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One Man's Opinion: For the fish business, global means growth

Property of SeaFood Business magazine
By Peter Redmayne
July 01, 2007

Having spent a good part of May and June traveling in China and Vietnam, I've had plenty of time to ponder the effects of globalization on the U.S. seafood industry.

Fish, of course, has always been an international business, but never more so than now. Imports currently account for nearly 80 percent of our seafood supply. And that percentage is only going to keep increasing. Catches from U.S. fisheries are stable at best. Meanwhile, high production costs and burdensome regulatory issues make it highly unlikely the American aquaculture industry will curb our seafood trade deficit.

The good news for the seafood industry is that demand for fish will continue to grow. Our population is growing and that means more mouths to put fish in. At the same time, the baby boomers are in their prime seafood-consumption years. The trick is to find more fish to sell.

That's where countries like China and Vietnam come in. In terms of volume, China is far and away our leading seafood supplier, exporting more than a billion pounds to the U.S. market last year. That means that about 25 percent of all the seafood we eat comes from China.

While not nearly as large, at least compared to China, Vietnam is also an important supplier, sending more than 200 million pounds to the United States last year.

Both China and Vietnam would like to send us more seafood to sell, but we're not making it easy for them. As in most cases with trade globalization, there are winners and losers. In the case of U.S. seafood trade, the losers don't go down without a fight, which means filing a dumping action (because the political cards are stacked against them, the exporters usually lose). Our imports of seafood from China, for example, would be a lot higher were it not for high antidumping duties on shrimp, which have been in effect for the past two years.

The Vietnamese have had their fish fights, too. In their case, it's been mainly with the catfish crowd (Vietnam's shrimp duty is less than 10 percent). Since 2003, there's been a stiff 40 to 60 percent anti-dumping duty slapped on Vietnamese pangasius. The Vietnamese have responded by sending more of 
their ballooning production (it's now up to a million metric tons a year) to Europe and Asia. While U.S. imports of pangasius are still growing, they account for less than 15 percent of the country's catfish exports.

The Vietnamese and Chinese could also sell us more fish if they didn't make it so hard on themselves. Instead of listening to those U.S. customers who tell them to soak their fish in tripoly and ship 90 percent net-weight product, they would be much better served to have an effective regulatory system that prevented the export of poor quality and fraudulently packed product.

Globalization is here to stay. In the case of seafood, almost everyone benefits, from importers all the way through the distribution chain to retailers and fish-and-chip operators. The challenge for the exporter and importer is to make globalization as profitable as possible.

 

Contributing Editor Peter Redmayne lives in Seattle

 

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