Lobster industry seeking bank-style bail out

Fearing a crash of prices, lobster fishermen and processors in eastern Canada are looking for bridge financing from the federal government similar to that being offered other industries around the world.

'We're talking about bridge financing for other major companies across the country and across the world.' — Lawrence MacAulay, MP

Processors and fishermen made presentations on the troubles in the industry to the federal fisheries standing committee in Charlottetown Tuesday. With lobster season opening in about a month, processors still have large inventories in their warehouses. The industry fears the opening of the spring season will take the bottom out of prices.

"Lobsters are going to be worth nothing," said fisherman Wayne Campbell.

"Hate to say that. I preached that we're not supposed to say that. But anyway we'll see, won't we?"

Processors won't say how much frozen lobster they have in inventory, but it was about $30 million in total in January. It's the most ever going into the opening of a spring fishery, said Mark Bonnell of Mariner Seafoods in Montague, P.E.I.

Bankers are hesitant to extend loans to processors to buy more lobster.

"Government's got to move pretty fast here because in four weeks time we're gonna have lobsters coming ashore," said Bonnell.

"Not a lot of packers have the financing in place because of the way the banking industry has been."

MP Lawrence MacAulay, who represents the Cardigan area, helped bring the committee to eastern Canada and admitted while the trip is useful to bring new information to MPs, any recommendations from it won't be made in time to help this spring.

Still, he insists some aid must come.

"We're talking about bridge financing for other major companies across the country and across the world. But we happen to have an industry here too and we need support," said MacAulay.

There are already signs processors are expecting a troubled season. Ocean Choice, P.E.I.'s largest processor, has announced one of its plants in eastern P.E.I. will not be opening this year.