Thank you very much.
First of all, let me just say that the Fisheries Council of Canada fully supports the CETA. Our organization represents companies throughout Canada, from British Columbia to Nunavut. Our main supporters are vertically integrated companies. Those are companies that own their harvesting vessels, own their processing plants, and participate in marketing throughout the world. But at the same time we're also proud that the main fishermen's cooperatives in New Brunswick, Newfoundland, and Labrador are members of our council.
The CETA is a game-changer for several Canadian fisheries, most notably Atlantic Canada's shrimp sector, particularly cooked and peeled shrimp; lobster processing, which would have significant positive spillover effects for live lobsters; our herring sector; and our mackerel sector. The positive impact on the British Columbia groundfish and salmon sectors, and the Northwest Territories and prairie walleye and pickerel sectors creates new marketing opportunities for these sectors.
Ladies and gentlemen, reducing tariffs of 15% to 20%, to 0% in the world's largest seafood market will enable the Canadian fishing industry to put its market diversification strategy into full gear. Our objective as an industry in Canada is to reduce our dependence on the U.S. market, and I can report our industry has been successful in opening new markets in China and Russia in recent years. Now our strategy can focus on penetrating the EU market.
While the EU seafood market has grown substantially in recent years, as it has expanded to 28 countries and is now the largest seafood market in the world, Canadian seafood exports to the EU have not. In fact, in the period 2005 to 2012 our exports in terms of value to the EU dropped 28%. Export values to the U.S. have remained stable, but we have had significant growth in our sales to China and Russia. Our sales to China have increased by 38% and to Russia by 250%. China is now our second-largest export market, with Russia number four just behind the EU.
High tariffs in the EU have forced our industry to focus on emerging markets. When we talk about emerging markets we're talking primarily about markets where we see a growing middle class, we see new upscale restaurants being put in place, and we see countries, if you will, that have a fairly good per capita seafood consumption. We have been looking at countries such as China and Russia, but also South Korea and Thailand. The issue is that China and Russia are lucrative markets for us, but they're risky markets. Market access is not assured. Often we have abrupt impediments and closures to the market. The WTO and Codex rules and standards are making inroads into China and Russia, but it's slow. Right now, we are in confrontation, if you will, with Russia in terms of actions they have been taking with respect to our cold-water shell-on shrimp. And here it is just basically out of the blue.
The bottom line is we would like to see more involvement in terms of our diversification—we're doing a good job in Russia; we're doing a good job in China—but we want to get into the EU market. We want to build those partnerships, and we want to expand in that marketplace, and the CETA will do that for us.
The CETA is of particular significance to the cooked and peeled shrimp industries in Newfoundland, Labrador, New Brunswick, Quebec, and Nova Scotia. The market for that product is mainly in the U.K., Denmark, and Sweden. The tariff rate is 20%. Our access to that market is totally dependent on the EU unilaterally establishing low or zero tariff quotas to allow our products into the market for further processing in the EU. That's a major industry in terms of Newfoundland and Labrador, and that's basically the constraint they have in terms of expanding that market.
In recent years, for getting agreement, we would have to meet with the Danish processing association, the Swedish processing association, and the U.K. processing association to try to come together with mutually beneficial tariff quotas.
That has been relatively easy. Well, I shouldn't say “easy”, but it has been relatively straightforward in recent years as shrimp peeling and processing in the EU has declined. However, times are changing. What we see now in terms of the EU and Poland, Bulgaria, and Estonia is that they are establishing peeling plants themselves.
The current arrangement ends in 2015. We can see that we would have difficulty continuing that type of arrangement going forward. The CETA takes care of that. Basically, what the CETA does is get our cooked and peeled sector out of the dysfunctional EU autonomous import quota regime. This is a regime that is particularly difficult for our Newfoundland and Labrador shrimp fishery, as the inshore fishery starts in June or July, and by that point in time, much of the import quota into the EU has been or is being exhausted.
What you see happening is that the fishery continues, the cooked and peeled product is produced, put in storage in waiting until January 1 of the next year, and then dumped on the market. That's how dysfunctional it is. That is why the CETA is so important to us. That is why Earle McCurdy, who is head of the Fish, Food and Allied Workers union, has come out in support of the CETA.
Another example of how this is going to have positive structural impacts on our industry is in the processed lobster. Over 85% of our processed lobster products are exported to the United States. A growing market for the processed lobster sector is lobster tails and claws. We have made good inroads into the EU with this product; however, the tariff for the product is 16%. The elimination of that 16% tariff will enable that segment of our industry to expand significantly into the EU.
The expansion of our lobster processing sector, which is primarily in New Brunswick and P.E.I., is going to have a significant positive impact on our live lobster portion, which is primarily in Nova Scotia and, to some extent, Newfoundland. It will be drawing more lobsters into the processing sector out of the live market. Our live lobster sector is being inundated with oversupply and, as you may know, prices have been dropping quite a bit.
In summary, we see the CETA offering us important opportunities for market diversification, leading to enhanced prosperity for our companies and our workers.
I will say in closing that the Fisheries Council of Canada wants to acknowledge the great work done by trade officials at International Trade Canada and the Department of Fisheries and Oceans. We were kept abreast of developments. Our thoughts, suggestions, and concerns were sought and were taken into consideration.
Thank you very much.