by the many vessel classes which have not 

 been able to make satisfactory investment 

 returns. The past few years have been ex- 

 ploratory ones "to determine the lost effi- 

 cient and profitable types and sizes of 

 vessels suitable for the conditions found 

 in the various fishing areas along the At- 

 lantic Seaboard 



isning 



," w^ 



The Director of the Economics Service 

 of the Federal Department of Fisheries be- 

 lieves "that the objectives of the modern- 

 ization program are being realized at least 

 in part" . He notes that the rise in con- 

 struction costs in recent years has led to 

 pressure for higher subsidies, and states 

 that there appears to be a positive corre- 

 lation between vessel size and operating 

 returns. Of importance, too, is his con- 

 clusion that earnings of most fishermen on 

 the vessels in the program now compare 

 favorably with those of workers in industry 

 in the same region. Wi/ 



There is evidence that on a per week 

 worked basis, fishermen earnings on the 

 subsidized vessels compare well with those 

 of workers in other industries in the At- 

 lantic Provinces. This comparison does 

 not, however, taJce into account the sea- 

 sonality of their fishing efforts . If 

 earnings are prorated over the entire year 

 instead of only the fishing seasons, a less 

 favorable picture develops, (table II-lU) . 

 The severity of the winters, the icing up 

 of many poriis and the danger to small craft 

 in the North Atlantic in winter, restrict 

 the fishing period. Boat days-at-sea range 

 from as low as S\\ for the 50-60 foot New- 

 foundland long-liners to 181+ for Nova 

 Scotian draggers. 



It would be misleading to make direct 

 comparisons of the operating results of the 

 subsidized vessels with those of craft in 

 the New England fleet. The vessels are 

 too dissijiilar in types and sizes. The 

 costs per pound of the groundfish landed 

 by the subsidized vessels are relevant only 

 to New England operations because of the 

 ultimate competition in the consumer mar- 

 kets. 



Many of these subsidized boats sell 

 to processing plants which operate their 

 own trawlers, also. The price at which 

 they sell is the same €is that, at which the 

 processors buy from their own boats. It 

 is economical for the processors to buy 

 much of their requirements from the inde- 

 pendent operators. The overhead costs of 

 additional trawlers are thereby saved. 



To the extent, therefore, that the 

 government subsidy is used to cover costs 

 that the processor would otherwise have to 

 incur, and to the extent that this subsidy 

 permits the independent fishermen to accept 

 a price lower than would otherwise be 

 possible without it, the Canadian fish 

 processor has a distinct and very real 

 competitive cost advantage over his New 

 England rival. 



The Canadian trawler owner is always a 

 processor. Hence, it is to his advantage 

 to acquire his fish at the lowest price 

 possible. The more he pays the more is his 

 labor cost, as his crew gets 37 percent of 

 his gross revenues. If subsidy keeps 

 prices lower than would otherwise be the 

 case, he has leverage which enables him, 

 also, to pay a lower price for the fish 

 caught by his own vessels. Again, this is 

 a competitive cost saving vis-a-vis his 

 New England counterpart . 



The development of the subsidized 

 fleet has probably not resulted in a net 

 increase in the size of the combined 

 Canadian Atlantic Coast fleets. The new 

 vessels have replaced a larger naiiber of 

 small outmoded craft. The weakening of 

 salt cod markets and the development of 

 the frozen fish trade has resalted in 

 lower cod landings and higher catches of 

 haddock, ocean perch, and flounder. In 

 the process, long-liners and draggers re- 

 placed the dory schooner and dories of 

 history. hS/ Looking to the future, most 

 industry and government observers do not 

 believe that the offshore fleet will 

 change radically from its present propor- 

 tionate mix of trawlers, draggers, and 

 long-liners . It is expected that there 



W Ibid., p. 76. 

 ini/ MacKenzie, op. cit., p. 20. 



IT^/ Proskie, Operations of Modem Longliners and Draggers, 1952-1957 , 

 op. cit., p. 12. 



22 



