The men and women who make their living from the blue crabs in the Chesapeake Bay have withstood their share of troubles in keeping alive a Maryland tradition: pfiesteria fears, meager catches and government-imposed fishing limits.

But nothing compares to the threat from imported crab meat now flooding into the United States from Asia. Last year alone, imports grew by 78 percent. U.S. crab packing plants, which dot the East Coast from Maryland to Florida, are losing customers to the importers; and last year, industry records show, 13 of the country's 137 crab plants shut their doors for good.

What makes the threat particularly upsetting to the watermen and the packing companies they supply is that one of the biggest importers of the Asian crabs is Phillips Seafood, the restaurant chain and Maryland institution that has built its image and success on the Chesapeake Bay blue crab. Since 1990, Phillips has built eight crab processing plants in three Asian countries, with plans to open three more. It uses this imported crab meat in its nine restaurants and also sells it as Maryland-style crab cakes and crab soup to supermarkets.

The influx of Asian crab meat has forced the Maryland crab packing industry, with its small-town business ways that have endured for more than a century in hamlets along the Eastern Shore, to confront the realities of the new global economy. And caught in the middle is Gov. Parris N. Glendening (D).

When Maryland's packing industry asked Glendening for $100,000 to help it lobby the federal government for trade curbs on imported crab, Glendening consulted with Phillips Seafood. Then he refused the request.

"The crab industry is an incredibly important industry in Maryland, and we put a lot of support into issues that help the watermen," said Glendening's spokesman, Michael Morrill. "We also have people in Maryland who are very involved in importing crab meat. The governor didn't think it was appropriate to choose one Maryland interest over another Maryland interest."

Mark Sneed, president of Phillips Seafood Inc., said the company was forced to turn to Asia in the late 1980s in order to find a steady, year-round source of crab meat. "We are not an overseas company; we pay state and federal taxes. We found a niche for our product, market it successfully and employ a lot of people in the U.S. We have done nothing wrong but created a successful product."

But there is no doubt that the impact of the imports could be devastating, according to Doug Lipton, a marine economist at the University of Maryland at College Park. "Of all the problems the Maryland watermen face, this may be the most real and most certain," he said. "You look at the numbers and imports coming into the country, and you know it's coming in very large and it's accelerating."

Surge in Imports

For the past 20 years, crab meat imported to the United States has come mostly from Mexico and Venezuela and from the same species of crab found along the U.S. East Coast -- the Atlantic blue crab. And imports stayed at relatively stable levels.

But in the early 1990s, a new species of crab from Asia -- the blue swimming crab -- showed up on the U.S. market and has been filling shelves and refrigerators at a dramatic pace. Imported crab meat surged from 11.6 million pounds in 1997 to 20 million pounds in 1998, compared with domestic production of about 9 million pounds, according to the National Marine Fisheries Service. Foreign crab meat now controls nearly three-quarters of the domestic market that had been dominated by American crabbers as recently as 1994.

Phillips, a privately held company, opened a crab processing plant in the Philippines in 1990, followed by others in Thailand and Indonesia. It now ships "a couple hundred thousand pounds" of Asian crab meat to the United States each week, said Sneed, who declined to give specific figures.

"We built a reputation on quality seafood," Sneed said. "When we can't find quality shrimp, we have to look overseas. In terms of crab meat, we made sure our restaurant gets the best quality. We do that best from sourcing from plants that we control."

American watermen who fish the crabs have not yet felt the full impact of the imported processed crab meat, because they still have a local market for live crabs. But those who sell crabs to be processed at packing plants are seeing orders slow down and the price for their crabs dip. J.M. Clayton Co., of Cambridge, for example, is paying $16 a bushel for female crabs this year, compared with $25 a bushel last year.

"It's threatening our very livelihood," said Jack Brooks, co-owner of Clayton, a 109-year-old, family-owned crab processing plant that has lost 25 percent of its business this year. "I'll be buying less crabs if I don't have the sales for meat this fall. We'll be taking less for our finished product, paying less to the watermen for the raw product. Everybody's working for less. I was just saying to someone today that we're going to find out how little we can work for."

The American packing industry says the imports are designed to put it out of business.

"Phillips has said they can't get enough crabs here," said James Taylor, a Washington attorney hired to represent the American packers in their trade curb petition. "If they really wanted to get crab, they could have opened up plants in the South, in Louisiana, in the Gulf. They went offshore because they thought they could make a killing. And they are."

But Phillips argues that its importing success actually has helped the entire crab industry by introducing large segments of America to the crustacean.

"We've invested tens, hundreds of thousands to grow the market for crab products," Sneed said, noting that Phillips has sales offices in Chicago, among other places. "There is a completely unfilled market in middle America and the West Coast because they haven't had access to the product.

