A Chinese desire to avoid economic self-mutilation might protect most Alaska salmon from the crossfire of a rumbling trade war between the Asian nation and President Donald Trump, multiple sources have told craigmedred.news.
Millions of pounds of salmon are shipped from Alaska to China to be processed every summer, and a reported 25 percent Chinese tariff on the fish had the potential to create havoc in Alaska commercial fisheries with salmon seasons just beginning in earnest.
But the Chinese make more off the Alaska fish than they pay for them and apparently don’t want to take a sizable economic loss just to make a point with Trump.
China imported about $1.3 billion worth of seafood from the U.S. last year, but turned around and exported about $2.8 billion worth back to the U.S., according to data from the National Marine Fisheries Service.
How much of the export was made up of salmon headed and gutted in Alaska only to be shipped to China to be fileted and stripped of pin bones before being sold in the U.S. is unclear, but the quantity is thought to be significant.
With the Bristol Bay sockeye fishery and major pink salmon fisheries around the state just getting underway, significant Chinese tariffs on H&G salmon as it is called could have seriously driven up costs for processors and thus pushed down prices paid fishermen.
That was about the last thing needed in an industry already being stalked by fading salmon returns.
“It would have really been tough in the short-term, especially for some species,” Andy Wink, a fisheries consultant, said Wednesday.
But, he like others, said that everything he is hearing says that H&G Alaska salmon will be spared tariffs, which makes sense given the amount of money China makes on processing and reselling.
The Alaska Seafood Marketing Association said its China office is also reporting the Chinese plan to hold off on tariffs on H&G salmon, and said the same thing was being heard from the Chinese trade partners of fish companies processing in Alaska.
Intrafish, a website focused reporting on the commercial fishing business, this afternoon was quoting officials of the National Oceanic and Atmospheric Administration (NOAA) saying that fish imported into China for “reproccessing and re-export” would be exempted.
Wink added, however, that tariffs could make life tough for small, but growing niche markets for high-end Alaska products in China. Upper-class Chinese “love king crab,” he said. “They love black cod,” geoducks and sea cucumbers.
No one can say how a 25 percent tariff on seafood might affect markets for those seafood products, but added costs are unlikely to boost sales.
Seafood tariffs are but one part of a Chinese reaction to Trump’s June 15 decision to impose a 25 percent tariff on $50 billion in aerospace, robotic and auto industry exports from China.
Trumps said the tariffs were in response to Chinese thefts of intellectual property.
The Chinese quickly hit back with similar tariffs on U.S. agriculture exports, seafood among them. Trump has since upped the ante with threats of tariffs on a further $200 billion in Chinese exports to the U.S.
Alaska governor weighs in
Alaska Gov. Bill Walker, an independent running for re-election, is trying to leverage the trade war to further his long-held dream of construction of an Alaska gas line. He Monday signalled he is heading for the nation’s capital to try to mediate a truce.
“Next week, I will meet in Washington with leaders from both governments who have been at the table leading the efforts to avoid an unnecessary trade war,” he said in a statement issued Monday by his office. “I will continue to work directly with both sides to make sure Alaska’s interests are protected.”
He suggested Alaska has plenty to sell to China to help reduce the massive trade balance between the two countries that has irritated Trump.
“Alaska has abundant resources, from natural gas and seafood to beer and baby food,” his statement said. “These resources enable our state to dramatically reduce the trade deficit between the United States and China, if we can finalize agreements to increase exports of our products.”
The U.S. trade deficit with China rose to a record $375.2 billion last year, according to the U.S. Department of Commerce. Craft brewing is a booming business in Alaska, but it’s unlikely to help balance trade with China.
The state’s 35 breweries produce less than 1 million gallons of beer per year, according to the Alaska Department of Labor. Bud Light sells a reported 1.24 billion gallons per year and companion brand Budweiser another 1.23 billion gallons.
If Alaska sold all of its beer and seafood to China, and the Chinese stopped adding value to the latter and shipping it back to earn profits that increase the trade deficit, Alaska products now in production would barely put a dent in the balance of payments between the U.S. and China.
A natural gas pipeline and liquified natural gas (LNG) shipments to China could move the needle, but the Trump administration’s big complaint about China is that it has for decades now been getting the better of the U.S. in business deals.
An Alaska-China deal on gas that benefits Alaska and China at the cost of the U.S. balance of trade – as the current seafood deals do – might not sit well with the Trump administration.
Not to get off subject too far but here’s a thought.
I wonder how many Chinese and other foreign vessels are out in the ocean illegally scooping up all the Salmon. Resulting in low returning numbers.
Just a thought, maybe they think profits would be better if they stop paying to bring them to their country when they can just go get them, on their own.
This is the first vessel caught since 2014. https://www.adn.com/alaska-news/2018/06/22/alaska-based-coast-guard-cutter-detains-chinese-flagged-vessel-for-suspected-illegal-fishing/
I never meet a pin bone or pin head that I did not like. Keep on keeping on Bill.
Like I previously said Fly, lose the logic in your handle!
Is there any reason to not mandate icing,bleeding and tracking point of origin for all seafood, at the point of harvest, when it is destined human food markets?
