Fuel price drop cold comfort for fishermen
By Mark N. Schieldrop/Independent Staff Writer
South County Independent
NARRAGANSETT — The recent drop in fuel prices has been a welcome relief for the struggling fishing industry, but fishermen say they are still trapped in a sea of complex regulations and declining market forces.
For lobstermen, the economy has affected their livelihoods particularly hard in recent months. Lobster is considered a luxury item and consumers have been cutting back all year on nonessential expenses. When the credit crisis hit the global markets earlier this fall, Canadian distributors watched their lines of credit with Icelandic banks freeze up and, in an instant, were unable to sell lobster meat on the global market. With no way to ship millions of pounds of Maine and Rhode Island lobsters, the local markets began to overflow with product, leading to a precipitous drop in lobster prices. At about $3 a pound, lobster meat is half as expensive as it was a year ago.
“We have excess product sitting around and it’s perishable goods,” said Lanny Dellinger, director of the R.I. Lobstermen’s Association. “We’re trying to move it, but people ain’t buying.”
Meanwhile, the population collapse that hit the Rhode Island lobster population in the past decade seems to have bottomed out. Fishermen are seeing more lobsters and believe the population is on the rebound. Lobstermen who notched egg-bearing females and collaborated with scientists find the collapse in lobster prices especially frustrating.
“We’ve jumped through all sorts of hoops to rebuild the resource, and then the whole world economy tanks,” Dellinger said. “All we can do is hope the resource continues to get better as the economy eventually gets better.”
Even though the price of diesel fuel at the docks in Galilee is down about 50 percent since the summer, the 100 percent drop in lobster prices means it’s even harder to make a profit from a catch. It costs at least $500 just to leave the docks and bait prices are still high. As a result, many lobstermen aren’t going out in rough weather and are extending their trap lines and putting more bait in their traps to reduce their time at sea.
“Everyone has slowed down,” Dellinger said. “Nobody is willing to get beat up to get nothing.”
Mark O’Neill, owner of Galilee Fuel Service, said fishermen are happy that diesel prices have dropped from their summertime highs, but it’s a short-lived comfort.
“It certainly helps, but [fishermen] have other battles to fight,” O’Neill said. “Their fuel consumption hasn’t gone up, so it’s not like they’re going out to fish more. The one thing that lower prices has done is make it easier on our guys in the collections area.”
O’Neill himself is feeling some relief from the summer’s record prices. With lower prices, his profit margin is under less of a squeeze. When prices were at about $4.50 per gallon, he had to stop taking American Express cards because of the 3.5 percent service charge tacked on to each sale.
“With a small profit margin to begin with, 3.5 percent on $4.60 means you’re going backwards,” O’Neill said.
Still, the drop in fuel prices is remarkable. From a summertime high of $4.50 a gallon, today’s price has dropped to about $2.50.
Chris Brown, president of the R.I. Commercial Fishermen’s Association, said that fishermen are in a “very dangerous” situation because of the sagging economy and lower market prices. Lower fuel prices have helped ease some of the pressure, Brown said, but market forces and the declining economy seem to outweigh the gas price drops. Still, fishermen will take all they can get right now.
“The drop in fuel prices is a help, but it’s still a bad situation out there,” Brown said. “I guess if you’re a drowning man, you don’t care where your next breath comes from.”
Brown said as people eat out less, restaurants will invariably buy less fish. And during this time of year, people are more interested in buying turkey, ham and other proteins, so it’s a slow time of year for fish products in general.
“There’s a twofold effect on us,” Brown said. “The first thing is the consumer, and then they’re not going to restaurants and a lot of the fish we sell is destined for restaurants. So we take it on a couple of different levels. It’s a very bad situation.”
Brown said fishermen are still fighting with regulators over ways to streamline and de-complicate the regulatory process. One option being pitched by a group of fishermen is sector allocation, which would grant a select number of fishermen exclusive rights to a fixed percentage of the fishery. The R.I. Marine Fisheries Council is in the midst of a heated public hearing on whether to roll out a trial sector allocation program for the fluke fishery.
Under sector allocation, members of the fluke sector would have the right to fish virtually any time they wanted and could ignore daily quotas, days-at-sea limits and other regulations that fishermen say make their jobs next to impossible.
Supporters of the plan, which include some members of the R.I. Commercial Fishermen’s Association, say that myriad fishing regulations are counterproductive. Fishermen often find themselves throwing perfectly good fluke overboard because of daily quotas or being forced to fish when conditions aren’t optimal.
Some fishermen who are not part of the group pushing for sector allocation say that the program would give a select few fishermen exclusive control over the fishery. They worry that the sector members would fish only when prices are high and non-sector members would have to ride their wake and pick their scraps, or else fish when prices are low and profits are slim.
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