Southeast Asia is an increasingly important player in the US seafood market. Although stagnant fish stocks, growing demand for seafood products, and chronic overfishing are constraining mature fishery sectors, such as the United States’, the same trends are bringing about opportunities for countries with developing fishery sectors that can pick up the slack in the seafood market. In particular, Southeast Asian countries are well positioned to achieve this in the US market. While its share in the US imported seafood market is already substantial at 31% in 2010, the region is likely to grow more significant in the market thanks to its sustained expansion ofaquaculture, or raising fish in farms on an industrial scale.
The annual volume of worldwide catch has stayed at about 90 million metric tons since the mid-1990s, but the consumption of seafood is burgeoning. The United States, for instance, imported almost 2.5 million tons of edible fishery products in 2010, in addition to the consumption of domestically harvested seafood. This is a 5.7-percent increase from the quantity imported in 2009 and in sync with a consistent upward trend in US seafood consumption. (Even so, Americans currently eat less than half the government-recommended amount of seafood.) Imported seafood currently constitutes 84% of total US seafood consumption.
At the same time, American seafood producers are having a hard time keeping pace. “Once-productive waters in regions like New England have been hit hard by over-fishing, often followed by lengthy and controversial moratoriums to allow commercial species to recover,” TIME magazine notes. “American fishermen are hard pressed to keep up with domestic demand—and it wouldn’t be ecologically sustainable for long if they tried.”
The combination of sluggish supply and increasing demand of seafood in the United States is creating an opening in the US market. In 2010, the country sustained a trade deficit of almost $7 billion in fish and other marine products, the second-largest natural resource contributor to the national trade deficit after crude oil and natural gas. Southeast Asian countries ($3.4 billion), China ($2.0 billion), and Canada ($1.6 billion) dominated last year’s US imports of seafood products worth $11.2 billion.
Specifically, the United States faced a $3.3-billion deficit in seafood trade with Southeast Asian countries in 2010. This deficit accounted for almost a tenth of US total trade deficit of $37.3 billion with Southeast Asian countries, and almost half of the US trade deficit in fish and other marine products.
While around half of the seafood that the United States imports comes from aquaculture, domestic aquaculture provides only about 5 percent of the seafood consumed in the United States. The prospects of expanding aquaculture in the United States are uncertain because of concerns about its potential harm to the environment, an often unfavorable regulatory framework, and the high costs of maintaining aquacultural operations domestically.
The United States has little choice but to increase seafood imports. As natural seafood stocks are unlikely to meet increased demand and domestic capacity for aquacultural production has plateaued, future increases in supply may only come from foreign aquaculture.
Aquaculture in Southeast Asia is diversified, comprising freshwater fish, aquatic plants, crustaceans, marine fish, and mollusks. Shrimps and freshwater fish constitute the two most highly priced products of Southeast Asian aquaculture. Total output of Southeast Asian aquaculture tripled from two million tons in 1990 to seven million tons in 2005, and annual average growth rates in output in the 2000s more than doubled those during the 1990s.
With such a strong performance, Southeast Asian countries have faced accusations of dumping fisheries products, in particular catfish and shrimps, in the US market since the 2000s. Most recently in April 2011, the US Department of Commerce responded to anti-dumping claims by continuing to impose duties on certain types of seafood imports from Brazil, China, India, Thailand, and Vietnam. Failure to do so, the US government argues, is “likely to lead to continuation or recurrence of dumping and of material injury to an industry in the United States within a reasonably foreseeable time.” Responding to a Vietnamese complaint on the issue, the World Trade Organization circulated a panel report in favor of Vietnam in mid-July 2011 in an effort to settle parts of this trade dispute.
Another potential stumbling block for Southeast Asian countries in the US seafood market is the S.50 Commercial Seafood Consumer Protection Act currently under consideration in the US Senate. The act aims “to strengthen Federal consumer product safety programs and activities with respect to commercially-marketed seafood by directing the Secretary of Commerce to coordinate with the Federal Trade Commission and other appropriate Federal agencies to strengthen and coordinate those programs and activities.” Already, the Thai Department of Export Promotion advised Thai seafood exporters to prepare for the potential adverse effects this act may exert on their products.
Despite past challenges, many Southeast Asian countries are maneuvering to increase their share in the US seafood market. The Wall Street Journal recently reported that Indonesia, already the fourth-largest exporter of seafood to the United States, is modernizing its infrastructure as part of an effort to increase its share of the global seafood market. The country seeks to boost its fish exports by more than 70 percent in the next three years.
The opening is there for further Southeast Asian expansion in the US seafood market; it is likely that Southeast Asian exporters will also face rough waters.