The new reciprocal 34% tariffs announced by the United States and China could especially impact Alaska seafood prices, due to the state’s heavy reliance on exports and Chinese labor.
The tariffs have been a moving target. On March 4, President Donald Trump imposed an additional 10% tariff on Chinese imports, which brought the cumulative tariff’s to 20% on top of existing tariffs from Trump’s first term, which were basically left in place by President Joe Biden.
Then there is the new 34% tariff on top of that. China immediately reciprocated by imposing a 34% tariff.
The tariffs will affect Alaska seafood sent over and processed in China and re-exported to the US, a common practice for Alaska products like pollock and salmon. Over half of Alaska’s fish is sent to China, where pin bones are removed by cheap labor, then is re-imported as packaged for retail to the US.
While Alaska salmon is headed and gutted on this side of the Pacific Ocean, to process fillets and remove pin bones is very labor intensive, so companies like Trident Seafoods and others use the massive processing centers in cities like Qingdao, Dalian, and Yantai in Shandong and Liaoning provinces, which are global seafood processing centers.
China uses forced labor, including conditions that Americans would view as slave labor, in Qingdao and other parts of Shandong Province to process fish. Qingdao has a reputation for using and abusing minorities, particularly Uyghurs and North Koreans, in its seafood processing plants.
The “dual tariffs” now in place as Alaska moves into fishing season will increase cost of processing, which will be passed along to consumers and could soften the demand for wild Alaska salmon.
Meanwhile, farmed salmon from Scotland, Norway, and Chile, are also processed in these same facilities. Those farmed salmon products have very low tariffs — in the teens — between the respective countries. Alaska wild salmon is already significantly more expensive than the farmed salmon that is ubiquitous in the Lower 48.
With China as Alaska’s largest seafood export market, there could be a surplus of seafood in the US market in the coming salmon harvesting season, potentially depressing wholesale prices paid to Alaska fishermen and processors, at least in the short term.
One of the outcomes might be that processors in Alaska turn to domestic processing, which has higher labor costs associated with it than the near forced-labor in China.
As for Chinese consumers, they may turn to competitors like Russia or Norway, as happened in 2018 during a trade war, when Russian pollock imports to the US surged as a result of Chinese tariffs on the US, which led to a 20% drop in seafood sales to China, impacting 65% of Alaska seafood businesses.
Now, if American consumers shift to domestic seafood to avoid tariffed imports (mainly Chinese tilapia, prawns, or shrimp), demand for Alaskan products could rise, which might offset some price drops.
Alaska’s seafood industry employs nearly 70,000 people and generates over $5 billion annually. It’s big business, although less than 10% of Alaska’s GDP.
The US-China reciprocal tariffs will be a dynamic condition that may reduce demand and increase costs in the short-term, and may boost domestic jobs that require the use of more workers coming to the US on the H-2B visa, a non-immigrant visa that allows US employers to bring foreign workers in seasonally for temporary seafood processing jobs when there are not enough US workers available. These H-2B visa workers are especially critical for Bristol Bay salmon runs.
As labor markets and supply chains adjust, Alaska fishing companies and US consumers will likely feel the pinch — at least in the short-term.
