The Honourable Steve Crocker, Minister of Fisheries, Forestry and Agrifoods
Speaking Notes for the Standing Committee on Fisheries and Oceans (Northern Cod Stock)
September 26, 2016

Good morning and thank you for the invitation to speak here this morning.

The Northern Cod stock stretches from the Grand Banks to the south coast of Labrador. Historically, it was one of the largest cod stocks in the world and was the main reason people settled along our east, north east, and southern Labrador coasts.

The collapse of the northern cod stock and subsequent closure of the fishery is described as the largest layoff in Canadian history.

It is generally acknowledged that there are several reasons for the collapse. Overfishing, environmental changes and poor management all played a role, and while it is important to learn from this history, I do not want to dwell on the past.

Today, as the stock rebuilds, we have an opportunity for a renewed groundfish fishery with northern cod once again at the forefront. It is extremely important that we rebuild this fishery in a sustainable manner for our fish harvesters, processors, workers, and coastal communities.

As we work to achieve economic and environmental sustainability we must also seek to achieve social sustainability.

As the lucrative snow crab and shrimp stocks decline we must ensure that our cod fishery reemerges as an economically viable fishery and we must optimize the value of the resource for stakeholders.

As we move forward we must do so with a northern cod rebuilding plan that allows for the continued growth of the stock and also the rebuilding of the cod industry. This rebuilding plan should follow a precautionary approach to resource management. Today, management plans require these elements in order for fisheries to achieve market certifications, including Marine Stewardship Council certification. I will speak in more detail about markets shortly.

I believe it is also important to take an enhanced ecosystem approach to management of northern cod.

While managing the entire marine ecosystem is virtually impossible we can better integrate the management of important forage species such as capelin with our management objective for cod. We can also consider the impact of competitors and predators such as seals in the management approach for cod.

In order to do this, we must have guidance from the science community. With the Federal Government’s renewed investment in, and commitment to, fisheries science, we put this work forward as a science priority for the Newfoundland and Labrador region.

In anticipation of the rebuilding of the Northern cod stock, preparation is underway for the transition from a dependence on shellfish to a more diversified fishery with an emphasis on groundfish.

Our government is committed to working with industry to develop markets for a revitalized cod fishery in Newfoundland and Labrador.

One key approach is to promote and support opportunities to enhance market access and continue to focus on maintaining top quality from initial harvest through to final market preparation.

Our government has already started work toward this goal with the Seafood Innovation and Transition Program, which recently awarded $1.8 million to 27 projects that have a strategic focus on the return to a groundfish based fishery.

Cod is still one of the most important species in the global seafood market. However, market dynamics have changed considerably since Newfoundland and Labrador was a major player in the cod business back in the 1970s and 1980s.

Today, the largest players in the Atlantic cod fishery are Norway, Russia, and Iceland which account for more than 80 per cent - more than one million tonnes - of global supply. There are also millions of tonnes of other substitute whitefish species, both wild and farmed.

It is important to recognize that Newfoundland and Labrador has an extremely small share of the current global cod market.

In 2015, our province exported just over 1,100 tonnes of cod fillets, or 0.0036 per cent of the world total.

The large volumes of H&G cod on the world market in recent years have resulted in a huge growth of twice frozen fillets and blocks primarily processed in China which are dominating global cod markets.

The largest markets for cod are fresh and frozen fillets in the United States, frozen fillets in the United Kingdom, and salted cod in Portugal.

Currently, the Newfoundland and Labrador cod fishery primarily produces single frozen fillets and portions in the form of loins and tails, for example. Single frozen Atlantic cod sells at a market premium above twice frozen cod and frozen at sea cod, but high quality is imperative to maintain that price level.

If our industry does not produce and sell a high value cod product, it will be difficult for us to compete in the marketplace with high quality producing countries such as Iceland and Norway. More importantly, we have to avoid the volume driven commodity market dominated by China and other countries that are able to produce low-cost product.

The marketing challenges our industry faces with respect to transitioning back to cod include:

  • Logistical issues of transporting fish off the island particularly for fresh cod markets;
  • Positioning ourselves to compete with existing global suppliers;
  • Producing and marketing a consistent supply; and
  • Producing and maintaining a consistent quality throughout the supply chain.

Sustainability is a key issue with regard to market access. Today, all major cod, haddock, pollock, hake, and most flatfish fisheries are Marine Stewardship Council (MSC) certified. Most retailers will not buy groundfish that is not certified as meeting FAO responsible standards either through the MSC or other rigorous certification programs.

We recognize that our industry needs time to transition from shellfish back to groundfish and this will not happen overnight. In order to build a vibrant industry a greater level of support will be required from all players.

We have begun work to establish a Fisheries Advisory Council that will be immediately tasked with developing an action plan on cod revitalization. This council will be comprised of representatives of all sectors, including the general public, to ensure all stakeholder interests are considered. We are pleased that the Federal Government will participate in the Fisheries Advisory Council, once established.

The importance of coordination of federal and provincial policies to support the cod sector particularly as the industry transitions can’t be overstated. It is imperative that we work together to optimize the value from the limited resources that are harvested and processed. The two sectors are linked and the policies in one sector ultimately impact the other.

As the province continues to restructure our fishing industry, it is essential that allocation decisions be based primarily on adjacency and historical dependency.

We believe strongly that fisheries management decisions such as the setting of TACs should be based on scientific advice in order to protect against the overexploitation of resources and allow for long-term sustainability of the fishery.

In closing, I believe the only way to truly achieve our collective objective regarding the northern cod fishery is by all parties working together. Both levels of government have an important role to play in the management and regulation to ensure we have a well-managed fishery, providing a high quality product to world markets. Government can only successfully implement the necessary measures through discussions and dialogue with industry stakeholders.

I, as Minister of Fisheries, Forestry and Agrifoods, am certainly prepared to engage in discussion with all parties so we do this right.

We can’t afford not to.

Thank you.