John Henderschedt Archives

Reprocessed state seafood exports exempted from Chinese tariffs

July 12, 2018 — It appears the blowback from President Donald Trump’s trade dispute with China will fall on some, but not all of Alaska’s seafood exports to the country.

The Trump administration’s 25 percent tariff on an estimated $34 billion of goods imported to the U.S. that took effect July 6 prompted Chinese leaders to respond with their own 25 percent tariff on U.S. goods headed for their country, including seafood, Alaska’s primary export.

National Oceanic and Atmospheric Administration Fisheries Director of International Affairs John Henderschedt said June 28 that seafood products destined to be reprocessed and re-exported from China will be exempt from the tariffs after agency officials discussed the issue with the U.S. Embassy there.

While a positive development for Alaska fishermen and processors, the cumulative impact the tariffs could have on the commercial fishing industry in the state is still unknown, Alaska Seafood Marketing Institute Technical Program Director Michael Kohan said in an interview.

Overall, Alaska exported more than $4.9 billion of goods in 2017, of which more than $2.4 billion was seafood, according to the state Office of International Trade.

China bought $1.3 billion worth of Alaska’s exports last year, including $796 million — nearly a third — of the state’s total seafood exports.

Read the full story at the Alaska Journal of Commerce

NOAA Says Seafood for Reprocessing Exempt from Chinese Tariffs, but Rebate System May Impose Costs

June 28, 2018 — SEAFOOD NEWS — NOAA has confirmed via email to people in the Alaska seafood industry that the 25% Chinese retaliatory tariff will not apply to re-processed products for export.

John Henderschedt, NMFS director of the Office of International Affairs and Seafood Inspection, wrote “In consultation with Embassy Beijing, NOAA Fisheries has confirmed that the following products are not subject to the additional 25% tariff recently announced by the Chinese government:

-Imports of U.S. seafood that is processed in China for re-export and some fishmeal products.”

“Affected U.S. seafood exports arriving at Chinese ports on July 6 or later will be subject to the new tariff rate,” he said in an email dated Tuesday, June 26th.

There was some uncertainty following China’s June 15 announcement at the beginning of a long holiday weekend for the Dragon Boat Festival that prevented clarification until government offices re-opened last Tuesday, June 19th, according to Jim Gilmore, Director of Public Affairs for the At-Sea Processors Association.

“Really, no one knew at that time, so the news coverage was of an issue with a lot of confusion and not much time for the U.S. government to get clarification. The holiday didn’t help matters, but it might also have been that the Chinese government language wasn’t clear. Not sure what factors were all at play,” Gilmore said.

One unresolved issue is that China has two types of import exemptions for re-processing for export. One involves no tariff, for products that are exempt, and the other collects the tariff, but then rebates the value back to the company when the product is exported.

One sentence in the Chinese announcement suggests that the 25% tariff will be applied to everything, but then rebated for products that are exported. When asked about this, Henderschedt had no comment.

If this is the final interpretation, the tariffs will add significant costs for exporters, even though they will ultimately get the 25% tariff refunded. For example, a Chinese plant that purchases 1000 tons of cod for re-processing and pays $3.6 million, would have to pay an additional $900,000 to bring the product into the country, but then get this money back when the product was exported. This adds costs to the process, even if the tariffs are ultimately not applied.

Ultimately, the answer will come after July 6^th, when importers of record have to deal with Chinese customs officers.

Jim Gilmore says not much of offshore Alaska’s pollock is re-processed. His group, the At-Sea Processors Association, represents the Bering Sea pollock factory trawlers. He said that’s more common with salmon and cod.

But shore plants, especially in the Gulf of Alaska, export a lot of H&G pollock for reprocessing. In fact, Trident recently spent millions of dollars in the last several years to upgrade its plant in Kodiak to efficiently produce a frozen H&G product.

Also the Bering Sea Amendment 80 factory trawler flatfish fleet’s catch goes to China for reprocessing, especially yellowfin sole, according to Chris Woodley, executive director of the group’s trade association, the Groundfish Forum.

The vast majority of the U.S. exports of frozen seafood to China are reprocessed in China and then re-exported, Woodley said. Such U.S. exports to China that are then re-exported from China are not subject to Chinese duties or the Value Added Tax (VAT). However, U.S. seafood exports that are imported for consumption in China face high tariff rates. For example, frozen flatfish species, and other Alaska seafood exports to China that are consumed in China currently face a duty of 10 percent and are also subject to a 13 percent VAT.

