HALIFAX -- A federal panel decision that recommends scrapping a northern shrimp policy that protects the pioneers of the multi-million dollar industry is dividing fisheries ministers in two Atlantic provinces.

Under the current Last-In, First-Out policy, the last entrants to a fishery off Newfoundland and Labrador are the first to leave when a quota is cut.

But the report released this week from an independent panel reviewing the policy said it does not allow the industry to adjust to changes in shrimp stocks, which have been in decline.

The report recommends replacing the policy with an allocation regime that would include proportional shares in fishing areas.

Nova Scotia Fisheries Minister Keith Colwell said he's disappointed with the recommendation and is drafting a letter for federal Fisheries Minister Dominic LeBlanc to reiterate his views. LeBlanc will ultimately make the final decision.

Colwell said Nova Scotia fishermen have invested heavily in the northern shrimp fishery, which has been around since the 1970s, based on the protections of the Last-In, First-Out policy.

"The Nova Scotia industry has made a huge investment and indeed had developed the industry way back when it all started," said Colwell in an interview on Thursday. "These vessels they have are extremely big investments."

Colwell said moving to the new proposed policy could spell disaster for the Nova Scotia fleet of boats.

"They may have to be tied up part of the year and... they have to have a certain volume of shrimp to catch to make it worthwhile," said Colwell, who has said the industry is worth $131 million to the province.

But Newfoundland and Labrador Fisheries Minister Steve Crocker said the current policy is unfair.

"This policy should likely have never been there in the first place. It applies nowhere else in the Canadian fishing industry," said Crocker on Thursday. "A permanent sharing arrangement is how we share our fisheries."

Crocker noted that no matter what happens, fishermen in both provinces will be impacted, saying "there are no real winners in this."

"We have a declining resource. We have the biomass down by upwards of 40 per cent this year. There is a lot of pain," said Crocker.

"Everybody is invested in this industry. With the recommended sharing approach, it's more of a balance that's spread across the entire industry."

Fisheries spokeswoman Vanessa Colman-Sadd said the value of Newfoundland and Labrador's inshore shrimp industry is projected to be $217 million this year, while the value of the offshore fishery is projected to be $202 million.