190$, and Boston soon became the major 

 groundfLsh port. The development of quick 

 freezing and filleting in the 1920 's great- 

 ly increased the market for Boston ground- 

 fish. Not until 1935, when the Midwestern 

 market for ocesui perch developed, did 

 Gloucester and Maine vessels enter the 

 groundfish fillet industry. 



Precedent thus established, the Boston 

 large trawler today is exclusively concern- 

 ed wLth haddock, and those of Gloucester 

 and Maine ports vd.th ocean perch. It is 

 not likely that this specialization will 

 be dlminj-shed, since a number of factors 

 tend to sustain it: the proximity of Boston 

 to Georges Bankj the proximity of Maine 

 ports to the Gulf of Maine; market prefer- 

 ences; the large fresh-market for haddock; 

 and the transportation facilities available 

 in Boston, IW 



The development of the large- trawler 

 fleet and the groundfish indiistry of Canada, 

 on the other hand, is a postwar phenomenon 

 based principally on the rising acceptance 

 of frozen groundfish fillets in the Mid- 

 western markets of the United States and 

 the market growth of the pre-cooked fish 

 stick (processed by United States firms 

 from inqjorted fish blocks) in all areas of 

 the United States, The Canadian industry 

 is based on export and a frozen product. 

 The growth and development of the Canadian 

 large- trawler fleet was occasioned by the 

 realization among processors of the need 

 for large supplies of groundfish and their 

 desire for control of both the supply and 

 cost of the raw product, ^^/ 



Other factors also tend to reinforce 

 the diversified groundfishery in the 

 Canadian industry. Chief among these is 



the fact that, far removed from the major 

 markets of Canada and the United States, 

 it must deal in a frozen product. Con- 

 sequently, the Canadian industry is pri- 

 marily concerned with the production of 

 frozen fillets and fish blocks. Particu- 

 larly for the latter product there is 

 little consumer preference for one species 

 over another. In addition, the concentra- 

 tion of ownership in the Canadian industry 

 and the facilities available at major 

 Canadian portis also argue well for diversi- 

 fied fishing. 



3. structural Differences Of Ihe Canadian 

 And New England Industries 



Perhaps the greatest and most impor- 

 tant difference between the fisheries of 

 the two areas lies in thei-T respective 

 structures. 



In general, the New England industry 

 is composed of a large number of small 

 firms solely engaged in either operation 

 of vessels or in processing. Although a 

 few firms are engaged in both functions, 

 they are nonetheless not vertically in- 

 tegrated, 112/ Thus the vessel owner 

 sells to an independent processor; the 

 price, in large measvire, being determined 

 by the forces of supply and demand. 



The industry in the Atlantic ProTr- 

 inces, however, is characterized by a few 

 large vertically-integrated firms which are 

 able to exert a great deal of influence 

 on price. In effect, the processor is 

 "buying" from himself. When he buys the 

 catch of vessels other than his own, he 

 also can exert a downward pressure on the 

 price paid because of his concentrated 

 btiying power, -^-3/ 



110/ See White, Donald J. The New England fishing Industry , Harvard University Press, 

 Cambridge, 19'^h» (Especially Chapter III), 



111/ The nature of the econoiry of the Atlantic Provinces has also been a factor in the 

 development of the Canadian fishing and processing industry. For a detailed discussion 

 of this developrrent, see Chapter II, 



112/ \Jhile vertical integration of vessel owner and processor has been successfully 

 cxiFEailed in the port of Boston by virtue of a federal court decision rendered in 1918, 

 there is evidence that in the Maine ports, particularly in the port of Rockland, where 

 one large firm owns and operates vessels and a freezing and filleting plant, because 

 of buyer concentrations and in the absence of a selling room, (auction system) groundfish 

 operations .are becoming more and more integrated. Even the Gloucester industry may 

 eventually tend toward integrated operations as a result of the waning union strength and 

 the continued decline in the number of both vessels and processing firms, 



113/ Report of the Royal Commission on Price Spreads of Food Products . Vol. I, 

 Queen's Printer and Controller of Stationery, Ottawa, 1959, P» 76. 



76 



