Restaurants feel pinch of high lobster prices

The popular shellfish is fetching 30% more per pound than it did last year, prompting some eateries to drop it.

By Jonathan Berr Mar 28, 2013 7:02AM

Lobster on a plate (© Alexandra Grablewski/Lifesize/Getty Images)Updated at 12:54 p.m.

Lobsters prices are 30% higher than they were last year -- so expensive, in fact, that many restaurants are dropping the tasty dish from their menus, according to trade publication Nation's Restaurant News.

Late winter storms interfered with catches over the past few weeks, constraining supplies. Canadian lobsters are fetching between $9.50 and $10.50 per pound in Massachusetts, the center of the industry, versus $6.50 to $7.25 per pound a year ago, the website says.

"I’ve never seen it this high," Bill Adler, the executive director of the Massachusetts Lobsterman's Association, told NRN.

The pinch is even being felt thousands of miles away in California, where demand from China is crimping supplies. "We had to cut it; we just couldn’t justify serving it once it got so expensive," said Carson Wise, a manager at California's Las Olas restaurant, in an interview with local paper The Coast News.

Ironically, Darden Restaurants' (DRI) Red Lobster chain isn't affected by the price increases. Because the company negotiates prices in advance, temporary market fluctuations don't affect it, said spokeswoman Heidi Schauer in an email to MSN. That’s an advantage most smaller rivals don’t have.

Still, Red Lobster has plenty of other problems. Sales in the third quarter fell 6% to $669 million even as it spent heavily on advertisements.

The lobster shortage comes a year after a record glut pushed prices so low that many lobstermen decided it wasn't worth putting their boats in the water.

Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter at @jdberr.

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Mar 28, 2013 9:43AM
Wasn't it just 6 months ago we heard lobster men complaining that prices were so low it didn't make sense to bother laying out the traps.   Lets hope they are at least getting some of the higher prices and it is not all at the  wholesaler level.
Mar 28, 2013 12:48PM
If you can run fast there`s always some at the entranceway of RED LOBSTER.
Mar 28, 2013 2:48PM
I was in line at the market the other day and the lady in front of me had six packages of lobster tails in addition to some fat ribeyes. I thought to myself...I wish I had a little extra cash to go all out on dinner...treat my family. Seconds later she pulled out her wad of foodstamps, smiled, and was on her way.
Mar 28, 2013 2:52PM
Now that's a brutal industry. Last summer the lobster industry could give lobsters away with the prices down about $1.50 a pound, a 30 year low. 

Now at an all time high in a year?  

Feast or famine on
Mar 28, 2013 2:18PM
well this is how you make up for the "glutt" just a few months ago.....
Mar 28, 2013 11:24AM
We have two 1.5 pounders left, in the freezer from Maine. Wonder what they would bring on Ebay?
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