Snow crab fishery soars in value (now how to make it even better next year)

Mark 2021 down as the Year of the Snow Crab — with a landed value estimated at $640 million, the best in Newfoundland and Labrador history, representing an incredible 246% rise over last year.

The entire 2021 snow crab quota in waters around Newfoundland and Labrador has been taken. Find DFO's quota report here.

The great crab year was born from the precious combination of increased quota (38,186 tonnes — up 29% from 2020), and record price of $7.60/lb.

But the trick Newfoundland and Labrador has never mastered is how to create consistent, lasting prosperity from its fisheries — a delicate balance of price and supply.

Of course, that's a job to do when price is dictated by outside forces, and control of the fish is in someone else's hands.

Ottawa's absolute control aside (for now). NL harvesters must be positioned to get the best possible price for their product. That's good business (with the added weight of the rural economy that harvesters carry with them).

Question is, did harvesters get a reasonable share of market returns this year?

I would say no, that wasn't possible under the province's panel system of fish pricing.

Once the three-person panel set the 2021 price of crab in stone on April 25th, the legislated system did not allow for another price appeal when international crab markets continued to rise.

As SEA-NL wrote in a letter to the St. John's Telegram:

"When the market price of a species like snow crab continues to rise after the price to harvesters has been set — with no way for harvesters to appeal that price — than the system must either be overhauled or scrapped."

SNOW CRAB BOOM

On July 6th, seafoodnews.com reported that the price of snow crab as “inelastic,” meaning that that no matter the price consumers are still prepared to buy it — putting it in the same category as necessities like medicine or utilities. (Find it here.)

The fact that fishermen were not able to tap into that rising crab price is an obvious weakness of the panel system that — if addressed — would better ensure harvesters receive a fair market share.

In 2018, there were 2,431 licensed crab harvesters in Newfoundland and Labrador. Find the numbers in DFO's management plan here.

A healthy and prosperous snow crab fishery — one that will draw young people in, and drive the rural economy — isn't possible without a healthy resource.

Crab landings peaked in 1999 at 69,131 tonnes, but declined year over year since then to stand at 38,186 tonnes today — a 45% drop.

That said, this year's snow crab quota was up 29% from last year.

Click the headings below for tonnage, and price per pound.

NL SNOW CRAB LANDINGS DOLLAR VALUE PRICE PER POUND

2021 — 38,186 tonnes $640 million $7.60

2020 — 29,551 tonnes $185 million $3.50

2019 — 29,579 tonnes $303 million $5.38

2018 — 28,083 tonnes $298 million $4.97

2017 —33,605 tonnes $325 million $4.39

2016 — 41,745 tonnes $274 million $3

2015 —47,099 tonnes $258 million $2.45

2014 — 49,761 tonnes $258 million $2.30

2013 — 50,634 tonnes $220 million $1.83

2012—52,462 tonnes $217 million $1.95

2011 — 52,951 tonnes $251 million $2.15

2010 — 52,229 tonnes $155 million $1.35

• 1999 — 69,000 tonnes (peak)

DFO's scientific assessment of snow crab in the NL region this past February said scientists are seeing "modest improvements," except off Labrador and in the Gulf.

The below page is from that assessment:

Make no mistake, snow crab is the main driver of the Newfoundland and Labrador fishery, but there's always a danger with reliance on a single species (think offshore oil).

Lobster is the province’s second most valuable fishery — a value that the FFAW has estimated will reach up to $200 million by 2024, double the 2019 value — but that's still far behind snow crab.

Ryan Cleary,

SEA-NL

Independent licensed owner-operators are encouraged to join SEA-NL here. These blog posts will be public for a limited time, before becoming exclusive to the membership.