On Friday, the Southern Shrimp Alliance filed comments with the United States Trade Representative (USTR) expressing support for President Trump’s proposal to increase tariffs on certain Chinese imports, including Chinese shrimp imports, from 25 to 30 percent. The Administration has proposed a modification of Section 301 (19 U.S.C. § 2411) tariffs in response to actions taken by the Chinese government to maintain unfair acts, policies, and practices previously identified by the U.S. government as harming the American economy.
Imports of farmed seafood products from China, including shrimp, along with a wide assortment of other products, have been subject to an additional tariff imposed by the USTR since September 24, 2018. Initially set at 10 percent, Section 301 tariffs on these products were increased to 25 percent effective on May 10, 2019. The USTR had initially announced that Section 301 tariffs on these products would increase to 25 percent on January 1, 2019, but the increase was delayed after the Chinese government agreed to hold negotiations. The Administration’s request for comments on the potential increase in tariffs to 30 percent indicates that proposed modification would take effect on October 1, 2019.
In its comments to the USTR, the Southern Shrimp Alliance explained that the imposition of Section 301 tariffs has led to a significant decline in the amount of farmed seafood imported from China. Over the first seven months of this year, the United States imported roughly $150 million less in aquaculture seafood products from China ($324 million) compared to the same time period last year ($475 million). Over $100 million of that decline is attributable to a steep drop in shrimp imports, which fell from $168 million in the first seven months of 2018 to $65 million over the same period this year.
As imports of Chinese farmed seafood have declined, so has the number of entry lines of Chinese seafood refused at the border by the U.S. Food and Drug Administration (FDA). As the chart below shows, through August of this year, the FDA has reported refusing 86 entry lines of Chinese seafood compared to 231 entry lines over the same time period last year:
The Southern Shrimp Alliance’s comments explained that the FDA’s reporting supports the belief that U.S. importers source questionable seafood products from China because of its availability at low prices. The imposition of significant tariffs on Chinese seafood imports appears to substantially reduce the appeal of such a business strategy and, in turn, reduces the pressure on FDA to inspect and stop dangerous goods at the border in order to prevent them from reaching American consumers.
In prior comments to the USTR in support of Section 301 tariffs, the Southern Shrimp Alliance explained that China is one of the few countries in the world to not make meaningful progress in addressing the abuse of antibiotics in aquaculture production and that seafood from China, on its own, accounted for fully 42 percent (1,310 out of 3,114) of the total amount of seafood entry lines refused by the FDA for veterinary drug residues over a sixteen-year time period running from 2002 through 2017.
In addition to the Southern Shrimp Alliance, comments in support of expanded and increased Section 301 tariffs were submitted by Archer Daniels Midlands Company (seeking to include Chinese lysine imports as subject to Section 301 tariffs) and the California Cling Peach Board and California Canning Peach Association (supporting increase in Section 301 tariffs on Chinese imports of canned peaches, canned fruit mixtures, and frozen peaches to 30 percent).
Read the Southern Shrimp Alliance’s comments in support of the Administration’s proposed increase in Section 301 tariffs from 25 to 30 percent here: https://shrimpalliance.com/wp-content/uploads/2019/09/SSA-September-20-Comments-on-Section-301.pdf