Lobster Industry Clawed by Tariffs

BOSTON – Vince Mortillaro, the owner of Mortillaro Lobster in Gloucester, told legislators that Chinese tariffs on United States lobsters will take his $40 million dollar company down to less than $30 million by the end of this year. [Anissa Gardizy]

By Anissa Gardizy 

Lobster sales for the first half of the year are down by $6 million dollars for Vince Mortillaro, the owner of Mortillaro Lobster in Gloucester.

He’s not alone.

In Massachusetts, lobster sales took a 62 percent dive over the past year, according to state export officials. Chinese tariffs on United States lobsters—now at 35 percent—have led to an 80 percent decline in lobster exports to China.

In a Joint Committee on Export Development last month, Mortillaro told legislators that Chinese tariffs on United States lobsters will take his $40 million dollar company down to less than $30 million by the end of this year.

“It’s not our fault, we are working harder trying to keep stable,” Mortillaro said. “We need a little help.”

Mark Sullivan, executive director of the state Office of International Trade and Investment, explained that the tariffs began affecting the lobster industry after the U.S proposed its first round of tariffs around mid-year in 2018.

“China returned and proposed its tariffs on U.S. goods including lobsters,” he said. “This was the beginning of the retaliatory trade conflict between the world’s two largest economies.”

Sullivan said the Canada lobster industry is benefiting from the decline in U.S. lobster sales to China.

“Cargo planes are coming into Halifax, Nova Scotia, and New Brunswick to handle this bump in growth,” he said.

Rep. Ann Margaret Ferrante, D-Gloucester, said that could make reestablishing a lobster market in China almost impossible.

“If this continues, the Canadians will have taken advantages and high-jacked all the work that we have done,” she said. “Those inroads and relationships will have been made, and we will never ever get those trading patterns and relationships back.”

Several legislators and members of the public suggested offering aid to lobstermen during the trade war. Ferrante added that soybean farmers, processors, and distributors all receive federal assistance.

“It is hard for me to look [my constituents] in the eye and say that they are being treated as fairly as everyone else in this situation because they are not, there is no assistance for them,” she said.

Ferrante said the lobster industry recently benefited from warm waters that pushed an excess of lobsters into Massachusetts, so the state began to export internationally, establishing inroads into China.

“The first thing folks in this industry did was say, ‘let’s not lean back and just take what we have and sell it domestically, but let’s invest in an exporting market because we have the excess supply to do that,’” Ferrante said.

She said the promising lobster industry attracted some of her constituents who previously participated in fishing but decided that wasn’t a viable occupation.

Rep. Sarah Peake, D-Fourth Barnstable, agreed.

“The lobster fishery [was] one that you [could] get into and put food on the table, pay a mortgage, and send your kids to school,” she said. “To see a well regulated and vibrant industry really just get this kick in the teeth as a result of tariffs is particularly discouraging.”

The Chinese tariffs were unexpected in the industry, Ferrante said.

“As soon as it looked like there was a little bit of sun on the horizon for these hardworking people, who take on back-breaking work to do something so simple as feed our people, the United States government decides it wants to put tariffs on other countries,” she said. “[And] the country with the largest exporting market decided to strike back.”

Sullivan told legislators that opting to sell lobsters to another country would not necessarily placate the state’s dependence on China.

“With a decline in 62 percent, that is very difficult to make up,” he said. “There is no one market that will compete with China.”