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Fishing Industry Renewal

The Canada/Newfoundland Fishing Industry Renewal (FIR) Strategy was announced on April 12, 2007. The goal of the Fishing Industry Renewal initiative is to develop an integrated “Ocean to Plate” policy framework and industry restructuring strategy to support the industry “to adapt to changing resource and market conditions; extract optimal value from world markets; provide an economic driver for communities in vibrant rural regions; provide attractive incomes to industry participants; and attract and retain skilled workers.” Elements of the Renewal Strategy will be implemented by the federal and provincial governments according to their jurisdiction; however, the initiatives work together to make the industry more economically viable and internationally competitive.

The Government of Canada’s two major initiatives under the Fishing Industry Renewal Strategy include fleet self-rationalization and changes to Department of Fisheries and Oceans vessel replacement policy.

The Government of Newfoundland and Labrador committed $15 million in direct expenditures to the FIR Strategy. To date, the Department of Fisheries and Aquaculture has made significant progress on all Provincial elements. The Department is continuing to move forward and work with industry on initiatives to support a viable, internationally-competitive and regionally-balanced industry.

Provincial Elements of the Fishing Industry Renewal Strategy:

Agreement on Fishing Industry Restructuring

In July 2009, the Provincial Government reached an agreement with the Fish Food and Allied Workers (FFAW) and Association of Seafood Producers (ASP) regarding the long-term development of the fishing industry in the province. The parties have agreed to a memorandum of understanding (MOU) that provides a plan for addressing the long-term structural issues in the province’s fishing industry. This plan will also contribute to efforts in making the industry more economically viable and internationally competitive.

Processing Policy Renewal

To address a number of challenges being facing the seafood processing sector, including seasonality and overcapacity, the Province has further strengthened its seafood processing policy framework. This work included changes to its fish processing policies and the role of the Fish Processing Licensing Board and will help reduce capacity and increase regional and corporate consolidation. Over the longer term, these measures should increase the industry’s viability and competitiveness by gradually reducing both the number of licenses and the amount of capacity. Changes to the seafood processing policy framework were announced on October 27, 2008.

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Implementation of Fish Auctions

Auctions tend to provide for a more efficient operation of price setting in fisheries and typically provide a stronger link for harvesters to the marketplace. Fish auctions bring market forces to bear on issues related to price and economic efficiency.

In an effort to increase the value of landed fish, a voluntary auction was funded by the province and implemented by harvesters and processors. A pilot project took place between June and September 2008, operated from auction ports at Fortune and Burin and focused on 3Ps cod. The Province formed an independent company, North Atlantic Seafood Auctions Incorporated, to administer this auction for the South Coast small-boat groundfish fishery. Government remains committed to an auction. It brings a strong market dimension to price setting and should help improve product quality and enhance value.

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Enhanced Marketing

The Newfoundland and Labrador fishing industry is faced with a number of marketing challenges, many of which are beyond the industry’s control. In recent years, the industry has had to contend with external factors such as a strong Canadian dollar, trade barriers, increased competition from low-cost producers in under-developed and developing countries, increased purchasing power of retail and food service buyers, and distress selling particularly by undercapitalized firms.

The competitive nature of the processing sector has been a limiting factor in marketing collaboration. To help increase the economic value of our fish resources to the province, there is a need to bring collaborative marketing to this industry. Seafood companies must work more closely together to market their products worldwide. Although a fair amount of cooperation already exists within the industry, there is considerable room for increased collaborative efforts in the marketing of Newfoundland and Labrador seafood.

A Seafood Marketing Review Panel was established in 2007 and carried out a comprehensive analysis of the options for establishing a Seafood Marketing Council. These included identifying key marketing challenges facing the seafood industry and recommending approaches for addressing these challenges, as well as determining the options for the mandate and administrative operation of the Council. Government accepted the Chair’s recommendations to establish the Marketing Council on a 3-year pilot trial provided that industry was supportive. Subsequently, a vote by members of the seafood processing industry resulted in the rejection of the formation of such a body.

The Province continues to assist the fishing industry in meeting current marketing challenges through the pursuit of initiatives to enhance market research and promotion efforts.

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Increased Fisheries Research and Development

Newfoundland and Labrador’s fishing industry continues to be faced with increasing global competition from lower cost producers. It needs to achieve optimal value for the province – the best mix of returns to harvesters, and spin-offs including plant employment and secondary benefits through the development and/or transfer of new and innovative technology to the fishing industry.

The Province supports research & development initiatives which introduce new species, products, markets and techniques to harvest, handle, process and market the marine fish resources of Newfoundland & Labrador.

The Fisheries Technology and New Opportunities Program PDF (1.24 MB) has been created to provide support for harvesting, processing, and marketing initiatives, in order to diversify and increase the overall viability of the provincial seafood industry.

In fiscal 2008/09, approximately 100 applications were received and more than half approved for funding. Approximately $2.1 million in contributions were made to projects costing $6.9 million. This includes funding that was sourced from other government programs, external agencies and the private sector.

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Occupational Health and Safety

The province’s fishing industry, like those in many other jurisdictions, is experiencing occupational health and safety issues in both the harvesting and processing sectors. To enable both sectors to address these issues, Government has approved funding for the establishment and operation of a fishing industry safety council. The structure of this council will be guided by consultations with the Workplace Health Safety & Compensation Commission and industry. It is intended that a safety council will provide advice to Government on health and safety issues and promote safety in the workplace, as well as conduct occupational and health-related research associated with the fishing industry.

Safety Initiatives

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Enhanced Fisheries Loan Guarantee Program

FIR initiatives include fleet rationalization through new rules allowing combining of fishing enterprises and the introduction of three new vessel classes. These new rules necessitate the need for harvesters to access capital for self-rationalization. The Province has implemented enhancements to the Fisheries Loan Guarantee Program.

The Fisheries Loan Guarantee Program provides a provincial guarantee on loans from participating commercial banks to harvesters. To keep pace with inflation and new vessel design and enhancement, Government has introduced a number of changes including an increase in the maximum loan guarantee limit. In addition, loans obtained by harvesters from fish processors are now eligible for refinancing through bank loans under the program.

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Fishing Industry Workforce Adjustment

Rationalization in the processing sector is expected to be a gradual reduction in processing capacity in response to regulatory measures and business decisions. While there will be no active measures by the Province to close processing plants (e.g., processing license buy-out), some plants may close on a permanent basis resulting from corporate decisions or regulatory measures (e.g., the withdrawal of licenses from inactive plants.)

Workforce adjustment supports will be positioned to assist with industry renewal and to facilitate transition out of the industry where necessary. The Province will provide adjustment support measures should a fish plant close permanently. This will include a comprehensive suite of measures to assist during the transition period which will include:

Additionally, the transition support services and job creation activities may help plant workers qualify for retraining opportunities.

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