North American lobster landings, especially in Canada, have been high over the past decade, but now seem to be declining. Maine, the largest producer of lobster in the United States of America, seems especially hard hit. At the same time demand is growing, and the result is a rising price trend.

Supplies

During the first nine months of 2019, Maine lobster landings dropped by about 40 percent compared to the same period of 2018. The main reason for this decline was the late molting in 2019, due to changing water temperatures. Cost of lobster bait went up due to limited availability and this factor also negatively affected landings. Catches further north seem to be improving. For the fourth consecutive year, catches on Quebec’s North Shore rose by about 15 percent compared to 2018. However, these increased landings may also be the result of increased fishing effort.

The lobster season in Canada’s Lobster Fishing Area 35 started in mid-October, but results have been mixed. Although landings have been slow everywhere, fishers reported that the lobsters were of good quality and a big size. Brazil’s lobster industry has been subject to new laws and regulations since 1 January 2019. One change is that harvesters will only be allowed to deliver whole lobsters to processing plants, and any form of commercialization or transport within the domestic market will be prohibited between February and April. The lobster fishing season will start on 1 May and run until 31 October.

International trade

The United States of America – China trade war caused Canadian lobster exports to focus strongly on China, and this paid off. In 2018, Canada took over market share from United States of America exporters, and increased their lobster exports to China by over 81 percent compared to 2017. Nonetheless, this focus on China came at the expense of Canada – European Union trade. The Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union entered into force at the end of 2017, and includes the removal of the 8 percent import tariff on Canadian lobster. Even so, Canadian lobster exports to the European Union in 2018 declined by 3.4 percent compared to 2017. However, in 2019 it seems that Canadian exports to the European Union are slightly up again. During the first nine months of 2019, exports to the European Union increased by 12.2 percent, to 117.4 million CAD.

Experts predict that once the United States of America - China trade war comes to an end, United States of America exporters will retake about 50 percent of the trade that Canada had acquired, which would mean more lobster from Canada going back to Europe. Maine politicians are asking the American government to take action on the trade situation with the European Union. American lobster is still subject to between 16 and 20 percent imports taxes, which should be removed. 

Global trade with lobsters declined slightly during the first nine months of 2019 compared to the same period in 2018, from 131 634 tonnes to 130 550 tonnes. The United States of America remained the largest importer, accounting for 31.6 percent of the total world lobster imports. American imports declined by 5.2 percent, while Canadian imports increased by 20 percent. Following the same pattern, total global exports declined by 13.6 percent. Canada increased lobster exports by 15.7 percent from 65 044 in 2018 to 75 263 tonnes 2019, whereas American lobster exports fell from 34 970 tonnes to 24 979 tonnes during the same period (-28.6 percent).

The European Union registered a slight decline in imports during the first nine months of the year, from 14 080 tonnes in 2018 to 13 450 tonnes in 2019. The largest European Union importer was the United Kingdom. There was a significant increase in Chinese imports, from 28 860 tonnes in the first nine months of 2018 to 34 647 tonnes during the same period in 2019 (+20 percent). Canada, by far the main supplier, accounted for 68 percent of total Chinese lobster imports.

Prices

Maine lobster landings dropped by 40 percent in 2019 compared to 2018, and this has caused prices to increase. Nova Scotia lobstermen indicated that they noticed a considerable increase in demand, leading to higher prices. As consequence, prices also went up for spiny lobster from the Caribbean.

Outlook

There is growing demand for lobster on world markets, especially in Asia. At the same time, the North Atlantic lobster industry is facing declining landings, and the supply outlook for the next 5 – 10 years appears to be rather bleak. Consequently, North American lobster prices will certainly go up. However, this may leave markets for other species, such as the Australian rock lobster and various spiny lobsters. The University of Maine recently released two studies on the effects of climate change on the Maine lobster industry. The main conclusion is that landings in the Gulf of Maine are expected to fall to historically low levels over the next decade. It is also expected that there will be no recovery in the south of New England.

The Maine lobster boom, which started in 1990 and reached its peak in 2016 with 60 000 tonnes), is predicted to end in the next five years. Prior to 1990, annual catches of about 9 071 tonnes were the norm, but since 2010, catches of more than 45 360 tonnes have been recorded. The study predicts that over the next five years, landings will return to average levels.