Seafood industry hurt by high loonie

Seafood processors, who arealready coping with sour market conditions, are bracing for a season of poor profits with predictions calling for a rising Canadian dollar.

The strength of the loonie has already made conditions in the export-dependent seafood industry miserable, with many processors struggling to stay afloat.

"There is no margin here to run our business anymore," said Derek Butler, who runs the St. John's-based Association of Seafood Processors, who pointed to new predictions that the Canadian dollar will reach parity with the U.S. dollar this summer.

"There's no expectation this is going to change. All of the five major banks now say that [the dollar reaching] par or worse is the future long-term trend, [so] we have to deal with the long-term structure of the business."

Wade Boyd, who fishes for crab from St. John's, said harvesting will be brutal this year.

"We wish the dollar was worth 50 cents," Boyd told CBC News.

"It would be way better for us.It's good for importing, but it's no good for exporting."

On Thursday, the Newfoundland and Labrador government reported that the value of its seafood industry in 2009 had slumped by 22 per cent from the year before, to about $827 million.

"It's really interesting to note that half that reduction has to do with the exchange rate," provincial Fisheries Minister Clyde Jackman said in an interview.

"So it just tells you, you know, our Canadian dollar the strength of our Canadian dollar is certainly impacting negatively on that."

Statistics released by the federal Department of Fisheries and Oceans shows that the country's seafood exports for 2009 were almost $3.64 billion, down from $3.88 billion in the year before.