I ended last year’s guest column optimistically looking ahead to 2020, to ending the uncertainties of 2019. Few could have predicted that in addition to ongoing trade policy challenges, the world would face a global pandemic. The COVID-19 pandemic caused downturns in world economies, disruptions in channels of distribution and supply chains, constraints in global logistics, and cancellations of nearly every trade show and trade event beginning last March. As of mid-December 2020, COVID-19 infections are still rising in 64 countries. Global real G.D.P. is expected to see a contraction between -4.2% to -5.4% in 2020. Trade policy remained uncertain and chaotic in 2020. As a result, Maine lobster exports were down -25.16% thru October 2020 compared to the same time in 2019.
Seafood Tops Maine’s Exports in 2020
Nonetheless, Maine seafood topped the state’s exports in 2020. This marks the 7th straight year seafood has been Maine’s leading commodity. Through October 2020, Maine exported over $304 million (USD) of seafood products globally.
Seafood exports were heavily driven by lobster exports, with most coming from live lobsters. Maine’s top international markets were Canada, China, Hong Kong, Korea, and the United Kingdom. Highlighting the global demand for Maine lobster, Maine lobsters were exported to a total of 29 countries including Israel, Vietnam, Denmark, and Costa Rica.
2021 – an uncertain year ahead
Global economic recovery rates remain uncertain for 2021. According to Euromonitor International’s Recovery Index (forecasting five key indicators), most advanced economies will not fully recover to 2019 levels until the fourth quarter of 2021. China will likely be the only major economy to rebound to pre-pandemic levels by the end of 2020. The world’s economic recovery will be dependent on continued vaccine developments.
Trade uncertainties will likely remain in 2021. Trade issues with China are not going away; the implications of BREXIT are unclear; several countries continue to sign multilateral trade agreements which the U.S. is not a part of. The new Biden administration will understandably be focused on the pandemic and economic recovery. Its trade actions remain to be seen, however, they are likely favor a return to more predictable and stable policies.
There are a few hopeful signs. The E.U. and the U.S. are closer to implementing a five-year tariff exception for U.S. lobsters. China continues (albeit slowly) to improve its monthly purchases of U.S. goods covered by the phase one deal between the United States and China, including U.S. seafood purchases. And the world’s largest global seafood trade event, Seafood Expo Global, scheduled for early September 2021 in Spain, could become a reality.
Perhaps most hopeful is the continued resiliency of the Maine lobster industry and its reputation abroad as a hardworking, sustainable fishery with a long heritage and the world’s best lobsters.
Here’s to fewer uncertainties in 2021. This time, I hope I am right!
Jeffrey Bennett is a Senior Trade Specialist and Canada desk director at the Maine International Trade Center.