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Presentation to the Standing Committee on Fisheries and Oceans

September 27, 2016

On Monday, September 26, FFAW-Unifor President Keith Sullivan presented to the House of Commons Standing Committee on Fisheries and Oceans. The Committee is currently undertaking a study on northern cod.

Good morning members of the Committee. I’m Keith Sullivan, the President of the Fish Food and Allied Workers Union, which is an affiliate of Unifor. The FFAW is the largest private sector union in Newfoundland and Labrador with more than 12,000 members. The vast majority of our membership work in the fishing sector, either as fish harvesters or plant workers.

It is understood that the cod fishery has a deep connection with the people and history of Newfoundland and Labrador. I’ll talk about the value of the cod fishery to FFAW members and our communities. The FFAW union movement started in 1970 when the price of cod was 2.5 cents per pound. Back then, we didn’t refer to cod as “cod”, it was known as just fish. Cod was our fishery and our identity. The northern cod moratorium of 1992 put tens of thousands of FFAW members out of work and dependent on a government subsidy program.

The calamity of the cod moratorium forever changed the relationship between the fish harvesters and the fisheries. This change applies to all aspects of the fishery, from fisheries science, to marketing, to management.

In the wake of the moratorium, it was critical that fish harvesters and the FFAW establish a larger role in fisheries science. To that end, over the past 25 years, the FFAW has developed a full fisheries science program on a variety of species. The Union also has a full-time fisheries scientist on staff. When DFO discusses matters of science, we are in the room with a knowledgeable voice.

With respect to cod, our two most important science program are cod sentinel and cod tagging. Sentinel started after the moratorium as a response to the deep disconnect between what harvesters were seeing on the water and the results of the stock assessment conducted by DFO in the years prior to the moratorium. Before the moratorium, information from the inshore harvester was not systematically collected and used to inform the management of the stock. Up to the moratorium, information on abundance was collectedfrom the catch information of offshore vessels that fished when cod were aggregated and vulnerable. There was limited information from the inshore feeding period for cod.

The cod sentinel program was designed to systematically collect information from the inshore for use in stock assessment and management. From the cod sentinel we have a record of catch rates and other biological information from the inshore.

The information that the FFAW collects from its tagging program is crucial. Tagging provides a direct estimate of fishing mortality. Tagging allows us to estimate the amount of cod removed during a season, even accounting for the recreational fishery.

Our tagging program is conducted in partnership with DFO, and it involves attaching flow or spaghetti tags to northern cod in inshore waters. In fact, just this week, two of our at-sea fisheries technicians are traveling to the Northern Peninsula and Southern Labrador to tag northern cod.

So, what are our science programs telling us? Well, in sentinel, catch rates have increased substantially over the past five to ten years. The increase started in 3K, where an experimental net that once caught 4 fish was now catching 15. In 2J, the increase was slower in developing, but in time catches from experimental nets in the area jumped from 1-2 fish to up to 30.

What this means is that catch rates are much higher than what they were at the beginning of the moratorium, particularly in 2J where for the first 10 years of the sentinel catch rates average 1-2 fish per net.

With respect to mortality, the level for this stock is very low at the moment. Fishing mortality refers to the mortality of the species from fishing over the year. For the past 3 years, fishing mortality in the northern cod stocks was 2%. To put this into historical perspective, during the 1980s, the fishing mortality rate was around 20%. We are currently at one-tenth of that rate. More importantly, biomass is expected to grow considerably over the next 3 years, which is the projection period of the latest stock assessment.

What all of this points to is the long awaited return of the northern cod stock and its corresponding environmental shift. Harvesters and processers have been primarily focused on shellfish for the past 20 years and now we expect that focus to return to groundfish, not just cod, but also redfish, turbot, and others.

Though we are encouraged by the return of cod, we have not lost sight of the importance of conservation. There is no harvester in this province that wants to relive the challenges of the cod moratorium. The new cod fishery is going to be managed correctly. To that end, this we have the World Wildlife Fund, processing companies and FFAW members attending a meeting on the Fisheries Improvement Project for northern cod that we are all partnered on. This is a multi-year partnership with the goal of meeting sustainability standards as the new cod fishery develops.

This shift back to groundfish is both exciting and challenging. The cod fishery is fundamentally different than shellfish – harvesters know this, as do the processing companies. With snowcrab and shrimp, our fishery was a major source of the market; that is not the case for cod. For cod, there are several large cod-producing countries around the world and right now Newfoundland and Labrador is but a relatively small part of the total cod market.

In the many discussions and debates on how to approach northern cod as it returns, the one point we came back to is that we would approach the cod fishery in a much different way than before. Prior to the moratorium, we were a quantity based fishery, serving the fish stick market and so on. As we rebuild the cod fishery, our focus in on quality. This is a deliberate and necessary shift for the harvesters of this province.

