Hail-at-sea electronic auction to be implemented for shrimp

Trevor Taylor, Minister of Fisheries and Aquaculture, today announced that he intends to implement a hail-at-sea electronic auction for shrimp in 2004.

On January 22, 2004, Minister Taylor advised Fish, Food, and Allied Workers (FFAW) and shrimp processor representatives that unless they could provide, by January 30, a joint proposal on how to address chronic structural problems in the inshore shrimp sector, he would impose a solution. Minister Taylor indicated at that time that the need to improve the economic viability of the industry left him with no choice but to act.

"I was disappointed, but not surprised, to be advised by the stakeholders that they could not reach a consensus solution," said Minister Taylor. "The structural problems and other challenges facing this sector of the industry were well documented in the 2001 Report of the Inshore Shrimp Panel and could have been addressed through implementation of the plan developed last fall by an industry working group led by Gabe Gregory and Bill Broderick. Having been advised that no agreement can be reached on this basis, I was left with no option but to act in the best interests of the industry. The shrimp fishery is simply too important to the economy of the province to allow the current situation to continue."

Under the system proposed by Minister Taylor, all shrimp processors operating in the province would be required to purchase raw material through an auction. This auction would be operated by an independent body and overseen by the Department of Fisheries and Aquaculture. In a hail-at-sea electronic auction, a vessel operator, upon departing the fishing grounds, would hail-in to the auction house indicating his port of preference, quantity, and quality of shrimp on-board and estimated time of arrival. This information would then be communicated to all shrimp processors who would tender bids to the auction house within a specified period of time. The auction house would relay the successful bid and landing details back to the vessel.

"Processors say they are prepared to reward harvesters for landing quality raw material to plants on a timely basis, and harvesters maintain they want to be rewarded for landing quality raw material to plants when the plants want it," said Minister Taylor. "As they have been unable to agree on how best to achieve these objectives, I see no reason why an auction system cannot meet the needs of both groups. Many of our international competitors in the shrimp industry use auction systems with great success, and as the old way of doing things here in our province clearly has not worked, it is a good time to try another approach."

The Department of Fisheries and Aquaculture will begin immediately to consult with the FFAW and shrimp processors on the operational details of the auction system.

Media contact: Alex Marland, Communications, (709) 729-3733

2004 02 04                                        4:30 p.m.