Despite trade war, US seafood companies still see positives in China

Since the start of the trade war between the United States and China over a year ago, certain sectors of the seafood industry have seen sharp drops of trade between the two countries.

The United States and China have taken turns ramping up tariffs on each other’s products, starting at 10 percent tariff rates and escalating to 25 percent duties on most products, including seafood, traded between the two countries.

Some prominent examples – such as the lobster industry in the U.S. state of Maine – have showcased how the tariffs have created an immense drop in trade between the two countries. Despite those barriers, however, many U.S. companies were still present at the China Fisheries and Seafood Expo in Qingdao, China, this week, working to maintain relationships with Chinese customers and build new ones.

For Christopher Lee, the director of squid specialist Sea Fresh USA, the market and supply chain that has been established in China is too robust to ignore. While the North Kingston, Rhode Island-based firm has had difficulty coping with the 25 percent tariffs on many of the products it buys from China, its well-established supply chain in China makes it hard to consider ceasing business there, Lee said.

“Yes, squid may be cheaper from some other part of the world, but when you call that part of the world and ask for it, they don’t have it,” Lee told SeafoodSource. “Supply side issues trump everything, and keep this business interesting and terrifying.”

China has, over decades, created a well-established supply chain that make the country appealing, even with tariff obstacles, Lee said.

“Don’t expect companies to jump out of China quickly, because China has done a damn good job of creating the infrastructure, and no Southeast Asian country is going to initiate that overnight,” he said. “You’re not going to pull up roots here and start that in another country overnight and be successful.”

No matter the outcome of the trade war, Sea Fresh USA will continue to keep a close eye on the world’s largest market, Lee said.

“We will not be stopping from paying attention to China,” Lee said.

For Seattle, Washington, U.S.A.-based Trident Seafoods, one of the largest seafood companies in the United States, the Chinese market as too important to ignore. Trident has worked in the market for more than 20 years, exporting to and importing from the market. The tariffs have created difficulties, but not enough to stop the company’s efforts – or progress.

“Of course, growth is affected by the tariffs, and what’s surprising is we’re still seeing growth in all three sectors that we work in,” Jeffrey Welbourn, the senior director of Trident’s China Business Office, told SeafoodSource. “Which makes you wonder how fast we could be growing if there weren’t barriers.”

The tariffs have only slowed the company’s growth down, not stopped it, Welbourn said. The market, as well, is too important to ignore.

“Why would we ignore any market, really?” he said. Trident has offices in the U.S., Europe, Japan, China, and Latin America, and Wellbourn said the different markets complement each other.

“We don’t want to ignore anyone, we want to use the five markets to support each other,” he said.

Part of that support involves using different markets to find the best place for certain products – for example, some pieces of fish are suited for different markets, depending on usage and need.

“What’s unfortunate is some of the pieces of our fish that should be going here, we are instead choosing to push into other markets, when – tariffs aside – the best value for that market could have been here,” Welbourn said.

The trade war has created a number of new hurdles for Trident that have caused the company headaches, but not ever close to the point where the company ever considered abandoning its Chinese business, Wellbourn said.

“It’s a heck of a lot more work to do the same stuff in this climate, but it’s still growing,” he said. “If we’re looking at what this market could be, it’s one of the most important, growing markets in the world, and we’ll be here long after the tariffs are gone.”

Photo courtesy of Chris Chase/SeafoodSource


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