The way Chinese producers deal with Trump’s new rates

About 4,000 exhibitors gathered for East China Fair, a commercial import and export exhibition in Shanghai this week and are not foreigners for American tariffs.

The Huahai hair accessories manufacturer in the province of Zhejiang in East China had its products such as red, white and blue hair – the colors of the American flag – slapped with an additional 10% rate during the first term of President Donald Trump.

Owner Xie Yanjuan said that her business has survived by lowering prices.

“Our profit margins were better during the first commercial war,” she said. “But round after the round of additional rates, it is difficult to support a business.”

President Trump has already imposed 10% in addition to all Chinese exports last month. On Tuesday, this rate doubled to 20%, because China is, according to Trump, does not make enough to stop the flow of chemicals used to produce fentanil drugs. At the same time, Mexico and Canada will have an additional 25% fee for their exports starting on Tuesday about the Fentanil’s issue.

China He says that American rates are a form of “intimidation”. Replied with Reprisal rates of 10 to 15% in American agricultural products largely and restricted exports to 15 American companies.

Hangzhou Chaoshi shoes produce curcutoane for European and American brands such as Clarks, Walmart and Disney. His main business is in Europe although 20% of their business are from the US

“Our customers asked us to reduce the price, because their costs increased. But we make rubber boots from the middle to the sea. The cost of raw material is increasing, “said foreign sales manager, Alex Tu. “The price of the rubber has increased by 20%, then we have another 20% in the rates until this year, so our prices are under pressure.”

Wenzhou Mingqi Paper Industry, which produces printed paper towels and car tissues, has been requested by customers to share the task of additional tariffs.

“We couldn’t afford it, so I said no,” said owner Huang Shouhao. Its products still arrive in the US, but in an indirect way.

“I saw that sales in Vietnam have grown, and then they are actually exported to the US that they only return through Vietnam,” Huang said.

In this way, the Chinese exporters and the American importers Try to mask the origins of the products and avoid our tariffs.

Manufacturers who control their entire supply chain, such as the Shaanxi Longstar Christmas Armo manufacturer, the new material can reduce prices.

“We will reduce our prices accordingly. Our factory produces everything, from raw materials to the finished tree, so we are fine, ”said the sales manager, Li Linjing.

For now, e -commerce sellers are safe from US tariffs due to a relief for all products that cost $ 800 or less. Trump said he would close this lacuna, Although this plan is currently on hold.

“Each company should be adaptable,” said Sophia Li, Boss at the Zhimaang Electronic Commerce Consulting Group. Her company helps companies to carry out their electronic commercial sites and set up stores on platforms such as Amazon, Tiktok and Walmart.

“We should prepare in two ways: to increase the competitiveness of our products and to explore other markets to diversify the risks,” she said.

However, they do not recommend giving up the US market, as Americans are still buying more than any consumers around the world.

“The US is a large market; Its purchasing power is obvious. We should try our best to grab our slice from this cake. “

Further Research by Charles Zhang.