The Dragon Boat Festival is held annually in honor of poet Qu Yuan, who drowned himself in a river in 278 BC, as a political protest. Villagers tried to save the beloved figure in their little boats, but when they couldn’t find him, they threw rice in the water in the hopes that the fish would eat the rice, and not the poet and activist, during the Warring States period of Chinese history.

This story originally appeared on SeafoodNews.com, a subscription site. It is reprinted with permission.

U.S. Leads in Global Fisheries Management

November 13, 2017 — The United States has some of the best managed marine fisheries in the world. With that leadership comes the opportunity and responsibility to advance sustainable conservation and management practices on the high seas and, as appropriate, to support other nations in achieving similar outcomes in their economic zones. NOAA Fisheries, through the work of our Office of International Affairs and Seafood Inspection—along with our national program offices, regional offices, fisheries science centers, and international partners—leads the nation’s efforts in achieving globally sustainable resources and conservation of living marine resources while ensuring U.S. fishermen’s access to high-seas fisheries.

Much of this is achieved through bilateral engagement, participation in regional fishery management organizations, other multilateral conservation fora, and scientific exchanges. But we also use our role as a major importer of seafood by enforcing laws requiring seafood exported to the United States to originate from fisheries that have comparable conservation measures in place. Over the past year, the Office of International Affairs and Seafood Inspection has worked to implement two new regulations:

The Seafood Import Monitoring Program, which established traceability requirements for certain priority fish species entering U.S. commerce.
The international import provisions of the Marine Mammal Protection Act, which require that seafood exported to the United States is from fisheries with measures in place to reduce the bycatch of marine mammals that are comparable in effectiveness to U.S. measures.

We are dedicated to the implementation and administration of these regulations and have engaged the governments and seafood producers of more than 100 nations this past year to explain the requirements of these regulations and gather information about their fisheries. In addition, we issued a report to Congress on international compliance with another law intended to combat illegal, unregulated, and unreported fishing, to reduce the bycatch of protected species, and to ensure adequate shark conservation measures on the high seas.

Read the full story at NOAA Fisheries

To Combat Illegal Fishing, Feds Propose Seafood Traceability Program

February 15, 2016 — The National Marine Fisheries Service is proposing a new program meant to improve record keeping about seafood imported to the United States.

In early February, the agency announced a new traceability plan that’s meant to help combat illegal fishing and seafood fraud. NMFS Director of Office of International Affairs and Seafood Inspections John Henderschedt said the federal government wants a better record of who is catching seafood and where it’s landed before it shows up in U.S. stores.

The proposed program would apply to about 13 types of fish, including Pacific cod, red king crab, shrimp, sea cucumber and others. Importers would be required to track where it was caught, who caught it, the type of gear that was used and where it was landed.

“In instances where the data is absent, or instances where there are other issues with the quality or the completeness of the data, we would then move to an investigation stage,” Henderschedt said. “As this international trade data system develops and once we’ve been able to identify what the key chain of custody data elements are, we anticipate establishing additional reporting elements associated with the chain of custody, but I’ll reiterate that for now, those are a record-keeping requirement.”

Henderschedt said that NMFS already has that information for domestic seafood, so fishermen and processors here won’t be asked to do anything differently. But it would add information that isn’t tracked right now for international imports.

“We do not have laws that allow us to gather the data to ensure that we can carefully examine the legality of catch and the chain of custody of that product as it makes its way to the U.S.,” he said.

Read the full story at Alaska Daily News

Feds fight fish fraud with new recordkeeping rules

February 8, 2016 — The National Marine Fisheries Service announced last week that it is implementing a new tracking program for seafood imports to help combat illegal fishing and seafood fraud.

Importers will have to track where fish were caught, the type of gear used and where it was landed.

Director of the Office of International Affairs and Seafood Inspections John Henderschedt said the federal government wants a better record of who is catching seafood and where it’s landed before it shows up in U.S. stores.

The proposed program applies to about 13 different types of fish, including Pacific cod, red king crab, shrimp, sea cucumber and others. Eventually, Henderschedt said it could be expanded to more species.

Henderschedt said NMFS already has that information for domestic seafood, so fishermen and processors here won’t be asked to do anything differently. For now, consumers won’t have the new information about imported seafood.

Read the full story at Alaska Public Media