The federal government unveiled a long-awaited program on Wednesday to provide aid to fishermen and lobstermen hurt by Chinese tariffs instituted in 2018 during a trade war, but industry leaders expressed concern that supply chain businesses do not qualify for aid.
President Donald Trump announced in June that aid for lobstermen would be available through a program previously aimed at farmers. Maine’s congressional delegation has lobbied for funding for the industry for more than a year, citing the massive decline in business for Maine lobstermen as China imposed retaliatory tariffs on American lobster and shifted to buying much of its lobster from Canada.
China instituted a 25 percent tariff on American lobster in July 2018 after Trump put tariffs on various Chinese goods entering the U.S. amid a trade war that began with concerns about alleged Chinese theft of intellectual property and other trade practices.
The tariffs quickly changed the fortunes of an industry that had seen Chinese exports grow steadily over most of the decade, according to state data. In the first six months of 2019, when the tariffs rose to 35 percent, American lobster exports to China dropped to 2.2 million pounds, down from 12 million pounds during the same period in 2018. Maine accounts for about 80 percent of U.S. lobster exports.
Lobster exported to China became eligible for a tariff exemption earlier this year, but lobster exports during the first half of this year were still down from pre-trade war levels. Members of Maine’s congressional delegation urged U.S. Agriculture Secretary Sonny Perdue to act quickly on implementing Trump’s order for aid for lobstermen in August, saying China only bought $25.9 million in U.S. lobster in the first half of 2020 compared to $128.5 million in all of 2017.
On Wednesday, Peter Navarro, Trump’s trade adviser, blamed China for the industry’s struggles, saying fishermen were “targeted” as part of an attempt to go after “economic interests in politically sensitive states.” Soybean farmers and other agricultural growers were also hit hard by the trade war and began receiving federal aid last year to offset that.
The program rolled out Wednesday is through the same agency, but for seafood instead of crops. It offers up to $530 million in payments for fishermen who trade in more than a dozen seafood products, including lobster.
The Maine Lobster Dealers’ Association, however, expressed disappointment at the rollout on Wednesday, noting that the funds were only available for lobster fishermen, not supply chain businesses that lost out due to the decline in exports.
“It is the lobster supply chain businesses who have been forced to eat the cost of the retaliatory tariffs, not the fishing sector, which saw record high ex-vessel prices paid per pound in 2019,” said Annie Tselikis, the association’s executive director, in a Wednesday statement.
The payments to lobstermen are calculated based on their total 2019 lobster haul in pounds, at a rate of 50 cents per pound, according to preliminary federal rules. The maximum payment any individual or entity can receive is $250,000. People can begin applying for aid through the program on Sept. 14.
The rollout of the program follows the president’s announcement last month that the U.S. and the European Union negotiated the elimination of tariffs on lobsters exported from the U.S. to Europe. Maine lobstermen previously faced a disadvantage compared to their Canadian counterparts due to an earlier trade deal between the E.U. and Canada.
It also comes as Trump has put special attention on Maine ahead of the 2020 election. The president, who won a single electoral vote from the 2nd District in 2016, said during a visit to a medical manufacturing facility in Maine in June that he plans to win the whole state this year, though he has trailed former Vice President Joe Biden, the Democratic nominee, in statewide polling so far. The pair are running roughly even in the 2nd District.
“President Trump was taking a tough stand on China,” Navarro said, “and what we did today was have the backs of American fishermen.”