Shockwaves permeated through the Atlantic Canadian seafood industry when the Chinese government announced on March 8 the imposition of a 25 per cent tariff on Canadian seafood effective March 20, adding to the ongoing threat by the U.S. president to do the same on April 2.
“It’s been a long time since we’ve had such headwinds facing agriculture and seafood at the same time,” said Bob Creed, executive director of the P.E.I. Seafood Processors Association.
The Chinese tariffs have been levied on over $2.6 billion worth of Canadian agricultural and food products in retaliation against levies Ottawa introduced in October, 2024 on Chinese-made electric vehicles and steel and aluminium products.
“When you have both the U.S. and China having us in a tariff environment, it does create a significant amount of hinderance for industry and for all fishing. Quite honestly for agriculture as well as other manufacturing sectors,” said Creed.
The U.S. and China are the two biggest markets for Canadian seafood and in particular, lobster.
In 2024, Canada exported a total of $1,902,885,949 worth of live lobster, as well as processed/frozen lobster meat to the U.S. (44,238,985 kg) and $524,968,601 (18,330,437 kg) to China. In 2024, Canada exported $2,940,064,307 (80,395,345 kg) worth of lobster to more than 30 countries.
Going into the height of the lobster fishery in Atlantic Canada, Geoff Irvine, executive director of the Lobster Council of Canada (LCC), said it was too early to tell how the tariffs will impact the Chinese and American markets.
“There is very little lobster left at the moment. Live shippers and processors will be asking for 25 per cent more and we will see how it goes. The tariffs are happening exactly when the spring seasons open in full and there are always price adjustments from the low volume and high prices from the winter, so tariffs will be another factor that goes into where prices end up,” he said.
While market diversification is something the LCC works on constantly, Irvine said not enough market diversification can be accomplished in short order to counteract a decreased demand from the U.S. and China. “It all takes time and we need China and the U.S. to take similar volumes as previous years,” he said.
“The relationships industry have already developed have developed over decades and so yes industry is working hard to grow other markets,” said Creed.
“There’s no mistaking the disruption impact the tariffs in the U.S. and China will make. It’s one thing to have a willing buyer and a willing seller. You have to have the shipping logistics and the infrastructure in place to make sure high-quality product gets to where it needs to be when it needs to be there, that the receiver has the supporting infrastructure to receive it, so in some cases it will take time to develop those shipping routes that make the most economical sense for everybody involved and for the consumer. Not every market has the same palette. Markets are different in how they want to consume their product. That’s where companies have to do their work.”
Creed noted the Canadian seafood industry is recognized around the world for food safety and quality. “That is still with us. If we can find a geopolitical solution to these tariffs. It will take time to support the industry to develop those new markets. I’m confident industry will continue to look at diversification regardless if the tariff in the U.S. is avoided. I think the shockwave to the industry is that we need to look at diversification as a more imminent strategy.”
Creed said while industry is hopeful the U.S. tariff threat will be paused by April 2, “There’s been pauses, there been starts, there’s been pauses. It could be that way for the next number of years and that uncertainty is never good for business.”
In Nova Scotia, the Province has set aside $200 million for a contingency fund to help deal with tariffs and allotted an additional $200,000 in permanent funding to the Department of Fisheries and Aquaculture to support market diversification activities specific to the seafood sector. The Province has also established a tariff response hotline for all businesses, where they can get information support and advice on the tariffs.
“There are many other supports at the federal and provincial levels for companies who wish to explore new markets,” said Kent Smith, Minister of Fisheries and Aquaculture in a statement on March 13.
“Tariffs imposed by China and those proposed by the United States will have an impact on our province’s seafood sector. This is a very complicated and dynamic situation that will continue to evolve in the coming days and months. Our Premier is working closely with his provincial and territorial colleagues, along with the Prime Minister, on a Team Canada approach to addressing the tariffs.”
