Chicago lobster joints feeling the pinch of price hike

Over the past two decades, lobster has become plentiful and popular. But the combination of increased demand and this year’s slight decline in lobster catch has caused a spike in prices that hasn’t been seen for at least 10 years — and customers are paying for it. (Chris Sweda / Chicago Tribune)

By: Ally Marotti, Contact Reporter
Chicago Tribune

The Happy Lobster Truck has built up quite a following in its 1-1/2 years in business, schlepping to different parts of the city and selling its fare.

But customers lining up at lunchtime to grab a lobster roll are having to dig a little deeper to satisfy their crustacean craving. The wholesale price of new shell 1-1/4-pound lobsters, the type caught off the coast of Maine and Canada, is $5.38 per pound, according to Toms River, N.J.-based commodity market news service Urner Barry.

Lobster is typically the cheapest in August and September, when tourists quit flocking to seafood shacks on the East Coast. But prices didn't drop this year, and remain at or near their 10-year highs, said John Sackton, editor and founder of Lexington, Mass.-based industry publication Seafood News.

Restaurants and food trucks are left with a hard choice: Increase prices for customers, absorb the cost or take the items off the menu. For some lobster-focused restaurants that sprang up a couple of years ago, when lobster was cheap, taking lobster off the menu isn't an option.

Lobster Gram Founder and chairman Dan Zawacki packages live lobsters at the company's warehouse on Chicago's North side on October 25, 2016. (Chris Sweda / Chicago Tribune)

"There was just this explosion in the number of new restaurants or new restaurant chains who started using lobster in different ways," Sackton said.

The Happy Lobster Truck, which opened in June 2015, recently increased the price of its lobster roll $2, to $17. It was a difficult call for a budding business, Robinson said Tuesday, leaning out of the food truck's window as it was parked outside the NBC Tower in downtown Chicago. Customers noticed the price hike and demanded explanations.

Robinson looked for other distributors to try to offset the costs, but in the end went with "quality over price," Robinson said. He has other menu items, like $12 lobster grilled cheese and lobster mac and cheese bits (two for $5), to assuage the budget conscious.

Luke's Lobster, an East Coast lobster shack that opened its only Chicago location in the Loop in 2015, charges $16.50 for a lobster roll, a price that hasn't climbed because it gets its lobster from sister company Cape Seafood, a crab and lobster processing company in Maine.

Da Lobsta charges $14 for a roll at its River North and West Loop restaurants and food truck, a price owner J. Wolf recently nudged up from $12.95 because he felt he had no choice.

"I never expected (the price of lobster) to get that high," he said. "I'm really at a point where I should be charging more, but I'm riding that fine line of keeping my product approachable, so we're taking a hit."

Other lobster-based businesses are feeling the pinch too.

Lobster Gram, in Chicago's Albany Park neighborhood, has shipped lobsters as gifts for 30 years, but stopped offering its lobster rolls for three months this summer.

Lobster Gram Founder and Chairman Dan Zawacki pulls a live lobster out of a tank at the company's warehouse on Chicago's North side on Oct. 25, 2016. (Chris Sweda / Chicago Tribune)

"We use fresh lobster meat for our lobster rolls, and that was so expensive it practically doubled," said founder Dan Zawacki. "That was a big bummer, because … that's when everybody is wanting lobster rolls."

China is partly to blame for lobster's record prices, said Bob Bayer, executive director of the Lobster Institute at the University of Maine.

China used to turn to Australia and New Zealand for its lobster — a typically more expensive, clawless version of the crustacean. But lobster from Canada and the U.S. is cheaper, and the Chinese are developing a taste for it, he said.

The good news for lobster lovers is the price spike likely won't last forever.

"(The prices) will probably settle at some point," Bayer said. In the meantime, "it's great for the fishermen, because catches are good."

amarotti@chicagotribune.com

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