Fish Factor: China’s new tariff on seafood raises concerns

25 percent tariff is in response to Trump’s trade war

Shockwaves rocked the Alaska seafood industry when China announced on June 15 that it will add an additional 25 percent tariff on seafood imports starting July 6 in retaliation to President Donald Trump’s trade war.

“The 25 percent will be added to the current base tariffs which typically range from 5 to 15 percent,” said Garrett Evridge, a fishery analyst with the McDowell Group.

The list of seafood products includes all Alaska salmon, pollock, cod, herring, flatfish, Dungeness crab, snow crab, Atka mackerel, sablefish, geoduck clams and more.

“This is devastating news,” said Frances Leach, executive director of United Fishermen of Alaska which represents 34 groups. “The tariff will not just impact commercial fishermen but will also affect the more than 60,000 individuals who are employed by the state’s fishing industry.”

China has been Alaska’s top seafood customer since 2011, purchasing 54 percent of all seafood exports valued at $1.3 billion in 2017.

The bulk of Alaska’s fish harvests go to China for reprocessing before they are sent to customers around the world. Those also will be subject to the 25 percent tariff, said market expert John Sackton of SeafoodNew.com.

“China has become the de facto export destination for virtually all seafood reprocessing done overseas. The cost of these tariffs will slam the seafood industry, because ultimately there is little choice but to continue to send these products to China,” he said. “So, through no fault of our own, most companies will see a big hit to their bottom line because they will have to agree to lower prices in order to maintain marketability in the face of this 25 percent increase in costs.”

“This represents the worst outcome feared by the industry,” Sackton added. “The Chinese are deliberately targeting smaller industries that have little ability to fight back.”

Candidates mostly pan Pebble

Five candidates for Alaska governor met up at the Bristol Bay Fish Expo in Naknek on June 9. The debate focused on a wide range of topics affecting rural Alaska, including two hot fish issues.

Naknek is the hub of the world’s largest sockeye salmon run at Bristol Bay, which also is at the heart of the proposed plans for the Pebble Mine.

Gov. Bill Walker said emphatically that he is not in favor of the Pebble Mine.

“I had an interesting discussion with a group that said it can be done safely. My response was what if it doesn’t. Look at all that is at risk. I am very pro-development and pro-mining but not in that location,” Walker said.

Mead Treadwell, a Republican candidate from Anchorage, said he will not trade one resource for another.

As a former deputy commissioner of the Alaska Department of Environmental Protection, Treadwell said he helped write state water quality standards.

“If this mine cannot meet the kind of water quality and habitat protection standards that we have created to protect our fisheries, then it won’t happen,” he stated.

“From what I’ve seen it is going to be very hard for Pebble to make it through the process … But it makes sense to have a strong public process where we get to analyze what is happening,” Treadwell added.

Republican candidate Scott Hawkins of Anchorage said the mine has the legal right to go through the permitting process, but that it “very well may be the wrong mine in the wrong place because if anything goes wrong, there is just so much at stake.”

“I think the mine is losing momentum,” Hawkins added. “All the big investors have decided that it just doesn’t work on several levels. A lot of it is just how controversial it is to the people in this region and that is hurting the mining industry.”

Mark Begich, a Democrat from Anchorage, has long touted the “wrong mine/wrong place” meme, which was first stated years ago by former Sen. Ted Stevens.

“When people say they are against it, they should be against it all the way,” Begich said. “The first thing I would do as governor would be to immediately make sure the Corps of Engineers knows that state land or state right of way or state access would not be part of their plans or participate in any way. I believe that would finally put an end to this project and end the divisiveness it has caused throughout all of Alaska. This issue is like Groundhog Day, it never goes away and just keeps coming back.”

Mike Dunleavy, a Republican candidate from Wasilla, was more equivocal saying it was difficult for him to answer until Pebble goes through the study process.

“Once we can examine that data, then I think a final decision can be made,” Dunleavy said, adding that if the mine is going to endanger fisheries or other resources in the area, “I think we all should be against it.”

“I do think there is a danger in politicizing this study process that we have,” he added. “In the end, if it is not a good project we shouldn’t have it permitted.”

No backers for salmon ballot 

The Stand for Salmon initiative that aims to update habitat protections for the first time since statehood could go before voters in November. But the measure has little support from the gubernatorial candidates.

“While I don’t support it, I certainly understand that local input is critical in the process,” said Gov. Walker.

“I believe the reason we have Stand for Salmon is because the Coastal Zone Management Program died in the 2011 legislative session and that took away local input into the development process,” Walker added. “I think this is what happens when you take away input by the people – you meet them at a ballot initiative or you meet them in the court room and I think that is unfortunate.”

Mead Treadwell also said he does not support the salmon initiative.

“This bill essentially assumes that every stream is anadromous when it’s not. This would take away your property rights without protecting the fish,” Treadwell said. “Do I stand for salmon and believe we need to protect salmon? Absolutely. I don’t think this is the right law to do it.”

Scott Hawkins said the “devil is in the details” and he believes the ballot initiative would have a lot of unintended consequences and “shut down a lot of things in this state.”

“It’s not that our permitting process couldn’t do with some tightening up,” Hawkins added. “We need to have a process that knows how to say no. Just because you apply for a permit should not mean that at the end of the day you are going to get it. We need a very stringent permitting system that holds projects to very high standards, but I don’t think the initiative is the way we get there.”

Mike Dunleavy echoed those sentiments.

I believe there are a number of projects throughout the state that could be at risk. This is a resource state and we need to develop our resources,” Dunleavy said. “We need to do it responsibly and I think the projects should be reviewed separately and held to a permitting and processing standard. I just don’t think an initiative such as Stand for Salmon is good for Alaska.”

Mark Begich said he will take a position when a state court rules on the constitutionality of the salmon ballot initiative.

“At that point I will make a decision. But I will say that the laws should be revamped and reviewed and that has not been done,” Begich said.

“This is a clear symbol of what’s broken in Juneau,” he added. “When you have almost 50,000 Alaskans bring forward an initiative, you have to respect their views and figure out how to fix this problem and make sure our salmon preserved for generations to come.”