Free market, not price fixing, pinches crawfish prices
Complaints of price fixing has prompted a coalition of crawfish farmers to petition the Attorney General to investigate the practices of crawfish processors. Louisiana Crawfish Farmers Association director Steven Minvielle alleges that processors collectively drop their buying prices to farmers overnight. However processor and farmer Donald Benoit, who owns D&D Crawfish in Gueydan, and who sits on the Crawfish and Promotion Reasearch Board, says the prices are the work of an industry in transition governed by the free market.
Benoit lists a chain reaction based on demand at the retail end; the high price of fuel, lack of labor, competition from Chinese crawfish, an early season, and the mysteries of the crawfish’s life cycle. Around Christmas, crawfish tails were selling as high as $17 a pound in stores. Yesterday, Champagne’s in the Oil Center was promoting a pound of fresh Louisiana crawfish tails for $8.99. Champagne’s mark up is 99 cents, their wholesale price from the middleman is $8. According to Benoit, $8 a pound crawfish tails works out to 60 cents a pound live crawfish from the farmer, a price that Minvielle says is unsustainably below the cost of farming. “They might have got too low at the stores,” says Benoit, “but it always justifies itself. If it gets too low, the crawfishermen can’t fish, then they got to come back up with the price, then everybody gets back to work. Usually it all takes its own course.”
As the weather warms, crawfish become more plentiful, and the demand is high during Lent, culminating on Good Friday. But because of the early season, Good Friday falls on March 21 this year, many crawfish are still too small to sell on the live market. Small crawfish, in the 60 cent a pound range are “peelers,” and need to be processed to be sold as crawfish tails. Benoit says the labor to peel crawfish is scarce to nonexistent. “There’s not enough processors to handle all the crawfish we got out there. There’s very few processors left in the business. Back in 1999, 2000, we had that Icon problem (a pesticide used on the rice crop that decimated crawfish, which share the same ponds). A lot of the processors went out of business and never came back. Some of it’s a labor problem, because they’re cutting back on Mexican labor and the processors can’t get their labor. That’s big time too.”
Hand graded large crawfish, about 8-10 crawfish to the pound, will fetch a price of anywhere from $1 to $1.75 currently, are beginning to appear in traps. But they’re just beginning to come in, and sometimes ponds simply won’t produce big crawfish. “A lot of times,” says Benoit, “we’re in March, the crawfish won’t grow any more, you’ve got too much crawfish in the pond. Some of them ponds probably need to drain and wait for next year. We tried fishing out the smaller ones and letting the rest grow, but that doesn’t work.” Another facet of the crawfish market is the uncertainty of the Atchafalaya Basin, which comes in later than the ponds. Depending on the amount of water from spring rains in the mid-west, wild crawfish production can boom or bust.
Adding to crawfishermens woes is the lack of federal insurance to help them out during a bad season. “Crawfish is the only commodity in Louisiana that has no insurance, no price support, there’s no engine set up by the federal government,” says Minville. “If sugar takes a bad hit, a faction of USDA will come in and make up the difference in price. So will rice, beans and everything else. In crawfish, we are a true free market, and we are getting persecuted by it.”
Benoit discounts both the notion of collectively scaling back to increase prices and the accusations of price fixing. “There’s no solution. I don’t think a strike’s going to be a solution. The only solution is if you can’t get enough money, you just have to leave that pond alone for a while. Most of us got to fish as long as we’re making money. The crawfish industry hadn’t changed. We’ve been in this for over 30 years. Crawfish starts coming in it gets peeled. The only thing hitting us is the high price of fuel and the labor problem. That’s the only thing changed. The people haven’t changed, they still are going to pay the same amount as they always have for crawfish. Bottom line is we’ll work as long as we’re making money.”
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