When the stock market took a 30 percent tumble after the tech bubble burst in 2000, experienced investors observed that many of those who lost their shirts had never lived through a downturn in the market. The same thing could be said about the lobster industry today.
Beginning in 1987, strange and wonderful things started to happen in the lobster business. After 40 years of inexplicably stable landings that hovered around 20 million pounds a year, lobster harvests began ticking up. Landings went up again — and then again and again and again — until the annual harvest in Maine had doubled to 40 million pounds a decade later. Lobstermen bought bigger boats, and part time and marginal fishermen put more traps in the water to scale up to the new statewide limit of 800 traps. Soon a million more traps were in the water. Within another six to eight years, lobster landings had tripled to over 60 million pounds — and in seeming defiance of the laws of supply and demand, per pound prices to lobstermen also inexorably increased year by year. It was almost as if you could not not make money fishing for lobsters.
The reality was actually even stranger than it appears. Maine’s top lobster biologist, Carl Wilson, points out that until Maine passed a law a few years ago requiring lobster dealers to report all their sales, the annual lobster harvest numbers were based a voluntary reporting program. Wilson says that when lobster landings peaked in 2003 at about 76 million pounds, he believes the actual harvest was well over 100 million pounds and perhaps even as much as 150 million pounds. Old timers said lobsters are cyclical and that the good times would not last forever, but younger fishermen kept looking at their receipts and co-op members kept cashing their bonus checks as if there were no tomorrow.
Then reality began to raise its homely head. Between 2004 and 2006, harvests declined slightly, but the prices continued to rise, so no one was too alarmed — that is, until last year. The Department of Marine Resources’ figures just released for 2007 confirmed the scuttlebutt in most every lobster port along the coast: the lobster harvest had declined significantly — off by 23 percent in volume and 16 percent in value from a year earlier — a depressing $50 million that has gone missing from island and working waterfront communities in the course of a year and a stunning 40 percent reduction in landings from the peak of 2003. Today a young fisherman who started lobstering full time as a teenager or 20-year-old in the early to mid 1990s is likely to be carrying a mortgage on a large lobster boat, a mortgage on a house and perhaps a truck loan in his early 30s as his earning power erodes for a second or third year in a row. It’s a scary picture.
Behind these figures are other disturbing trends. To catch last year’s 56 million pounds of lobsters, lobstermen used something like three pounds of herring or other bait for every pound of lobsters they landed. While it is true that a three-to-one conversion ratio of fish bait to luxury food per pound is way better than the ten-to-one conversion for sirloin, some consumers have shunned farmed salmon for conversion rates deemed wasteful at a pound and a half of fish feed to one pound of harvested salmon. On top of the question of whether it will become politically incorrect to eat lobsters that are fed with such profligate amounts of herring in a protein-starved world, the raw economic facts of the 35 percent increase in bait costs since 2005 might make some lobstermen question how big a bait bag they need in order to land a pound of lobster. Then, of course, there is the price of fossil fuel that the lobster industry depends upon, which we all know will continue its inexorable rise. Last year, Diesel fuel averaged $3.25 per gallon — a 20 percent increase over the year before; last year the price of gas in London hovered around $8 a gallon as one harbinger of the future.
To add to this perfect storm of ill winds, in answer to a lawsuit brought by animal rights and national environmental advocates, the federal government is going to require a massive restructuring of lobster gear in order to reduce mortality of endangered right whales that get tangled in fishing lines. The solution to the right whale problem has focused on eliminating floating ground lines that run between traps offshore, but this solution will almost certainly increase the number of vertical lines in the water, which common sense suggests will be even more problematic — and more litigious — on into the indefinite future.
All of these factors lead to the inevitable conclusion that lobstermen are going to have to change how they conduct their businesses — and quite radically — in order to survive. The old lobster model was a form of the basic American dream: the harder you work (meaning the more traps you put in the water in order to mark and defend your territory) the more lobsters you caught and the more money you made. But like the closing of the frontier a century ago in the West, those days off the Maine coast are rapidly drawing to a close. Fishing 800 traps from big boats burning 100 gallons of fuel a day costing between $5-$10 per gallon with big bait bags full of $30-a-bushel herring chasing lobsters ever further into the habitat of right whales is not a picture of a secure future.
Brute force fishing is no longer a strategy for success. Rather, those lobstermen (and women) who understand the subtleties of when, where and how to fish with greater efficiency and those with an astute business sense that recognizes the importance of trading on the enormous enthusiasm most consumers have for the independent lifestyle of Maine’s crustacean catchers, these will be the successful fishermen of the future. They will be working smarter, not harder.
Philip Conkling is president of the Island Institute.