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June 18, 2018

China threatens tariff on Maine lobsters as trade war expands

Photo / James McCarthy
Photo / James McCarthy
A lobsterman works aboard his boat in Isle au Haut's harbor. China says it will impose new duties starting on July 6 on imported U.S. products, including lobsters, in response to President Trump's announcement on Friday of a 25% tariff on up to $50 billion worth of Chinese goods.

In response to President Trump's announcement on Friday of a 25% tariff on up to $50 billion worth of Chinese goods, China is threatening to impose new duties on a host of imported U.S. products, including lobsters, starting on July 6.

China's plan to impose a tariff on lobster, along with hundreds of other tariffs, is viewed as potentially jeopardizing one of the Maine lobster industry's biggest markets.

"This isn't good news at all," Matt Jacobson, executive director of the Maine Lobster Marketing Collaborative, told the Associated Press in a report published by the Bangor Daily News.

"Anything that affects the supply chain is obviously not a great thing," Kristan Porter, president of the Maine Lobstermen's Association, told the Associated Press.

China is an emerging market for U.S. lobster, which has gained popularity with that country's growing middle class.

According to the Maine Lobstermen's Community Alliance June 2018 newsletter Landings, "Possible Chinese tariffs would hurt Alaska and Maine the most due to the volume of seafood trade from those states. '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 during his May testimony to the U.S. trade representative."

The trade war comes at a time when China lobster consumption continues to grow. China imported more than 17.8 million pounds of lobster from the U.S. in 2017, eclipsing the previous record of about 14 million pounds in 2016.

The Financial Post reported the value of the imports also surged, from $108.3 million in 2016 to $142.4 million last year, according to data from the National Oceanic and Atmospheric Administration.

It also comes at a time when a new trade agreement between Canada and the European Union, which has cut tariffs on imports of Canadian lobsters, is giving Canada's lobster industry the edge over Maine's. The agreement went into effect last September, phasing out an 8% European tariff on live lobster and frozen and processed Canadian lobster.

Maine's congressional delegation — Republican Sen. Susan Collins, Independent Sen. Angus King; Democratic Rep. Chellie Pingree and Republican Rep. Bruce Poliquin — issued a joint statement that they intend to press their concerns about China's threatened retaliatory tariffs with federal trade officials.

"Maine's lobster industry is an irreplaceable piece of our state's economy that supports thousands of jobs and entire coastal communities," the delegation said in a statement. "Just two weeks ago, the Maine delegation heard directly from our state's lobster industry about the economic hardship a trade war with China would cause them."

China and the U.S. are major seafood trading partners beyond just lobster, and the new tariffs would apply to dozens of products that China imports from the U.S., including salmon, tuna and crab, according Fish Information & Services.

"This is the biggest market in the world, and to have the U.S. at a disadvantage to every competitor is a big deal," Jim Gilmore, public affairs director for the Seattle-based At-Sea Processors Association, which represents six companies that catch and process pollock off Alaska, told the seafood industry trade publication.

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