• Seattle companies feeling effect of tariffs

    By: Linzi Sheldon

    Updated:

    SEATTLE - Some Seattle companies are already feeling the effects of retaliatory tariffs on American exports after the U.S. imposed tariffs on steel and aluminum from Canada, Mexico, the European Union, and India, as well as tariffs on steel, aluminum, and a myriad of other products from China.

    It comes as Sen. Maria Cantwell said the U.S. is in a trade war that could put people out of business.

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    ​Brian Bernard with Seattle's F.C. Bloxom Company said buyers in countries like India and China are now putting off orders because of increased costs due to tariffs.

    "You're sending these where?" KIRO 7 reporter Linzi Sheldon asked of a box of Washington apples.

    "Potentially to India," Bernard said, adding that he currently looking at domestic options for the apples originally intended for overseas. He said India's proposed new tariffs on American apples in response to U.S. tariffs on India steel and aluminum are hitting business hard.

    "It's stopped," Bernard said, "stopped the trade. As of the 21st, to our understanding, there will be an additional 30 percent tariff on these apples in India. That's on top of an already 53 percent tariff."

    Cantwell did not mince words in Washington, DC as she spoke to Commerce Secretary Wilbur Ross.

    "Do you think we're at a trade war right now? Because that's where I see us," she said.

    "As the president has often said, we've been at a trade war forever," Ross said. "The difference is that now our troops are coming to the ramparts."

    "No, Mr. Secretary, I want you to hear me," Cantwell said. "Apples and cherries are getting hurt."

    Cantwell also pointed out that in response to U.S. tariffs on China, China has announced tariffs on American seafood.

    "These people might go out of business while you're creating this trade war," she said.

    "Without trade and without exports, our company doesn't exist," Ron Rogness, Vice President of Corporate Relations at American Seafoods, said in a video with the Washington Council on International Trade. The Seattle company harvests and processes seafood, then distributes it around the globe.

    "Our employees are paid a share of the catch," Rogness said. "The higher the price for those products, the more money they make. Without exports markets, our employment and our income would go down substantially."

    According to Cantwell's office, the U.S. exported $1.3 billion in seafood to China, with more than 75 percent of those exports coming from Washington state and Alaska.

    KIRO 7 also contacted the Freezer Longline Coalition, a Seattle-based industry trade association representing 11 Washington and Alaska-based companies that participate in the freezer longline sector of the Alaska cod fishery.

    “The 25 percent tariff imposed by China on U.S. seafood imports to the country creates a significant barrier to entry for FLC members and other Washington seafood companies,” Executive Director Chad See said. “This tariff effectively closes the door on those efforts until there is a resolution to this trade dispute, while allowing competing products from other countries to expand their market share in the country.”

    “For us, overall activity has slowed, and so have inquiries,” CEO Sam Cho of Seven Seas Export said. Cho previously worked in the Obama administration as the Special Assistant to the Deputy Administrator of the US General Services Administration. His business exports egg products to Korea.

    “Most conversations or leads end with, ‘Let’s wait and see how things turn out,’” he said.

    Washington state's greatest annual agricultural exports include French fries at $756 million; apples at $721 million; dairy products at $366 million; and cherries at $358 million.

    And alcohol is facing potential tariffs, too.

    Canada responded to U.S. tariffs on Canadian steel and aluminum by issuing a list of American items that could face tariffs next month, including whiskies, like the ones made at Westland Distillery in Seattle. The European Union has included bourbon whiskeys in its list of retaliatory tariffs.

    "Right now, we make a lot more whiskey than we need to sell in the U.S., so a lot of the people that we have here, in terms of making whiskey, all those people are here basically for the products that we're going to be exporting in the future," master distiller Matthew Hofmann said. 

    Even some of Seattle’s tech companies are facing effects as well. Trade Tech provides supply chain management software to international transportation providers, importers, and exporters. If customers’ exports are reduced, CEO Bryn Heimbeck said, so is the company's revenue.

    “There is no question that the issue of Chinese lack of free trade and open market access is a problem that needs to be addressed,” he told KIRO 7. “The issue is, why not unite with our allies who face the same problem and work through the major international institutions that we worked so hard since 1945 to establish?”

    Ross said the tariffs will benefit the U.S. in the end.

    "The purpose of this is to get to an endgame that’s much closer to free trade than anything the world has seen before," he said. "The tragic fact is that historically we are the least protectionist country in the world, and we have the deficits to show for it."

    Susan Hutchison, the Republican candidate for Cantwell's seat in the Senate said, "I am in favor of American products being traded freely and fairly, where our intellectual property rights are respected and upheld."

     

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