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Snow crab negotiations underway between FFAW/ASP (not on price, but on pricing formula)

The provincial government confirms that talks have been ongoing for months between the FFAW-Unifor and the Association of Seafood Producers to develop a formula to set the price of snow crab — similar to negotiated formulas to determine price sharing in the lobster, halibut, and lumpfish fisheries.

Newfoundland and Labrador's snow crab fishery is Canada's largest, with a 2022 landed value of $758 million — 21% more than 2021's landed value of $624 million, and more than all other commercial fisheries combined. The 2022 price to harvesters was set at $7.60/lb to start the year, but later dropped to $6.15/lb.

An official with the province's labour relations division couldn't say whether a pricing formula would be ready for the upcoming crab season because negotiations are still ongoing.

The recommendation for such a crab-pricing formula came from a 2022 review of this province's fish price-setting system.

The review said a snow crab pricing formula would bring more predictability and fairness to the pricing of snow crab — which, as it stands, has resulted in gains or losses to one party or the other per season in the "tens of millions of dollars or more."

A crab formula would set an initial base price, but later require rebate payments to enterprise owners based on actual sales receipts using a third-party auditor.

Petty Harbour at the start of the 2022 snow crab season.

The pricing formulas in the lobster, halibut, and lumpfish fisheries differ, but they all use an agreed-upon method to determine price sharing.

A price-to market formula has been in place in the lobster fishery since 2011.

And find the 2022 lump row pricing system here.

It is clear the snow crab fishery has been wildly unpredictable in recents years in terms of price, which doesn't work in the long run for either side.

At the same time, the 2022 review noted that a pricing formula had been in place previously in the snow crab fishery, but was "abandoned after it was arguably manipulated by third parties to drive down snow crab prices."

There's that issue of trust again.

Enterprise owners also often complain that the prices of lobster and halibut in this province are much lower than across the Gulf in the Maritimes.

Pricing formulas obviously aren't the magic bullet.

Fishermen could have delivered that message to the 2022 review of the price-setting system, but then they weren't asked.

Ryan Cleary, Executive Director, SEA-NLSeaward Enterprises Association of Newfoundland and Labrador (SEA-NL) is a professional, non-profit organization serving as the distinct voice for licensed, independent owner-operator inshore fish harvesters. You can read more about SEA-NL, and join us here.

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