Chinese Fishing Town Feels U.S. Tariffs Impact

In Maoming, a southern Chinese city featuring a massive tilapia statue overseeing an intersection, the fish symbolises more than an affordable meal; it represents a career, a source of income, and a lifestyle for many. Currently, everything is threatened by the trade conflict. A region approximately one and a half times larger than San Francisco is dedicated to tilapia farming in Maoming. Fish nurseries and feedlots, in turn, support the farms. Sixteen factories are scattered throughout the city, converting tilapia into fillets for export, with a large portion going to supermarket freezers in the U.S. Multiple rounds of U.S. tariffs imply that China's $425 million in tilapia exports to America face duties of 170 per cent effectively pricing them out of their main export market.

In late April, fish nurseries in Maoming, as reported by Reuters, indicated that they weren't receiving orders for new fry; feed manufacturers mentioned that clients were reducing their purchases. Processors are inactive, and numerous farmers report experiencing losses at current prices. This month, Tongwei, a leading aquaculture company in China, announced that one out of every ten tilapia farmers in the nation may face job losses. "These elevated tariffs have impacted us severely," stated Huang Songfei, a veteran buyer in Maoming. "The entire chain is suffering." Individuals face the threat of job loss. Although tilapia represents a minor portion of commerce between the U.S. and China, the impact on livelihoods in Maoming is being experienced in both nations as the trade war imposes significant tariffs on imports. Or, as Huang expressed it: "We're trapped."

Trade War Impact on Maoming

The peak stocking season for tilapia typically occurs from March to May. Recently hatched fish are usually in great demand, quickly sold and dispatched to farmers. This spring, there are a few orders. "This is the toughest year thus far," a worker stated, requesting anonymity. "Typically, we would have sold quite a bit by this time." Yet nobody is purchasing. "Farmers are fearful." Her supervisor stated that sales have dropped by over fifty per cent. "Some aren't exporting to the U.S. at all, yet they are still in a state of panic," he stated, asking to remain unnamed. "It's a domino effect." Tilapia prices fell by 17 per cent in early April as Washington and Beijing exchanged tariff strikes. Huang stated that although there has been a slight recovery, prices remain perilously low, causing difficulties for some farmers in making a living. The 16 export processors in the city are facing difficulties as well. According to the local government, they previously exported approximately 100,000 tonnes of tilapia annually, primarily to the United States and Canada, which was sufficient to meet the average yearly fish consumption of 25 million Americans.

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"If this continues, everyone will end up bankrupt," stated Zhu Huazhi, a purchaser for various processing plants. Over 60 per cent of their tilapia used to be exported to the U.S. In the nearby province of Hainan, the U.S. represents 50 per cent of tilapia exports, and this month, the local aquatic products association encouraged companies to seek new markets domestically and internationally. Nonetheless, substituting American demand proves to be challenging. Although markets are present in the European Union, Africa, and the Middle East, they cannot swiftly or fully substitute U.S. demand. Africa, as an example, mainly brings in whole fish with little processing, as stated by a tilapia exporter. The national economy is not an easy problem to solve, either. The local market is weak, buyers are careful, and expenditures are sluggish. In Maoming, residents are placing their expectations on a trade agreement.  "We'll find out who can endure this," Zhu stated. "I have faith in China's economy." Should the tariffs be settled, orders will return." 

($1=7.2995 Chinese yuan renminbi)