Curious as to why, in the 21st century, we still allow fish used for human consumption to not have mandatory food processing, handling and safety standards, starting at the point where a fish enters the supply chain – when it is first caught by commercial fishermen.
What are your thoughts on this? Even in Bristol Bay, where a majority of the fish go into chilled conditions, it means that not all fish harvested (data shows more than 25 percent) do not get chilled, let alone bled or tracked.
To improve the quality of the end product, doesn’t it just make sense to mandate food quality standards for seafood? That type of food safety and quality control is already priced into the beef, pork, chicken, and lamb food supply chains – and the average price per pound for these types of proteins are typically half of what seafood costs consumers per pound.
At the same Costco store, I can go by ground chuck hamburger at half the cost of the good “value” $ 10/lb. salmon and be certain the cow didn’t sit for 12 hours before it was bled, chilled and tracked for food safety protections.
It wasn’t that long ago that salmon were all pewed onto barges and covered with burlap and occasionally watered to cool them down-that was of course when salmon all went into the can. It’s been a while but a shark fisherman in San Francisco mentioned the burlap technique was better than ice in his opinion.
There are some fisheries where ice is not available and any mandate would most likely just destroy those fisheries. How about mandating ice for fish wheels?? Heheh!
Processors will require their fishermen to ice their fish (or use chillers) if they sense its need for the marketing of their product. No matter how it’s sliced, much of Alaska’s salmon harvest is a volume show and there are other reasons that some fish don’t require ice. I suspect chum roe is one that doesn’t require ice to produce a good product. And, canning is still done for some of Alaska products.
As far as bleeding of salmon, my own experience was that bleeding didn’t occur on the Copper until the processors started offering 5 cents/lb extra for bled fish-that gradually gave way to some requiring they be bled. That 5 cents/lb probably only covered the loss of blood weight, but we all know now how improved the quality of fish is.
By the way, I suspect that you can never be certain that your chuck was not from a downer cow (whether/not it was chilled).
Around 1995 all PWS processors made it mandatory, that purse seine fishers, have RSW systems installed on their vessels. These Boats are between 42’ to 58’ limit. The salmon are chilled to 33-34 degrees, before delivery to large tender vessels. The drift & set gill net fleets, using smaller vessels, have been using slush ice bags, last five years.
The quality of salmon harvested and sold to PWS processors, is some of the highest quality in our state.
The frozen Alaskan salmon are transported to a Chinese factory, near the North Korean border, where workers are brought over the border, to hand pull pin bones from salmon fillets. 12 hour shifts, $1 wage per day. End of story!
I made a previous comment, that no reprocessed salmon would be included in the Chinese tariffs. Why would they? Too much money is made on our Alaskan resource, by Chinese companies.
James, here is a comment from Lanie Welch’s latest column in AK Journal of Commerce:
“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.”
interesting. just the opposite of what ASMI is saying. i guess we’ll see. doesn’t make much sense to me for the Chinese to impose tariffs on a product they’re making more off from than Alaskans, and the Chinese aren’t stoopid.
Well Craig, this whole tariff situation doesn’t make much sense. Not an economist anywhere supports them (not even Larry Kudlow).
This is just a pissing match between Don Trump and himself IMO.
Caught, often not chilled, headed and gutted, frozen, shipped to China, thawed, filleted, pin bones removed, frozen again, shipped across the ocean again, repackaged for retail markets, thawed again at the store. That must be some tasty and expensive cat food by the time the consumer see’s it! Would you buy this salmon knowing that is the process(and I missed some)? There must be a better way to treat these fish, boycott all filleted salmon that is filleted with the pin bones removed, only buy local fresh headed and gutted fish.
Where you been, fly? There are no seiners fishing with dry boats anymore and all those in PWS have chips in their brine that shows the temperatures the whole time the fish are there. And why would anyone want to boycott all filleted salmon with pin bones removed? Are the chinese the only ones removing pin bones? Whew!
You need to get that “logic” out of your handle IMO!
Really Bill you’re stating that if I surveyed the fleet I would not find one boat or set netter that is NOT chilling their salmon. Please see this: http://www.alaskafishradio.com/chilled-salmon-sets-a-record-at-bristol-bay/
That said it seems that any salmon with that is filleted with the pin bones removed comes from a Chinese source, do you have information that proves otherwise? My point is there must be a better way than involve the Chinese in this. I like Chinese but mostly Mongolian Beef. And leave my handle out of this it is certainly better than Bill (know nothing) Yankee but we should let the masses decide.
Fly, next you’ll tell us that Norwegians have the Chinese remove their pin bones from their farmed atlantics.
For the last several years Costco has been selling previously frozen sockeyes filleted and pin bones removed for about $10/lb, clearly not cat food. There are several machines marketed to remove pin bones that may/may not compete well with Chinese labor @ $1/day. However, price is always an issue and consumers will always be influenced by it. Quality is certainly another issue and it appears that Chinese have a handle on that or their product wouldn’t be received so well IMO.
You think that the way the fish are handled could be done differently-but they are buying and reprocessing large numbers of wild salmon and you are complaining. What exactly is your complaint? Do you want those North Koreans shipped here to do that bone removal? Or is it that the Chinese are somehow involved?
By the way, Alaskan salmon cannot all be marketed fresh. The volume used to be dealt with by cans but fresh-frozen is the main method today.