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A possible trade war between the U.S. and Canada would have a big impact on Maine’s lobster industry, but it’s not immediately clear how exactly the state’s signature seafood export would be affected, according to industry officials.
Unlike more specific tariffs that President Donald Trump imposed on Canadian goods during his first term in office, the new 25 percent tariffs that he initially announced for cross-border trade — combined with Canada’s retaliatory 25 percent tariff on imported goods from the U.S. — would have directly affected the flow of lobster.
Adding to the uncertainty is that late Monday afternoon, Trump announced he was delaying the tariffs on the northern neighbor for 30 days after Canadian Prime Minister Justin Trudeau pledged to cooperate more on border security — following a similar move earlier in the day by Mexico.
If the pledged tariffs do eventually go through, it would not bode well for a cross-border industry that over decades has evolved into a symbiotic relationship between harvesters in Maine and processors in New Brunswick. Canada’s lobster processing sector is significantly more robust than its counterpart in the U.S., which means Maine fishermen and dealers send a significant portion of their catch north for processing before it enters the global market, both in the U.S. and abroad.
“The industries are very intertwined,” Marianne LaCroix, head of the Maine Lobster Marketing Collaborative, said about the fisheries on either side of the border. “Canada’s our biggest export market, and we are Canada’s second biggest export market.”
Hundreds of millions of dollars are at stake. Annual totals have differed significantly over the past dozen years, but according to data compiled by the World Institute for Strategic Economic Research, Maine businesses have shipped roughly between $200 million and $400 million worth of lobster to Canada each year since 2013.
“I think it’s really an unknown at this point what the overall impact will be,” LaCroix said earlier on Monday, before the tariffs were delayed.
Wade Merritt, president of the Maine International Trade Center, did not comment specifically on Maine’s lobster industry but said that the state’s businesses might not realize how much of their supply chain could be affected by the tariffs that have been floated.
“Likely retaliatory tariffs on U.S. exports will result in price increases that could impact both domestic and international sales,” Merritt said. “Many businesses may not even be fully aware of their international exposure as purchases of imported goods may be made through intermediaries in the United States.”
One thing that is known is that the American tariffs Trump had planned to impose on Canadian goods were different than they were seven years ago, when he previously sought to restrict imports from various countries.
Tariffs imposed in 2018 on goods from Europe and China were more sweeping, while those imposed on Canada targeted solar panels and steel. Because so much Maine lobster is shipped north across the border for processing, Canada in a way served as a backdoor for Maine lobster — after being processed and labeled as a “product of Canada” — to reach Europe and China without the retaliatory tariffs they imposed on U.S. goods.
During Trump’s previous stint in office, and during the COVID-19 pandemic that began late in his term, industry officials in Maine sought to promote lobster and expand markets domestically, to avoid the pitfalls that come with international trade.
LaCroix said there is good industrywide data for how much and where Maine lobster gets shipped for consumption in the U.S., but that demand for processed lobster rose domestically during the pandemic, as many restaurants shut down and more home cooks learned how to prepare their own seafood. Live lobsters tend to go to the restaurant market, she said, while processed products are most often found in grocery stores.
LaCroix said that because of the vagaries that come with exporting lobster abroad, the marketing collaborative will continue to focus on increasing domestic demand for Maine lobster.
“We’ve always focused on the U.S.,” she said. “There’s growth potential here, and it’s a safe market.”
