With lobster season starting in about a month, something has to be done with last year's frozen catch. (CBC)

With a glut of frozen lobster in Atlantic Canadian warehouses, federal and provincial money is being put toward a new marketing strategy to move it.

The federal Department of Agriculture and provincial governments in the Maritimes are putting up $500,000 to develop a marketing plan. Different tactics are being considered — including branding, new exports and product development — but there is agreement that the first step will be changing people's perception of lobster as a luxury product.

A deep dive in lobster sales is being blamed on the recession. Luxuries tend to be the first to go when people tighten their food budgets, but falling prices in the wake of flagging demand mean lobster is not the splurge it once was.

West Nova MP Gregg Kerr points out lobster has recently been about the same price as bologna, although it has risen in the last couple of months.

"I think most would recognize that the food value in a live fish product is probably quite substantially more than a processed product such as bologna would be," said the Nova Scotia MP.

During the fishing season off the Nova Scotia coast at the end of the year, prices on the wharf fell to $3.50 per pound ($7.70 per kilogram). Sale prices for live lobster in grocery stores over the holidays dropped as low as about $13 per kilogram.

With very few fishermen on the water, wharf prices have rebounded to $8 per pound in Nova Scotia, but Kerr worries they will nosedive again when the larger spring fisheries start. Lobster fishermen have complained that even the $4.50 per pound they were receiving last spring was a disaster in the making for the industry.

In January, processors had frozen lobster worth at least $30 million in their freezers, mostly in P.E.I. If it can't be moved, prices will likely fall drastically as new lobster is landed. The spring fishery is just a month away.

Looking for new ideas

In addition to marketing lobster as an everyday kind of food, the new campaign might promote health benefits of seafood products like lobster. They are also looking into the feasibility of a new processing technique that provides shelled, uncooked lobster, direct to consumers.

Kerr said using celebrity chefs to showcase Atlantic Canadian lobster could raise its profile.

"People like the chef shows," said Kerr.

"They like new ideas, how the product can be used, in terms of what kind of dishes you can use it in."

The marketers will also consider how they can more successfully brand Atlantic Canadian lobster to distinguish it from the competition in Maine.

Early signs worrying

People who depend on the seasonal employment of an Ocean Choice seafood processing plant in eastern P.E.I. are concerned for their jobs.

The employees of the Beach Point plant told CBC News Wednesday they usually would already know by this time of year when the plant would be opening to process crab and lobster, and how much work they would be getting.

Ocean Choice said it is still working to figure out what kind of demand there'll be for seafood before making any decisions. The company said it will be holding a meeting with the seasonal workers next week to discuss the future of the plant.

If the plant does not open some of the workers would be hired at the company's other eastern P.E.I. plant in Souris.