New 'Cold War' possible as trade conflicts raise geopolitical stakes
China is awash in Canadian lobsters as exports from the East Coast soar to fill the gap left by Beijing's retaliatory tariffs against the U.S.
China, a huge and growing customer for lobster, placed heavy tariffs on U.S. lobsters -- and many other food products -- in July 2018 amid rising trade hostilities between the Chinese and the Trump administration.
Meanwhile, business is booming in Canada, where cargo planes are coming to Halifax and Moncton, N.B., to handle a growing bump in exports. Canadian fishermen catch the same species of lobster as American lobstermen, who are based mostly in Maine.
The loss of business has brought layoffs to some Maine businesses, such as The Lobster Co., of Arundel, where owner Stephanie Nadeau has laid off half the 14 people she once had working in wholesale.
"They picked winners, and they picked losers, and they picked me a loser," Nadeau said. "There is no market that's going to replace China."
In Canada, exports to China through June were already approaching 33 million pounds, which is nearly as much as all of 2018.
The value of Canada's exports was nearing USUS$200 million through June and was almost sure to outstrip last year's total of more than USUS$223 million. America's exports through June were valued at less than USUS$19 million, more than USUS$70 million behind where they were through June 2018.
America has exported less than 2.2 million pounds (1 million kilograms) of lobster to China this year through June, according to data from the U.S. federal government. The country exported nearly 12 million pounds during that same period last year. That's a more than 80 per cent drop.
In Canada, the boost to business has helped the industry but also led to uncertainty about its future, said Geoff Irvine, executive director of the Lobster Council of Canada.
The American and Canadian lobster industries overlap, with some businesses operating on both sides of the border, and it's more beneficial to the lobster industry at large for trade to go on unimpeded, he said.
"Whenever there's any kind of uncertainty, it makes people worry," Irvine said. "Everybody would like to see the entire lobster industry open and free."
Lobster prices paid by American consumers have remained fairly steady during the trade dispute, and there remain many buyers for U.S. lobster. But the loss of China as an overseas market is happening at the end of a decade in which the U.S. seafood industry has experienced exponential growth in lobster exports to the country. The U.S. exported about 800,000 pounds of lobster in China in 2010 and more than 20 times that last year.
The American lobster industry is looking to open up new domestic and international markets to make up for the loss of China, said Marianne LaCroix, who directs the Maine Lobster Marketing Collaborative. Maine lobsterman Brian Rapp will attend a trade show in Hong Kong and a trade mission to Dubai in September to promote U.S. lobster, she said.
"China is so large that you have to look at a number of new markets to replace that business," LaCroix said.