With quality in mind, the FFAW, as part of the Newfoundland and Labrador Groundfish Industry Development Council, has developed a “Plate to Ocean” approach for the commercial cod fishery. In Plate to Ocean, we are looking first to see what the market needs and where the most value can be achieved and then we are building our cod fishery to meet those needs. For example, we know that there is a demand for high quality fresh or once-frozen cod for white tablecloth restaurants and for higher-end consumers.

These markets exist in a variety of places.  Icewater Seafoods from this province, for example, serves a market in Britain and continental Europe. Iceland has vastly increased the value of its cod fishery by providing fresh cod to the Eastern United States. With our current connections to Europe and our proximity to the US, we think that the Newfoundland and Labrador fishery will eventually become a big player in the high end fresh or once frozen cod market.

While it is important to tie our new cod fishery to market needs, we also need to build a fishery that works for our harvesters and plant workers for the future. Harvesters need to be able to land high quality cod and they need to be compensated according to the value that they are bringing to the industry.

The first thing that needs to be done, and it is within the power of the federal government to do so, is to protect the owner-operator principle. The attack on the owner-operator principle over the past 20 years, primarily by processing companies but not exclusively so, has been terrible for the economics of the fishery and coastal regions.

Of particular concern is the impact that trust agreements (method of undermining owner-operator and fleet separation policies) have had on the cost of fishing licenses, which has made it extremely difficult for young people to enter. Processing companies, with their large resources, have circumvented owner operator and fleet separation policies and have bid up the price of crab and shrimp licenses to the point that only well-established harvesters or processing companies can afford to pay.  Harvesters in trust agreements also often receive less for their catch.

Fortunately, the impact of trust agreements on the cod fishery appears to be small,  but this could change, particularly as the value of the cod fishery increases and the importance of the cod fishery to the processing companies increases.

The owner-operator principle needs to be protected.

A focus on quality also requires an understanding of what a quality cod is and how a quality cod can be landed. As I mentioned earlier, the pre-moratorium fishery was not focused on quality. Also, harvesters in this province have not landed northern cod in any large quantity in 25 years and we must ensure we perfect the art and science of modern a cod fishery.

We have spent a significant amount of time with all levels of the industry on fully understanding what constitutes a quality fish. For the past two years we have been engaged in a cod quality project in partnership with ACOA and the provincial government where teams of harvesters monitor a whole host of variables when cod fishing, from the temperature of the fish to how it is handled when removed from the net or hook. When this process is finished, we should have a comprehensive guide for achieving top quality cod and we will be able to disseminate this information to all harvesters in the province.

Harvesters also need to be properly compensated for providing quality fish. On this point we have made important steps. For the past three seasons we have had a quality-grade price system, where a grade A cod receives a higher price from a grade B cod, and so on. This has its challenges, but harvesters recognize the need to be paid for their quality and this will be key to increasing value.  The new cod fishery is going to require significant investment, from both a harvester and processor perspective, and for that investment to pay off for the harvester prices need to be good and the fishery needs to be managed and structured properly.

One management change that began this year is having a longer season to allow harvesters to catch more cod so that we can be a steady stream to the market. The best cod – the cod that provides the best price to harvesters and processors – is one that is landed and quickly shipped to market. We need to move away from a condensed fishing season and move to spread out landings and avoid gluts in the processing sector.

In year’s past, harvesters were limited to 5000lb, which they landed in a week or two. This year there are weekly limits for landings but the season is stretched out over several months. We have many harvesters that have landed 15 to 20 thousand pounds of cod this year. One experienced harvester with two licenses has caught over 36,000 lbs of cod this year just using hook and line. It is he and his daughter in a boat each day. Landing 36,000 lbs of quality cod is a positive change to the economics of the cod fishery.

There have also been positive steps taken by the federal government to encourage investment in the inshore cod fishery. Last year during the federal election campaign, Prime Minister Trudeau, , committed to allocate the first 115,000mt of the northern cod quota to the inshore fleet. This allocation existed before the moratorium and inshore harvesters were given every expectation that it would once again exist once a normal commercial cod fishery restarted.

In late July of this year, Minister Leblanc confirmed to me and the senior leadership of the FFAW that this commitment stands – the first 115,000 mt of northern cod quota will be granted to the inshore sector. This is a very important commitment.

We are building a cod fishery from a very small base, at the moment. If we are going to change how we catch, transport, process, and market large amounts of cod, those engaged in that sector need to know that there is a consistent allocation of fish so that they can invest with some security. The commitment to the 115,000mt is the best security the industry and our country can receive. It will give us time to rebuild at a reasonable pace, to build markets, to build expertise in catching and processing quality cod, and to figure out how to best fish and manage the new northern cod fishery.

For the harvesters in Newfoundland and Labrador, the cod fishery is not about revisiting the past. It is about charting a new future. Our hope is that 30 years from now the idea of the cod fishery won’t bring to mind images of 1992 and the moratorium; rather we hope it brings to mind images of 2016, of a man and his daughter catching 36,000 lbs off a hook and line, and of how we started the process of turning the cod fishery into a pillar of prosperity for coastal communities in Newfoundland and Labrador.