Seafood companies in the U.S. Pacific Northwest are “getting sucked into the escalating trade war between the Trump administration and China,” according to a new report in the Seattle Times.
Beginning on 21 September, some 5,700 types of food products from China, including USD 2.7 billion (EUR 2.3 billion) worth of imported Chinese seafood products, will face U.S. tariffs levied at 10 percent, increasing to 25 percent at the beginning of next year.
In July, China imposed its own 10 percent tariffs on a range of U.S. imports as part of an escalating trade war with the United States, including almost all American seafood. The additional tariffs could make American seafood too pricy for some Chinese processors and consumers – a possibility that could fall especially heavily on U.S. seafood companies in the Pacific Northwest and Alaska. In 2017, the value of Alaskan seafood shipped to China was USD 988 million (EUR 840 million), more than a quarter of the value of the state’s total seafood harvest.
Even so, the Times reported that “seafood industry officials, normally a vocal bunch, have been reluctant to publicly criticize the tariffs for fear of antagonizing the Trump administration.”
“The spouting whale gets the harpoon,” one trade group representative told the newspaper.
As a result of the tariffs, American consumers will likely pay more for seafood – even fish and shellfish landed domestically, according to Groundfish Forum Executive Director Chris Woodley. In a 5 September letter to the U.S. Trade Representative, Woodley, whose organization representing the Alaskan flatfish and rockfish industries, outlined how many U.S. seafood products are processed in China due to the significantly cheaper cost for labor there. But those products all fall under the reach of the new tariffs and U.S. companies will have to pass on those costs to conumsers, he said.
As an example, a one-pound bag of wild-caught Alaskan flounder that has been reprocessed in China that currently sells for USD 4.95 (EUR 4.21) in Walmart will cost USD 5.45 (EUR 4.64) under a 10 percent tariff and USD 6.19 (EUR 5.26) as the result of a 25 percent tariff, Woodley said.
Higher prices will make U.S. seafood vulnerable to competition from cheaper seafood, such pangasius from Vietnam, which currently sells in this country for just USD 3.69 (EUR 3.14) a pound, Woodley said. The growing price gap could “drive U.S. consumers away from purchasing fish products which are sustainably harvested from Alaskan waters by U.S. flagged vessels with U.S. crew members,” Woodley wrote.
The tariffs of U.S. seafood going into China may also hurt the efforts of seafood companies from the Pacific Northwest and Alaska attempting to expand into the Chinese market, according to the Times.
Jim Gilmore, director of public affairs for the At-sea Processors Association, said that rival producers of salmon and pollock – primarily, Russia – will take advantage of the trade war to establish themselves as the premier low-cost supplier to China.
“If Russian pollock gains a foothold with Chinese seafood buyers because our products face a 25 percent tariff [that is] not applied to our biggest competitor, we could lose out on a potentially large market that could be a game changer for our marketing prospects internationally,” Gilmore wrote in an email to the Times.
Photo courtesy of Kingsun Foods
