2013 Economic Outlook Summary

The following table summarizes the general trends anticipated in the average landed price for Canadian snow crab, lobster, shrimp and Atlantic cod for the 2013 fishing season. Estimates were developed using statistical modelling of factors influencing the landed price received by Canadian fishers (Table 4). The "Landed quantities", "Exchange rates", and "Economic growth" columns provide the prospects for each variable, all things otherwise being equal. The expected combined effect is presented in the "Total" column. ^{Footnote 1}

The following is a summary description of each species-specific outlook:

Snow crab

The outlook for Snow crab prices indicates a slight increase for 2013, mainly influenced by the announced 25% reduction in the Alaskan snow crab total allowable catch (TAC) for 2012-13. The expected depreciation of the Japanese Yen is a potential source of uncertainty, as there is considerable variation in the forecasts ranging from no change to a 10% weakening of the Yen in relation to the Canadian dollar in 2013. ^{Footnote 2} While Japan is a relatively small export market for Canada, Japanese consumption of snow crab is high and is an important factor in determining the world price of crab. The current Snow crab outlook is based on the average forecast of six major Canadian banks of a 5% depreciation of the Yen in relation to the Canadian dollar. ^{Footnote 3}

Lobster

Lobster's landed prices are heavily influenced by changes in North American supply of lobster. ^{Footnote 4} The 2012 lobster season has clearly demonstrated this, as supply gluts caused landed prices to plummet in the US and Canada (see section on Key Markets). Assuming that lobster supply remains stable relative to 2012, the forecasting model suggests that lobster landed prices could increase 3% in 2013 (i.e. relative to 2012 prices). These results must be used with extreme caution, as a sensitivity analysis suggests that an increase in Canadian landings of 10% could instead reduce prices by 9% in 2013. In addition, uncertainty surrounding the fiscal challenges faced by the US could affect the economic growth forecasts for the US economy, which could have a negative impact on the demand for Canadian lobster.

Shrimp

Despite a 38% reduction in the North Atlantic Fisheries Organization (NAFO) Division 3L quota in 2012, wholesale prices for northern shrimp have fallen slightly throughout 2012. A further 22% TAC reduction planned for 2013 ^{Footnote 5} is expected to lower supply and put upward pressure on Northern shrimp landed prices. ^{Footnote 6} The economic growth forecasts for EU economies, one of Canada's major shrimp markets, suggest a potentially negative impact on demand for shrimp, which could counterbalance supply side effects. Overall, the outlook suggests little change for 2013.

Cod

The model indicates a decline in landed prices for Atlantic cod. While TACs in the Gulf of Maine are expected to fall, model results indicate that even significant shifts in the North American supply are unlikely to substantially affect the price. Rather, the expected depreciation of the US dollar and the Euro with respect to the Canadian dollar are the most significant factors. The risk of weaker than expected US GDP growth resulting from measures to tackle fiscal challenges could negatively affect the Canadian landed price of Atlantic cod.