Seafood-pricing system is flawed and a new one needs to be in place by end of January, says report

A new report from the Newfoundland and Labrador governmentsays the current seafood price-setting process is flawed, and it outlines the need for a formula-based system that would improve the industry for harvesters and plant owners.

The report was sparked by a tie-up in the spring that delayed the start of the snow crab fishery. Prices were set at just $2.20 per pound at the start of the season, and the Fish, Food & Allied Workers union and Association of Seafood Producers failed to produce an agreeable pricing formula.

It says the currentprocess for price setting, which is done by a panel,is flawed and that the panel has an "impossible task" when faced with a fluctuating market.

"It has to be corrected, and this report is a way forward," FFAW president Greg Pretty saidThursday."[The report] is a very astute, sharp post-mortem of the past season, but it also looks at how we got hereand plans out a good path for the future."

The report from a three-person team appointed by the government in September to review the current system,offers nine recommendations, including implementing formula-based pricing by the end ofJanuary, ensuring a new formula is set months before the season starts, and establishing an independent fisheries management structure.

Pretty said he was especiallypleased to seethe need forall parties to have more comprehensive data before the price-setting process, saying it will create a more level playing field and incorporate market price increasesbetter than the previous system.

"If the market increases, it will give returns to harvesters. We haven't had that in the past, and that's something that's critical to the future," he said. "There's an opportunity to do this thing right this time."

Tie-up was avoidable, says report

The report, issued Thursday, concluded much of the disruption caused by the tie-up of the snow crab fishery was likely avoidable.

Jeff Loder, president of the Association of Seafood Producers, said the recommendations show a clear and obvious effort to ensure that history doesn't repeat itself.

"We've seen this year what happens when you don't have a stable system for setting prices," he said."It also highlights the need to get tothe table and to work through all of the issues that contribute to creating value for fish species."

On Thursday, Environment Minister Bernard Davis and Fisheries Minister Elvis Loveless said they welcomethe recommendations from the report anddon't want a repeat of this year's headaches in the spring.

While some of the recommendations would require legislative change, Davis said they wouldn't impede the start of next season.

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