Trade tensions and tariffs between the United States and key trading partners blunted what may have been a banner year for Maine exports.

The state shipped $2.8 billion worth of commodities and manufactured goods overseas in 2018, a 4 percent bump from the year before, but less than in 2016, according to federal data.

Last year was a modest gain for the state, especially amid worsening trade conditions between the U.S. and countries such as China and Canada, said Wade Merritt, president of the Maine International Trade Center. “Four percent is a good, solid year for us,” he said.

But the final result is a far cry from where Maine started out.

Export values grew by 9 percent during the first six months of last year, then abruptly leveled off, Merritt said.

“We had a nice growth trajectory,” he said. “Comparing the second half of the year, it was flat.”

Last March, the Trump administration tacked a 25 percent tariff on imported steel and a 10 percent tariff on imported aluminum.

U.S. trade barriers provoked retaliation from its trading partners and tit-for-tat tariff hikes between the U.S. and China, including a 25 percent import tax on lobster to that country last summer.

Canada’s retaliations also hit Maine exports in the middle of the year, including new tariffs on boats, condiments and poultry.

Given that few other things changed in the economy over the same period, tariffs and trade disputes seem to have impacted export performance last year, Merritt said.

“I wouldn’t go so far as to say it was the only thing that happened, but it certainly didn’t help,” he said.

In his 20 years at the state trade center, he has never seen this level of uncertainty on multiple global fronts simultaneously, and that posed serious challenges for businesses that export goods, Merritt said.

“The trade policies matter, but also what ended up happening is that a lot of uncertainty was injected into the market,” he said.

Maine’s top five exports last year – seafood, electric machinery, fuel, aircraft and parts, and forest products – were valued at $1.5 billion, more than half of the state’s total exports.

Canada remained Maine’s dominant trading partner, buying $1.4 billion worth of goods and materials. China, Malaysia, Italy and Japan were the next top export destinations last year.

Live lobsters were Maine’s single most valuable commodity in 2018, worth $386 million, almost 19 percent higher than the year before.

Added business with Canada, China, Hong Kong, Vietnam and Thailand, among other countries contributed to that growth.

But even that figure masks the possible windfall that might have occurred if tariffs hadn’t gotten in the way, said Annie Tselikis, director of the Maine Lobster Dealers’ Association.

About 80 percent of U.S. live lobster exports are landed in Maine, but often are recorded as an export from elsewhere because they fly out of places such as Boston’s Logan Airport.

In the first six months of last year, the U.S. exported $76.4 million worth of live lobster to China, a 119 percent increase from 2017, according to federal trade numbers.

That growth reversed as soon as China enacted its tariffs last summer.

“Our trajectory for 2018 was massive,” Tselikis said.

The U.S. still shipped $147 million in lobster to China in 2018, a 14 percent boost from the year before, but with the tariffs in place, it is not an accurate depiction of the market there, Tselikis said.

“I think that what has been left out of the narrative is what could have been,” she said.

Maine lobster dealers also are contending with a recent trade deal that gives Canadian lobster tariff-free access to the European Union, making Maine lobster less competitive there.

Tom Adams, CEO of Maine Coast, a lobster exporter in York, said his company made money last year, but just barely. His 2019 budget was built expecting tariffs and other trade barriers to remain in place, but he’s hopeful a meeting between President Trump and Chinese President Xi Jinping this spring could solve the trade impasse.

“We are hoping the tariffs get lifted in China, that could be anytime,” Adams said. “But we are budgeting and planning for it not to occur, that is the only thing we can do.”

Peter McGuire can be contacted at 791-6325 or at:

pmcguire@pressherald.com

Twitter: PeteL_McGuire

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