China's annual imports of seafood and fish products amount to 20 billion US dollars, and it has clearly become a major exporter of seafood and fish products worldwide. What is more interesting is that today China has introduced a series of regulations to reduce the import tariffs on popular seafood products. Since January 1, 2017, Chinese importers will enjoy a variety of tax benefits, saving millions of dollars annually. What does this mean for exporters? The increase in potential demand and lower domestic taxes means that imports will increase substantially.

    China lowers import tariffs on seafood

    Countries that do not currently enjoy a free trade agreement or have a preferred supplier status are eligible to enjoy the new tax rate in China. As a shortcoming in China's supply chain, products in 10 groups will receive “temporary customs duties for MFN status of imported goods”, such as Arctic sweet shrimp, crab, squid and six varieties of frozen tuna.

    China's domestic production cannot meet the growing demand for the population. Among them, the growth of seafood demand is particularly prominent, especially in China's coastal cities, such as Shanghai, which urgently needs international suppliers to make up for the shortage of domestic supply. Let's take a look at the details of each major product category, so that you will have an in-depth understanding of the shortage of Chinese fish species and why the import volume will increase.

• Squid – China is by far the world's largest importer of squid, with imports starting at $740 million in 2015 alone. Since January 2017, import tariffs on fish have been reduced from 10% to 5%. During this period, due to the increasing domestic demand in China, squid and white pelicans are usually processed and returned to the mainland market. Some large Chinese fish processing companies say the domestic market accounts for 50% of their sales.

• Tuna – Although Chinese fishing boats catch tens of thousands of tons of tuna every year, exporters are obliged to import tariffs on six varieties of tuna. The import tariffs for albacore tuna, yellowfin tuna, bigeye carp, and Atlantic, Pacific and southern bluefin tuna have been halved to 6%. A series of latest agreements and the launch of products with Chinese characteristics, such as canned domestic consumers and frozen tuna, will benefit exporters. The annual import of frozen tuna in China alone is about $30 million.

• Arctic sweet shrimp – Chinese consumers love Arctic sweet shrimp, which imports more than $160 million a year and will enjoy a 2% tariff. Canadian producers will be the biggest beneficiaries of tariff reductions, while in North America alone, Arctic shrimp exports reached $104 million in 2015.

• Frozen crabs and live crabs – whether frozen or live crabs, including gold king crabs, import tariffs will be reduced from 10% to 5%, and 14% to 7%. The annual import volume of related products is already very large, which is good news for international exporters. Imports of frozen crabs have soared more than $170 million annually. At the same time, the import of live crabs in China in 2015 was as high as $311 million. This time, reducing import tariffs, Canada and the United States will be the biggest beneficiaries.

• Lobster and freshwater lobster – whether frozen or non-frozen, the import duty on shrimp of each species is reduced from 15% to 10%. At the same time, China's annual imports of lobsters (including rock dragons and lobster species) are nearly $500 million compared to the imports of competing countries. Although New Zealand is China's largest supplier of lobsters, New Zealand has enjoyed a free trade agreement with China and will not enjoy lower tariff discounts. Exporters have realized that it is now their gold business opportunity to grow the Chinese lobster market.

    If you pay close attention to the movement of the Chinese seafood market, as mentioned earlier, lowering import tariffs means lower costs for importers. This policy of benefiting the people will stimulate market demand and is good news for every exporter.