Lobster pinches on menus despite record-low prices

Written By Unknown on Kamis, 20 Desember 2012 | 22.55

People in Atlantic Canada can scoop up a lobster for as little as three dollars a pound these days, but restaurants aren't serving the same deals.

The region is seeing a glut of lobster this year, sparking roadside sellers to offer their product for $5. If people go directly to the wharf, they can buy a lobster for a record-low $3.

But the same can't be said at restaurants in the Halifax area, who are charging significantly more for their lobster dinners.

At the Five Fishermen restaurant, a pound-and-a-half lobster dinner is currently selling for $39. At the nearby Press Gang, it's going for $43. Diners at McKelvie's will pay $35 for the lobster supper.

Geoff Irvine of the Lobster Council of Canada said one of the reasons for the difference the number of people who handle the lobster, including shippers and distributors, who have to be paid.

"There's a whole value chain that we can work back on that. But at each stage – the first buyer, the local distributor, and the food service operator – have contribution margins. It's profit."

Irvine estimated a $30 plate of lobster would only yield a profit of about $3 at a restaurant.

Restaurants are also losing a bite out of their profit because the cost of so many other products is soaring, said Luc Erjavec, a spokesperson for the Canadian Restaurant and Food Services Association.

"It doesn't matter whether you're looking at beef, diary, alcohol, electricity, rent, taxation, wage rate, they're only going up," he said. "While the price of lobster may fluctuate and cushion the operator from a further price increase."

Erjavec and Irvine agree restaurants set their prices based on what they believe people will pay.

With files from Bob Murphy

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