Activist says something's 'fishy' with Canadian seal skin market Special

Saint John's - The International Fund for Animal Welfare is wondering why the prices for seal pelts have nearly doubled for some sealers when the market has been suffering from a lack of demand.

This article was corrected on April 28. This year's seal hunt is expected to end in early May due to a combination of a warm spring and a lack of market for seal skins. Although less sealers have gone out this year, and the catch tallies less than 75,000 seals thus far, the lack of ice has turned out to be a boon for sealers, making hunting easier. Frank Pinhorn, spokesperson for the Canadian Sealers Association, told The Telegram

“This is perfect conditions for sealing because the ice is not packed together. Whatever ice is there is just filled with seals.”

The nearly doubled price being paid for seal skins has prompted the International Fund for Animal Welfare (IFAW) to ask what is going on. IFAW's senior researcher, Sheryl Fink said in a press release

"Something smells fishy here. Why is it that Quebec sealers are throwing pelts back into the water while Newfoundland sealers now have a buyer for 72,000 skins? It seems strange if NuTan is able to purchase sealskins at almost double last year's price when other Newfoundland processors are unable to get rid of their stockpiled pelts. It also seems remarkable that the demand for seal pelts would skyrocket in less than a week.

... It doesn't make sense. Both the inequality of market opportunities for sealers from different provinces, and the supposed rise in demand for sealskins in Newfoundland are unusual. Processors paid too much for skins in 2006 and as a result still have stockpiles today. It is possible that they are making the same mistake again this year, but it is perhaps more likely that funds are coming from other sources."

Fink was referring to an under-reported incident whereby seal pelts were allegedly thrown away by sealers on board the Jean-Matthieu boat, the only boat to go sealing from the Magdalen Islands this year. The sealers said they couldn't sell the skins. Predictions for 2010 seal skin prices were not optimistic. It was thought prices would continue to be low, due to a constricted market and a surplus of inventory. Last week, the Department of Fisheries and Oceans (DFO) reported going prices were $15.00 per pelt. But of a sudden, out of nowhere, the prices being offered to Newfoundland sealers has increased. Ask those in the sealing industry for an explanation, and they will say the market has improved, an answer that raises questions due to the fact it does not jive with previously noted market conditions. Because of those poor market conditions, only about 40 boats went out sealing in Newfoundland this year. Reached by telephone Tuesday, Frank Pinhorn noted the current catch is well below the quote set by DFO. He said two companies were purchasing seal skins, but refused to name them. He said "... last year, the number one beater [an older Harp seal] was $14 and this year it's $23.50, so the price is almost double what it was last year." Pinhorn attributed the sealing industry decline to the recession.

"The fishing industry in Newfoundland and Labrador is not immune to none of these things. I said the market was slow but I didn't say it was done completely. There's still some activity, there's still people buying furs and the industry is still alive and well. It's not where we want it to be but its way better to a certain degree. The price this year is much better than it was last year, and two of five companies are buying. We never said the industry was dead. And all our sealers this year had to have pre-approval before they could go sailing. What happened to the people in Quebec was they didn't have pre-approval."

Pre-approval means securing

"... a market for your product before you leave the wharf ... Before you go sailing you have an agreement in principle from the companies that when you come in ... they will buy your products. The Newfoundland people who went sealing this year all had pre-approval..."

Pinhorn is very optimistic about next year's sealing saying

"The industry is showing some signs of recovery, the prices are better this year and the industry will be closer to normal within a year."

Reached by telephone Tuesday, Fink mused over the possible reasons for the sudden higher prices being offered to Newfoundland sealers. One favoured theory she has heard was that one east coast fish processor, one of the largest in the Canadian industry, is trying to lure in crab fishers by sweetening the pot, taking their seal skins and offering a premium price for the product. She said one company buying seal pelts this year is Nutan, a subsidiary of Atlantic Marine Products, which is owned by Barry Group Inc., which is one of the major crab and fish processing companies. She explains some suggestions circulating around, "So it looks like what they're doing is they're buying seal pelts from the boats that sell their crabs to them regularly ... and I don't know if this is tied in there with some kind of incentive or some kind of way to get them to ... fish crab at the lower prices when other crab fishermen are refusing to do so by kind of sweetening the deal by paying for seal skins as well this year." Fink also thought it was possible a subsidy from either the federal or provincial governments had been provided to Nutan to stimulate purchasing.

" ... I know Nutan has received numerous federal and provincial subsidies in the past because the other major seal processing company Carino, is based out of Norway so [perhaps] there was preference given to the local company. I don't know if that's what's going on here. The whole thing just seems very weird and I would think someone would start asking questions about it."

Correction: Nutan's media relations person was in Europe, but another person from the company, who asked not to be named or quoted responded to IFAW's allegations via email on Tuesday, but clarified the comments Wednesday. The representative said that the information regarding the number of pelts Nutan would purchase was erroneous. The representative did not know the source of the error. The representative clarified the situation by email Wednesday, saying Nutan would not purchase raw materials if it did not think it could sell the finished product. On Tuesday the representative said Nutan did not say it would purchase less than 15,000 skins, adding that number was from 2009. The representative also blamed the recent slump in the sealing industry on the global recession. The source also said Fink was implying Nutan was being funded by the government, that activist organizations would never consider that improving markets would be the reason for increasing the purchases of raw products and the increase in prices for pelts. The source noted that the prices it offered last year for a Grade A pelt were $15.00, plus $2.50 for the blubber, pointing out the increase in prices for 2010 were only 25% more than last year’s prices. Nutan only deals with seal products, the source said. The Nutan representative was referring to reports that circulated just a few weeks ago stating Nutan had committed to purchase only 15,000 pelts in 2010. Information about Barry Group Inc., Atlantic Marine Products Inc., and Nutan Furs Inc. is not publicly posted by the companies. Atlantic Marine Products Inc. does not have a website. The Barry Group earned the ire of conservationists by offering to purchase 200 grey seal skins last year, thus ensuring the limited hunt would take place. On Wednesday, the Nutan source said The Barry Group did not own either Atlantic Marine Products or Nutan. Nutan purchased Atlantic Marine Products in 2007. The source said it was thought that the Barry Group did not want to be associated with the seal hunt in any way, selling Nutan to another un-named company at some unknown time in the past. Newfoundland's crab fishery is in peril this year. A House of Commons Committee will be conducting an inquiry into the mess, which surfaced in early April; while fishermen are demanding an investigation of the DFO for mismanagement of the crab fishery. The DFO cut quotas for crabs by a very large amount, while prices to be paid to crabbers are low.