ROCKPORT — Maine lobster dealers are among a group of U.S. seafood exporters asking federal authorities to keep its industry out of the brewing U.S-China trade war, arguing that putting a tariff on Chinese seafood would likely result in painful retaliation against U.S. exports.
Such retaliation would hurt Alaskan fishermen and Maine lobstermen most, industry leaders say.
“Not only because China is a crucial current and future market for U.S. fish, but also because there is no ready substitute for the China market,” said John Connelly, president of the National Fisheries Institute, in testimony to the U.S. trade representative.
Connelly was one of a half-dozen seafood industry leaders to oppose a recent proposal from six shrimp-producing states to levy a tariff on Chinese shrimp imports. They claimed it was unfair to drag seafood into a trade battle that began over intellectual property rights.
Most importantly, they worry about the impact of retaliatory seafood tariffs, especially for lobster.
In 2017, U.S. lobster exports to China were worth more than $90.2 million and rising, Annie Tselikis, executive director of the Maine Lobster Dealers Association, said in written testimony. That’s 125 times bigger than it was just a decade earlier, she said.
In 2017, China imported 17.8 million pounds of U.S. lobster, an amount that has gone up about 20 percent every year since 2010. China’s middle class, which is 300 million strong, see lobster as a celebratory food that represents their rising fortunes and wealth.
In 2017, China’s appetite for U.S. lobster helped offset declines in European imports, which fell off in part because of a trade deal between Canada and European Union countries that put the Maine lobster at a tariff differential with Canadian lobster.
The growth of the Chinese market has supported the creation of thousands of new industry jobs in Maine, Tselikis said. She estimates the industry employs a total of 14,000 people in Maine, in direct fishing jobs as well as support and distribution roles.
The industry, which averages $500 million a year in direct boat sales and another $1 billion from the larger supply chain, has spent hundreds of thousands of dollars developing the Asia market, especially China, to offset tariff disadvantages suffered in other markets, Tselikis said.
“(We) are beginning to run out of options as to where we may market and promote our products around the world,” Tselikis said in May 11 testimony. “We cannot suffer a blow to the Chinese lobster market, too.”
Other U.S. seafood exporters agreed, saying fishermen from Russia, Canada, Iceland, Thailand, Norway, Vietnam and Chile, among others, are just waiting to “elbow out” American competitors from the Chinese market if seafood tariffs are levied.
“Market access, particularly in a country like China, takes years to secure,” Chad See of Freezer Longline, which represents hook-and-line fishing vessels that fish in federal waters near Alaska, wrote in his testimony. “Once it is lost, it takes many more years to get back, meaning that trade actions today will have long-lasting effects on the U.S. seafood industry.”
Tselikis and other Maine exporters who gathered Friday in Rockport for a panel discussion about trade with Asia as part of the Maine International Trade Center’s International Trade Day, say they are hopeful that U.S.-China trade talks will resolve some of the tensions.
Already, the trade war seems to be evolving into something more akin to negotiations, they say.
Treasury Secretary Steven Mnuchin said Sunday that the Trump administration is putting its trade war with China “on hold” after two days of talks in Washington that produced agreement on increased Chinese purchases of American products and measures to make it easier for U.S. companies to operate in China, The Washington Post reported.
Adam Kennedy, who has more than doubled Portland-based Kepware Technologies’ international sales during his six years there, said he is watching the news carefully, but echoed the comments of MITC’s Wade Merritt when he said that he’s more watchful than worried.
Brian McNamara, the president of Southworth International Group of Falmouth, a manufacturer of industrial ergonomic handling equipment, said he feels like proposed steel tariffs have put a bull’s-eye on his company, driving prices abroad and at home up 25 to 50 percent.
It’s so bad that he may have to buy steel from Sweden, where Southworth has a subsidiary.
But the panelists agreed that if Maine companies have the right product, the capacity for growth, and the persistence, including a willingness to hire translators and invest in building diplomatic and corporate relationships, Asia and even China are still a good market bet.
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