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The Coastal Packet

The longtime national journal, Progressive Review, has moved its headquarters from Washington DC to Freeport, Maine, where its editor, Sam Smith, has long ties. This is a local edition dealing with Maine news and progressive politics.

1/2/10

THE ECONOMICS OF A POOR LOBSTER TRADE

Bernard Simon, Financial Times, UK - At a time when prices for commodities such as tea, cocoa and sugar are soaring to their highest levels in years, lobster, a delicacy associated with luxury living, is selling at bargain prices.

Prices have sunk so far over the past two years that some mass-market restaurant chains have added lobster to their menus. Tennessee-based Ruby Tuesday, with about 850 outlets in the US, offers lobster tails, as well as lobster carbonara and lobster macaroni and cheese

Hannaford Supermarkets, a New England chain in the heart of the US lobster industry, has the crustacean on special this week at $4.99 a pound, half the price of halibut.

The lobster fishery's woes are closely tied to the global financial crisis, which has shrunk demand for a delicacy long associated with celebration.

The credit crunch has also deprived North American and European processors of working capital. Icelandic banks, among the most prominent casualties of the meltdown in the markets, were big lenders to the seafood industry.

Bank of Montreal, a big lender to Canada's east coast fishery, urged Canadians this week to make lobster part of their New Year festivities.

"Canadian lobster fishers need your support," the bank said. "You'll be having a treat and helping out your fellow Canadians at the same time."

The Canadian industry, which makes up the bulk of the North American catch, employs about 30,000 people, with exports last year of close to $950m. . .

"It's not easy to get into the business, so it's not going to grow," says Bob Bayer, director of the University of Maine's Lobster Institute.

"The problem now is that the stock market is picking up, but casual dining is most affected because people are still losing their jobs," said Michael Tourkistas, chief executive of a large Maine-based distributor. "We're not out of the woods yet.". . .

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