Senate’s Pending Shrimp Legislation Threatens American Businesses and Consumers
Last-minute legislation in the U.S. Senate threatens to raise shrimp prices and create supply shortages in early 2018. Lobbyists and domestic politicians seek to disrupt the imported shrimp supply chain, which makes up over 90% of the U.S. market and is worth over 5.7 billion dollars per year. Such shrimp imports help fuel sales for thousands of U.S. businesses and should not be a target of economic brinkmanship. This threat to imported shrimp would negatively impacts U.S. retail and food service companies, which is bad for American consumers.
In July 2017, U.S. Senators amended the Seafood Importation Monitoring Program (SIMP) within an appropriations bill. SIMP is an electronic traceability monitoring program attempting to reduce illegal, unreported, and unregulated seafood. The global seafood industry overwhelmingly supports increased traceability and the motive behind SIMP; however, a reasonable amount of time must be allocated to ensure that implementation is achieved without damaging the aggregate shrimp supply and harming American businesses.
When SIMP was initially approved in December 2016, shrimp compliance was explicitly postponed due to conflicts with a World Trade Organization treaty. All other species were given over a year to become compliant. However, if Senate Bill 1662 (Section 513) is passed in its current form, shrimp importers would be required to develop new electronic traceability systems within 30 days. A mere 30 days! The end result would be a gridlock on shrimp imports into the United States. As companies rush to become compliant, many shrimp shipments would be put on hold in ports or downright rejected.
While U.S. Senators are supposed to represent their constituents, this piece of legislation would reward the minority of domestic shrimp fishermen at the expense of the U.S. shrimp industry and hurt the overall economy. Gulf State Senators who proposed this hasty bill modification seem to be favoring local industry at the expense of American businesses and consumers. And not surprisingly, lobbyists for domestic shrimpers have spent millions of dollars over the past decade. Senators need to understand that this rushed change to SIMP will reduce the availability of shrimp and harm all seafood lovers and American businesses like restaurants, which rely on these products.
Similar rushed restrictions of shrimp imports in other countries have resulted in skyrocketing prices, supply shortages, and economic loss. For example, in early 2017, Australia issued a temporary six-month ban on an estimated 30% of its shrimp supply. According to industry experts, losses exceeded 300 million dollars, and the Australian ban immediately increased the cost of shrimp by $3.80 per kilogram.
Ultimately, this legislation most harms the American consumer and benefits a small minority of Gulf shrimp producers. If the bill is passed in its current form, U.S. grocery stores and restaurants would experience interruptions in their shrimp supply. Shortages of shrimp due to immediate SIMP compliance would drive up prices just as consumer demand reaches its peak between the holiday season and Lent.
This proposed alteration of SIMP is reckless and will likely result in major economic consequences for U.S. businesses and consumers. We implore senators to employ careful, deliberate, and unbiased policymaking. We support and encourage improvements to traceability and transparency, but a sensible amount of time should be allowed to properly implement such programs.
