conserving their resource that beginning in the 1990s, they were already catching more lobsters than the market could sustain. There's never been enough demand for all those live lobsters. They've always had to go somewhere else.

Remember how I said stocks of codfish in Canada had collapsed 20 years ago? Those cod used to be packaged and frozen by Canadian processing plants. After the cod collapse, the same Canadian plants started packaging and freezing the extra lobsters being caught in New England. They took up the slack.

By an unfortunate twist of fate, those plants had their financing tied up in the Icelandic banking system, and when it collapsed last fall, the capacity of the processing plants did, too. Ever since then, the market has been flooded with excess live lobster. Lobsters that used to get turned into frozen claws and tails for mid-level chains like Red Lobster are now filling the fresh lobster tanks to overflowing. Thus the crash in price. The fact that luxury dining has declined doesn't help, but it's not the cause. The problem is simply that New England's lobsters have finally come home to roost.

Now lobstermen are trying to hawk their extra lobsters on the street, and retailers are furious, because it's undercutting prices even more.

The retailers have reason to be upset. While the Gulf of Maine lobster fishery has been a success story in terms of conservation, the industry has been less savvy about marketing its product. Lobstermen might be better off now if they'd been more disciplined in the past, by catching fewer lobsters and making sure that they protected the status of their premium live-lobster brand. They'd be in trouble now, too, but they'd have fewer lobsters on hand to worry about unloading at rock-bottom prices.

What lobstermen in the Gulf of Maine should be doing is coordinating with each other to cut back their catch, fish fewer traps, and market the heck out of their lobsters as a highly-desirable item of sustainable seafood. To the industry's credit, it has already sought marketing assistance from the Marine Stewardship Council, which certifies sustainable seafood.

There's a real and increasing demand for sustainable seafood among environmentally conscious eaters, even during a recession. If New England lobstermen behave less like Down East cowboys and more like a clever cooperative, they could make their industry as well as their fishery sustainable again.

But with lobster now dirt-cheap, it's going to take some work to claw their way back up the food chain.