Red Lobster will soon take oysters off its menu, after its supplier was forced to shut down due to oil spill in the Gulf.
Darden Restaurants' Rich Jeffers told CNBC Tuesday that Red Lobster's supplier,Ameripure Processing Company, in Franklin, Louisiana, shut down late last week, because it was no longer receiving oyster harvests.
The shortage of supply is driven in part by the expanding ban on fishing in the Gulf of Mexico federal waters. The federal ban area this week reached nearly 87,000 square miles, or more than 36 percent of the Gulf of Mexico.
While the ban has impacted majority of oyster harvesting areas, some beds remain open but virtually ignored because of the economics of the oil spill.
"Oystermen are earning more helping with the clean up," says Jeffers. As a result, some of Ameripure's suppliers appear to be pursuing more lucrative spill clean up work rather than harvesting oysters in the beds that remain open.
Jeffers said Red Lobster will likely run out of its oyster supply by mid-July and the chain will take it off the menu, until its supplier is able to resume shipments, hopefully in October or November.
Darden's Capital Grille is the restaurant group's only other chain which serves oysters, but it is not impacted by the Gulf oil spill, says Jeffers. Capital Grille sources its oysters from the Atlantic and Pacific.
Darden is scheduled to report its fourth-quarter earningsWednesday, after the market close.
Ameripure isn't the first oyster supplier to stop shucking oysters. Earlier this month, the nation's oldest oyster business, P&J Oyster Company, also halted its shelling operations.