As President Donald Trump’s trade dispute with China continues to drag out, some of Alaska’s biggest exports expect to be hit with even steeper tariffs than they’ve seen in recent months.
Now, the timber and seafood industries are trying to figure out how to do business as the pressure mounts.
The Alaska Seafood Marketing Institute is always on the lookout for innovative ways to create demand for the state’s catch. Sometimes that includes sending salmon to influencers on Instagram.
Other times, strategizing how get more of the product into the global market. Jeremy Woodrow, a director at the organization, says that’s what they’ve always done.
“But the urgency is probably greater than it has been in recent years,” he said.
That’s because some types of fish caught in Alaska could be 25% more expensive when the product is sent to the markets in China — a country that buys about a quarter of the state’s seafood.
Earlier this week, China’s Finance Ministry announced it would be increasing tariffs. A move prompted by President Donald Trump’s latest wave of tariffs imposed on Chinese goods.
The tariff increase cuts both ways. Processed seafood that’s exported back to the U.S. could be subject to a 25% tariff imposed on China.
Woodrow says that’s created some uncertainty for Alaska’s seafood industry.
“When a product is now subject to increased tariffs, that makes that product more expensive to consumers,” Woodrow said.
And those consumers might just go for a cheaper alternative to Alaska’s wild caught fish. But Woodrow says the industry is already thinking about some workarounds. Right now, Alaska seafood is processed and sold in China. That’s where the tariffs stack up.
But having the fish processed in Poland could be a way to avoid that.
So, Woodrow doesn’t think it’s all doom and gloom.
“There is reason to be concerned,” Woodrow said. “However, I don’t think the sky is falling yet.”
But the situation is very different for Eric Nichols at Alcan Forest Products in Ketchikan.
“We don’t have many options to put that log in another marketplace,” Nichols said. “And so we’re very dependent upon what happens with that Chinese market.”
Nichols will be on the hook for a 20% tariff for spruce trees shipped to his biggest customer: China.
His company sends mostly barges of young growth trees harvested from Southeast Alaska to the country, and he says that’s the problem.
He doesn’t have enough high-value product to help ride out the volatility.
“When we don’t have the access to old growth anymore, then we don’t have those diversity of markets,” Nichols said. “So if we have one interruption like these tariffs, then it puts you in a situation were you got to decide whether you’re going to be able to stay in business or not.”
That’s a big concern among Southeast Alaska’s small, struggling timber industry.
A few efforts underway could result in more old growth trees being harvested in the region. But in the meantime, Nichols is trying to get by now, and he says this trade dispute is making it harder.
Still, he’s not ready to stop his operations just yet.
“You want me to lay off everybody?” Nichols asked. “I have bank payments. I have equipment payments. I have employees that depend on us for a very regular paycheck.”
The tariffs increase on U.S. exports could take effect June 1 if a deal between the White House and China isn’t reached.