China-US trade war temporary "ceasefire", tilapia, squid, pike crab and other aquatic products prices may have to rise
The trade war between the United States and China "ceasefire" 90 days, the industry is expected to some aquatic products prices or will rise.
On Saturday, at the G20 summit in Argentina, the heads of state of China and the United States reached an important consensus in which both sides agreed to suspend the escalation of the trade war and give 90 days for a new round of negotiations.
The U.S. agreed not to add more tariffs on $200 billion of Chinese goods, and the rate will remain at 10% from January 1, 2019. China is willing to expand imports in accordance with the needs of its domestic market and people, including purchasing marketable goods from the United States to gradually ease the trade imbalance. Both sides agreed to open their markets to each other.
At this time, the two sides have not yet announced a list catalog of goods to be purchased.
The trade talks between the two countries had fallen into major disagreements in the past three months. Foreign media disclosed that the main negotiation differences were China's inability to expand its opening at the request of the U.S. side and the difficulty of resolving the technology transfer dispute between the two countries. After the negotiations failed, the two countries began to raise tariffs on each other, leading to an escalation of the trade war.
The seafood import and export trade was deeply affected by the tariff rates. Since July, U.S. exports of squid and lobster to China have decreased sharply; U.S. importers have pressed China for orders to deliver ordered tilapia fillets to the U.S. in advance of January 1 next year. In October this year, raw material prices for tilapia in Guangdong rose to a peak in three years.
Tilapia price trend
In July, China imposed a 25% tariff on some U.S. goods and the big U.S. bean exports were nearly paralyzed, but the White House said it would fund to help bean farmers to tide over the difficulties.
On the other hand, some speculators sent U.S. lobsters to Canada, labeled them as of Canadian origin and exported them to China, causing strong discontent in the Canadian industry. In September, Chinese Customs seized a shipment of U.S. lobster smuggled from Vietnam.
An executive of a major Chinese aquaculture and feed processing company told UCN, "If the U.S. imposes a 25 percent tariff on Chinese tilapia, the consequences will be very serious." Some Chinese tilapia farmers have switched to balsa fish to reduce their risk and supply the domestic market.
To avoid the trade war endangering their own industry, the U.S. authorities have also made some adjustments. In September, fillets and block jelly products of pollock and real cod species were removed from the levy list; in October, the U.S. authorities exempted salmon fillets from import duties again.
In addition, the Alaska Seafood Marketing Institute (ASMI) applied to the USDA for a $9 million grant to cover marketing expenses and trade war losses. USDA approved the purchase of $30 million worth of Alaska pollock for domestic nutrition assistance programs.
However, haddock fillets processed in China for re-export are still subject to a 10% tariff, and demand for haddock from Chinese processors is gradually weakening, leading to a drop in raw material prices.
An industry source expects that the prices of haddock, golden flounder, squid, pike and other species may increase after the U.S.-China trade war ceasefire agreement.