"This is going to be one of the hottest food trends."

Crab vs. Crab

Compared with the Atlantic blue crab, the Asian crab is bigger, meatier and is processed with fewer bits of shell. That makes it ideal for restaurants and food processing companies.

"We listened to what chefs and restaurants need," Sneed said. "We know that pasteurization works better for them than fresh, because it has a longer shelf life. We know that they don't want shell in the crab meat and, through our production techniques, we are able to deliver meat without shells. In our Baltimore restaurant, we used to have four people who all day, all they did was go through crab meat looking for shell. Now we have none."

Some say the Asian meat is also blander and lacks the sweet taste of the Atlantic blue crab. Phillips says its Asian crab meat is comparable in taste to local crabs.

The cost of processing crabs in Asia is about half that in the United States, according to Lipton, the marine economist. Asian workers are paid $2 to $5 a day for labor in the Philippines and Thailand, compared with $7 to $8 an hour in the United States, said Eddie Gordon, president of the National Blue Crab Industry Association, which represents Atlantic blue crab packing companies from Maryland to Texas.

Phillips said that it does not undersell domestic competitors and that its wholesale prices are comparable to those charged by U.S. packing companies, but it declined to disclose those prices. The company offers quantity discounts to its wholesale customers and other incentives.

"They give us consistent pricing, offer marketing material and color brochures, their salespeople work with our salespeople," said Karl Parks, at Sysco Foods-Baltimore, which supplies crab meat to thousands of hotels, restaurants, schools and hospitals in the Baltimore, Washington and Northern Virginia region.

Parks said he is selling Phillips pasteurized jumbo lump to his customers for about $17 a pound, while he is selling fresh jumbo lump from the Carolinas at about $15 a pound. In December, when fewer crabs are harvested locally and supplies dwindle, the domestic price will jump to about $21 a pound, while Phillips remains stable at $17 a pound, Parks said.

Emotions and Dollars

President Clinton would have to approve any curbs on crab meat trade after recommendations by the U.S. International Trade Commission. And as the lobbying intensifies, both sides are gearing up for an expensive battle.

"This one is as political as the dickens," said Jim Lighthizer, a former Maryland state lawmaker who is lobbying for Phillips. "It's all about whether the right guy gets the president's ear."

The Blue Crab Industry Association expects to pay $500,000 in its effort to get curbs by winter. "I don't think when the votes are counted that the importers will have a strong vote," said Taylor, the crab industry's lobbyist. "In this industry, there's culture, there's emotions involved in crabbing and the Chesapeake Bay, and any politician that overlooks that is treading on dangerous territory."

Phillips, meanwhile, is organizing other importers and is seeking help from the National Restaurant Association as well as several Asian countries. "If trade limits are approved," said Sneed, "it would put us out of business and it would mean fewer choices for consumers."

He said he is willing to spend up to $1 million to fight trade curbs. "We will do whatever is necessary," he said. "This is a fight for survival."

Name Game

Another front in the crab wars centers on labels: The U.S. packing companies and watermen want the Food and Drug Administration to require that the term "blue crab" be applied strictly to the Atlantic blue crab. Some importers sell "Chinese blue crab" and "Indian blue crab," creating marketplace confusion.

"If they're eating at Phillips, do they assume they're eating crab caught in the Chesapeake Bay? Or do they realize they're getting crab from Asia?" Lipton said. "It's really a question of information -- do the consumers know that and does he care?"

The crab dishes that dominate the Phillips menu are made from about 90 percent foreign crab meat and 10 percent local crab meat, Sneed said.

Promotional materials at Phillips restaurants include romantic passages about the chain's beginnings in an Ocean City crab shack and stress words such as "authenticity" and "tradition." Nowhere on the packaging for Phillips's "Maryland style" frozen crab cakes and crab soup is there an indication that the crab meat is not from Maryland.

"There is no requirement to tell people where it comes from," Sneed said. "If that becomes the guideline, we would certainly comply."

The watermen and the packing industry say their best hope for the future is to create a niche in the marketplace for the Atlantic blue crab, much the way the Wellfleet clam or Concord grapes have been able to link those foods to geography and lend a certain cachet to the product.

Glendening was more receptive to that argument; he directed $100,000 to a television, radio and print advertising campaign run by the state and designed to promote Maryland crabs.

Lipton, the marine economist, said it's unclear if niche marketing for local crabs can save the industry. "It's an experiment," he said. "Is the consumer willing to pay a premium price for crabs from the Chesapeake Bay? Maybe consumers don't care. . . . We just don't know the size of the market. Is it enough to sustain the industry, or is this the last gasp?"