Lobster industry, other fisheries to receive tariff relief in $530M federal bailout

File Photo / Laurie Schreiber Maine's lobster industry could receive $50 million in tariff relief under a bailout package announced Wednesday by the U.S. Department of Agriculture.

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By William Hall

Maine lobster harvesters and other commercial fishermen affected by foreign trade tariffs on their catch will receive a total of $530 million in federal relief, the U.S. Department of Agriculture announced Wednesday. But the aid won’t help the seafood industry’s supply chain businesses, such as lobster dealers and processors.

The state’s lobstermen could receive roughly $50 million in relief under the USDA Seafood Trade Relief Program, based on its compensation rates and the 100.7 million pounds of lobster landed in Maine during 2019.

The program will pay fishermen to help offset reduced sales and additional costs caused by retaliatory tariffs. Licensed fishermen will receive amounts up to $250,000, based on their landings and a range of payment rates for 19 species. The rate for lobster is 50 cents per pound, the second-highest amount after the 76 cents to be paid for each pound of geoduck clam.

“The Seafood Trade Relief Program ensures fishermen and other U.S. producers will not stand alone in facing unjustified retaliatory tariffs while President [Donald] Trump continues working to solidify better and stronger trade deals around the globe,” U.S. Secretary of Agriculture Sonny Perdue said in a statement Wednesday.

Patrice McCarron, executive director of the Maine Lobstermen’s Association, commented: “Maine’s hard-working lobstermen did not create these trade issues, but for too long have had to live with the consequences. Lobstermen have been doing all they can to keep their businesses viable only to be met with weakened markets in 2020 due to the pandemic. Federal relief will help keep Maine’s fishermen solvent so they may continue following their proud traditions in the face of so many challenges.”

Too little too late?

The relief package comes after more than a year of lobbying by Maine’s congressional delegation, industry advocates and others.

In July 2018, China slapped a 25% tariff on imported lobster, among other levies, as part of an ongoing trade dispute with the U.S. Live lobster exports to China dropped by 64% the next month. In 2019, the tax was increased to 35%.

The effects were costly. The lobster industry has an economic impact of $1.5 billion a year in Maine and is a key economic engine for coastal communities. During 2017 — the last full year before the tariffs went into effect — Chinese customers purchased $128.5 million of lobster from Maine, and were the second-largest export market for the catch.

As revenues plummeted for many agricultural producers, the USDA began providing relief through its Agricultural Trade Promotion Program to some of the sectors. Lobstermen, however, were not included.

Last June, after visiting Maine, President Trump ordered the USDA to add the lobster industry to future bailouts.

But the new aid doesn’t go far enough, some said on Wednesday.

“Today’s announcement by USDA is welcome news for Maine harvesters, and we encourage them to apply quickly for this funding,” said U.S. Sens. Susan Collins, R-Maine, and Angus King, I-Maine, and U.S. Rep. Chellie Pingree, D-Maine 1st District, in a joint statement.

“However, this program does not currently include dealers and processors, many of whom have suffered severe economic harm and lost large shares of their foreign markets due to these retaliatory tariffs. Given how critical these entities are to the industry’s supply chain and overall success, any effort to solve this problem must include aid for these businesses.”

The Maine Lobster Dealers’ Association issued a statement saying: “While the intent of STRP is to mitigate the impact of retaliatory tariffs from foreign governments on U.S. producers, it completely neglects to address that in the lobster industry, this pain has been felt by live lobster wholesalers and lobster processors, not by commercial lobster fishermen.

“While we do appreciate recognition of the seafood industry at a time when we are facing many challenges domestically and internationally, we believe that USDA has failed the U.S. lobster industry by not allocating funds to the supply chain.”

To apply for the funding, licensed commercial fishermen can sign up beginning on Monday and until Dec. 14. More information is available here.