Lobster exports decline sharply as tariffs kick in

ELLSWORTH — Some say trade wars are easy to win, but every war has its casualties. According to trade figures just published by NOAA Fisheries, the lobster industry may be one of them.

In June, the United States exported to China nearly 1.6 million pounds of live lobster worth $11.7 million.

In July, live lobster exports to China totaled about 539,000 pounds valued at about $4.1 million.

What caused the precipitous decline?

One factor is that on July 6, China began to levy an additional 25 percent tariff on $32 billion worth of U.S. exports, including, among other goods, lobsters, live or processed. That move was aimed at countering the impact of a 25 percent U.S. tariff on billions of dollars worth of imports from China.

Exports to China rebounded somewhat in August, but the bounce was like something produced by a soft football, especially compared with the 2017 numbers.

In August of 2017, shippers exported about 1.64 million pounds of live lobster to China valued at more than $13.2 million.

This past August, exports of live lobster to China totaled just about 862,000 pounds — a drop of about 354,146 pounds — with a value of $6.8 million.

Part of that difference may be attributable to an extremely active sales push during the first week of July in an effort to beat the new tariffs.

Maine dealers and lobster shippers are feeling the impact, according to The Portland Press Herald and Undercurrent, an online seafood business newsletter.

The newsletter recently quoted a Midcoast Maine lobster dealer with extensive connections to the Chinese market saying that after a tremendous spurt of buying activity in early July, it “had its tap almost completely shut off” by its Chinese buyers and had laid off 25 percent of its wholesale workforce.

A Boston-based freight forwarder told Undercurrent that his company, which has helped ship some 24 million pounds of lobster per year to China, has had all of its related contracts with commercial airlines cancelled.

But one foreign market for live U.S lobsters has expanded considerably: Canada.

Last year, the United States exported about 4.5 million pounds of live lobster to our friends up north in July. Another 15.9 million pounds crossed the border in August.

This summer’s exports to Canada almost doubled.

In July, about 10.7 million pounds traveled to Canada. In August, the number was 16.2 million pounds.

The loss of the Chinese market has one apparent bright spot for the U.S. industry. With plenty of lobsters to sell and Chinese buyers looking to Canada, NOAA trade figures show that U.S. dealers have been able to compete with Canadian dealers in the fast-growing European market.

There also have been reports of that a “gray market” of the sort once reserved for high-end cameras and exotic electronics is now developing for goods of a different kind — U.S.-caught lobsters that are shipped to Canada then exported to China disguised as products of Canada rather than the United States.

The demand for lobster remains strong in China, where it is a favorite dish for banquets and festivities.

Stephen Rappaport

Stephen Rappaport

Waterfront Editor at The Ellsworth American
Stephen Rappaport has lived in Maine for nearly 30 years. A lifelong sailor, he spends as much time as possible messing about in boats. [email protected]

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