This Forbes article covers a specific instance of how the “trade war” with China has negatively affected domestic producers in the United States. Alaskan pollock was the top species landed by volume in the United States fishing industry in 2017, and has grown drastically in popularity as a cheaper substitute to cod since the 1980’s. The US fishing industry, and the international market for pollack, however, are threatened by the imposition of tariffs by both the US and China. In the last year, China put in place a 25% tariff on seafood products, and the US responded with a 10% in their tariff on seafood imported from China. This affects the market for Alaskan pollock so drastically, because to cut costs, pollock have historically been processed in China, and then shipped back to the US for distribution. This practice has allowed the US to maintain a low cost of production per unit and maintain a comparative or absolute advantage in seafood production over their international competitors.
With the new tariffs in place, back and forth shipping to and from China, in an effort to increase productivity will become less effective. To stem the damage of the trade war on US fishing, the US announced that Alaskan pollack imported back from China will be exempted from the US tariff. However, this still gives other nations that ship their fish to China for processing an advantage over the US, which has to observe China’s tariff. The trade war will continue to reap negative effects for domestic producers until sustainable compromise is met, the fishing industry is just one of many examples of sectors economically disadvantaged by the trade war.