Lately when people ask about the biggest challenges facing Maine islands and working waterfront communities, two questions loom over all others: what will the price of lobsters be and what will energy cost? The prices for lobsters and energy will likely determine whether islands can survive as viable year-round communities and the trends suggest that we are on a collision course with reality.
The lobster issue is easy to summarize and difficult to change: Maine island and working waterfront communities have come to depend on the economics of a $5 per pound lobster during the all-important fall lobster harvest season, while the forces of global supply and demand have priced lobsters much closer to $3 per pound during the last year, a price which shows no sign of improving anytime soon-if ever.
In order to understand the magnitude of the challenge confronting lobster communities, we need to begin with the fact that for most of the past 15 years, lobster supply and their prices both increased dramatically. Indeed, Maine lobster harvests actually tripled since the early 1990s, while prices kept ticking up due to an increase in worldwide demand, culminating in the fall of 2007 when prices to lobstermen briefly hit $7 per pound. But then reality set in. The biggest customers for Maine lobsters-enormous buyers like Red Lobster, Outback Steakhouse and various cruise lines, which have become the major markets for Maine lobsters distributed by Canadian processors (and thus no longer Maine lobsters), pushed back hard. These dominant buyers simply said they would not continue buying lobster tails and lobster meat, priced at $20-$25 per pound after processing, but would instead substitute shrimp, spiny lobsters and langoustina (a cheap imitation lobster) on their menus. And they enforced their market power, which lowered prices.
Many lobstermen believe that the low prices, which have hit them like a tsunami, result primarily from a conspiracy between dealers and distributors to keep prices low. But this fear misses a fundamental point: one of the unfortunate side effects of the tripling of Maine lobster sales from 20 million pounds in the early 1990s to 60 million pounds by the year 2000, was that Maine lobsters essentially became an undifferentiated product in the market place. The big buyers at chain restaurants and cruise lines, which absorbed the astounding increase in landings, do not care where their lobsters are coming from. And everyone in the business-from harvesters to dealers to distributors and processors-have been so busy pushing product off boats, docks and 18-wheelers headed to Canada that no one cared that the Maine lobster brand had lost its identity. Now the bad habits of the past are coming back to haunt us.
The Governor’s Task Force on the Economic Sustainability of Maine’s Lobster Industry is about to release a Strategic Plan for re-investing in the Maine lobster brand to create new markets willing to pay a premium for a locally caught Maine lobster. This strategy will remind consumers that Maine lobsters come to them from fishermen who take pride in the quality of their product, which is harvested from pristine waters and sustained through a long history of conservation practices. This is essentially the strategy that the Midcoast Fisherman’s Association is employing through its successful “Port Clyde Fresh Catch” campaign.
The fundamental concept here is one that is also sweeping the nation with respect to much of what we eat. It’s the local food revolution. The lobster industry can benefit from identifying Maine lobsters with the widespread belief that locally produced foods are inherently more healthy, more nutritious and more sustainable than foods produced by large corporate conglomerates, which produce foods that reach your plate only after long periods of time and costly transportation routes requiring all kinds of unhealthy interventions to preserve appearance.
It is not clear whether Maine lobsters can recapture a valuable niche in local food markets throughout the United States, since live lobsters have been accurately described as the most perishable food product on the planet. But it’s worth a substantial public and private investment in the Maine lobster brand because the alternative is a lobster industry that will shrink by 20 to 30 percent within the next few years if we do not act.
If lobsters are the economic linchpin of Maine’s island and working waterfront communities, their Achilles heel is the cost of energy required to sustain them. And we’re not talking just about the cost of electricity, which ranges from 28-30 cents per kilowatt-hour for four island communities and up to 70 cents on three others. What we are really talking about, as George Hart of the Ocean Energy Institute has repeatedly emphasized, is the cost of all of the energy we use in Maine.
Maine is the most heavily dependent state in the country on imported fossil fuels, not just to turn the lights on, but also to heat our homes and run our cars, trucks and vessels. Fully 87 percent of the energy we use in Maine comes from fossil fuels-much of it from places in the world that do not much care what happens to us. As former governor Angus King has put it, if energy prices reach the level of last summer and stay there, all of Maine will become a National Park because almost no one will be able to afford to live here.
Island communities “get it” because their energy bills are already acutely high. Thus they have become leading-edge communities in support of the development of wind and tidal power alternatives. Recently at a major international ocean energy conference in Rockport, Maine’s Gov. John Baldacci and other local dignitaries, presented Maine’s case for what we offer the region, the country and the world in our aspirations to become a major supplier of ocean energy. Maine offers world-class wind resource, a committed university research capability in new composites and manufacturing expertise, an experienced work force anchored by companies such as Cianbro and Bath Iron Works and the political leadership determined to streamline regulatory reviews. At the end of June, the Fox Islands celebrated the groundbreaking ceremony for its 4.5-megawatt wind farm, which will be the largest on the New England coast and the second=largest off the East Coast of the United States.
Maine has always been at the end of the line geographically and we have always paid dearly for the cost of importing commodities that others can acquire more cheaply. One of the best ways to turn the tables on our geographical situation is to invest in the kinds of technology needed to produce local food and local energy. The Maine coast grew wealthy during the 19th century by producing a great deal of its own food and harnessing the power of the winds in the Gulf of Maine to transport its products near and far. By revolutionizing the way we produce food and energy, we can achieve the kind of independence that has shaped Maine’s distinct history and culture.
Philip Conkling is the president of the Island Institute.