Maine officials, lobster industry fret over Canada-EU trade deal

Maine Governor Paul LePage has called for a challenge to the Comprehensive Economic and Trade Agreement (CETA) trade deal between the European Union and Canada, which he said will create a competitive trade disadvantage for lobster and other seafood exported from the United States.

LePage said in an interview with a radio station in Bangor, Maine that he plans to go to Washington D.C. to “instill in them how serious this is,” according to an article in the Portland Press Herald. He said he plans to use his connections with President Donald Trump, whom LePage endorsed during his campaign, to push for a U.S. response to the trade deal.

LePage made his comments after visiting with Maine lobster exporters at the 2017 Seafood Expo North America in Boston, Massachusetts on Monday, 20 March. At the expo, LePage spoke with Annie Tselikis, the marketing manager for lobster distributor Maine Coast, who told him the deal would deal a blow to Maine’s economy.

“The governor walked around and spoke with a number of different dealers from Maine. He heard from a lot of businesses of what this has potential to do for their market and their individual businesses,” Tselikis said. “The governor is very passionate about helping us out, which is great, because he has strong relationships with [the Trump] administration.”

Tselikis said the governor has planned a follow-up meeting with Maine seafood exporters to develop a specific strategy to deal with CETA.

“We’re thrilled to have the support of the governor, his staff and the administration within the state of Maine,” she said.

CETA has already been approved by both Canada and the European Union and will go into effect by 1 July. At that date, live lobsters exported from Canada to Europe will immediately have all tariffs removed, while live lobster exporters from the United States will still face an eight percent tariff. The E.U. will remove its tariffs on frozen lobsters – currently between six and 16 percent, depending on how the product is classified – in three years, while the E.U.’s 20 percent tariff on value-added lobster products will disappear for Canadian exporters in five years’ time, according to Jeffrey Bennett, a senior trade specialist with the Maine International Trade Center.

“It’s definitely going to put [Maine] at a competitive disadvantage,” Bennett told SeafoodSource. “We compete in the same market with the same species, and Europe is a big market for both of us. The fact that Canadian companies will have tariff reductions we won’t have, coupled with their lower currency at the moment, is bound to have an impact.”

Maine exported around USD 152 million (EUR 139 million) worth of lobster to the E.U. in 2016, Bennett estimated – a significant portion of the total value of Maine’s lobster catch, estimated at USD 533 million (EUR 489 million).

“A lot been written about exports from Maine to China and other countries in the Far East, and China recently surpassed Europe as the top foreign market for Maine lobster, but Europe is still one of the biggest markets for us,” Bennett said. “It’s got 500 million people, a high level of seafood consumption, and we’ve had really good relationships with Europe going back a long time. It would be a mistake to discount the importance of maintaining the European marketplace for Maine seafood and lobster.”

Tselikis said CETA “is done” and “is happening,” so Maine must react to it, rather than try to eliminate it.

“There’s no ability for us to get involved in Canadian trade policy with the E.U.,” she said. “We’re hoping the U.S. trade representative will be able to help us with some equivalent measures with U.S. export of lobsters to Europe.”

While that process is in the works, international exporters, including Maine Coast, will continue to focus their sales pitches on the logistical advantages the lobster industry in the United States still enjoys over Canada, Tselikis said. U.S. dealers can ship lobsters quickly out of Boston, New York, Philadelphia and Newark, while Canadian dealers have to drive the lobsters further to Montreal or Toronto, she said.

U.S. lobsters dealers are also urging lobstermen in the New England to take political action make their congressional representatives aware of the issue.

“Fishermen aren’t really aware of how this this is going to impact them,” Teslikis said. “But this is a big deal to us as an entire industry. Wholesalers, fishermen, wharves, freighters, airlines – we’re all going to be affected by and it’s not something we should take lightly. Everybody should be writing their governors, congressional delegations in order to secure their support.”