Though container prices between Asia and the U.S. are down slightly from the highs importers saw in May and June, continued economic uncertainty is likely to drive price increases among some seafood species, Supreme Crab CEO Troy Turkin told SeafoodSource.
“It’s a new world,” Turkin said, describing fast-moving policy evolutions he’s seeing that are affecting his business, which specializes in luxury imports like blue and red swimming crabs and frozen tuna, among other products.
“Working in imports right now with Asia is good if you had a set of long dark hair to begin with,” Turkin said. “I keep seeing mine getting grayer and grayer from this ordeal.”
Turkin is in the process of anticipating how a recent policy change – U.S. President Donald Trump’s announcement of 25 percent and higher tariffs on a number of Asian nations – would affect his business.
“We have three containers [en route right now] that we had assumed a 10 percent [tariff on]. Now, we have to go and assume it’s going to be [higher] since they’re landing after 1 August,” he said. "You can do the math. We’re going to be reaching Covid-level prices in the not too distant future."
Increased tariffs would drive up prices, likely affecting consumer purchasing decisions, but Turkin said he did not intend to change his suppliers from Indonesia – one of the countries targeted in Trump’s recent announcement.
“[The] reality is Indonesia [supplies] half of the amount of species [of crab meat]. Indonesia is not going anywhere,” he said.
Signaling how fast changes can occur in the current economic landscape, Trump already changed his tune on 15 July, saying that he had struck up a deal to lower the Indonesian rates to 19 percent despite having previously said that the 1 August tariffs were not going to change.
“Great deal, for everybody, just made with Indonesia. I dealt directly with [sic] their highly respected President. DETAILS TO FOLLOW!!!” Trump said on a Truth Social post.
It’s not just seafood facing price spikes, either.
The U.S. Bureau of Labor Statistics' Consumer Price Index for June, released on 15 July, showed inflation steadily ticking upward in the U.S., especially in core categories.
That index rose 2.7 percent year over year in June, which was up from the 2.4 percent year-over-year increase seen at the end of May.
Meanwhile, importers are continuing to rush goods into the country, with Port of Los Angeles Executive Director Gene Seroka attributing the rush to the continued policy uncertainty.
The Port of Los Angeles had its busiest June in its 117-year history this year, with shipments up 8 percent year over year.
“Some importers are bringing in year-end holiday cargo now ahead of potential higher tariffs later in the year. July may be our peak season month as retailers and manufacturers bring orders in earlier than usual and then brace for trade uncertainty,” Seroka said in a 14 July briefing.
Shippers may also be capitalizing on a reduction in container spot rates since May and June, when rates were high because fewer container ships were on the water. Now, according to shipping data firm Xeneta, capacity has increased, and rates have gone down to ports on the U.S. West Coast, though they have remained relatively stable to the U.S. East Coast.
Like Seroka, Xeneta Chief Analyst Peter Sand attributed this unusual situation to widespread economic uncertainty.
"Geopolitics has upset the natural order of ocean container shipping on Transpacific trades in Q2, and shippers are still struggling to make sense of the situation,” Sand said. “Shippers need to act decisively to protect supply chains, but this becomes more difficult when they see abnormal trends.”
For his part, Turkin said he was “trying to power through” the chaotic new industry normal.
“I would just remind everybody to remain patient and resilient and realize we’ve gone through these times before, and the markets come back,” he said.
