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https://www.shareandstocks.com/we-r...rs-at-china-trade-fair-lament-lack-of-buyers/
Canton Fair participants said global inflation was the biggest risk for their businesses as they attended the biannual trade event in person for the first time in three exhibitions.
The five-day fair – the largest of its kind in China – kicked off last Friday in Guangzhou, but many Chinese exhibitors said they were disappointed at the lack of foreign buyers, with some packing up and leaving early on the last day of the fair on Tuesday.
Many exporters taking part in the exhibition, especially small and medium-sized enterprises (SMEs), said they had not signed up or approached new foreign buyers during the event, while domestic buyers showed little interest in placing orders.
The fair’s operator did not release the session’s sales and foreign visitors numbers.
China's economic recovery stalls, growth slows to 4.9 per cent in third quarter
18 Oct 2021
Interest among the nation’s export manufacturers has been waning over the past year amid pandemic-related travel disruptions, which forced the fair to move online last year with exhibitors live-streaming their products.
But the fair had been suffering long before the pandemic mainly due to pressures from the US-China trade war.
Benlita Chen, an exhibitor and senior overseas sales manager with Guangdong-based Helenbo electrical appliances, said local buyers could not replace foreign ones, which previously dominated the fair.
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“For the same product, the retail price in the overseas market and the Chinese market is actually not that big, but the overseas market is definitely more profitable,” she said, adding her business generally finds it easier to sell overseas due to tax rebates and lower after-sales service.
As such, about 80 per cent of Chen’s company’s products are sold overseas with the rest sold domestically.
Hady Essam from Egypt, who has been live-streaming the fair via his Facebook and YouTube account, said many buyers from the Middle East are interested in new products and Chinese supply chain developments, “but they just can’t come”.
Ge Yun, who works for a wood product company in Shandong province, said on top of new orders, he had hoped to ascertain how foreign buyers were feeling about inflation and high shipping costs.
“The Canton Fair this time is not as helpful as we expected in grasping future trends in orders and exports,” he said.
But the biggest concern among exhibitors was the cost of production and the consequential rise in producer price inflation and lower profits.
Hady Essam from Egypt was live-streaming from the fair via his Facebook and YouTube accounts. Photo: SCMP
“Our company’s exports this year would be about the same as last year, but profits are down quite a bit because of the obvious devaluation of US dollar that drives up raw material and logistics cost,” said Chen, from Guangdong-based Helenbo.
“The current power shortage in China is also a big problem. We believe these will eliminate a lot of SME manufacturing exporters.”
Vicky Yang, a bag producer from Fujian province, said the cost of fabric, lanyards and all accessories needed to make her products has been rising.
“October is a month of increasing prices with a confusing supply chain. In terms of unit prices, I think the next few months will see a wave of price increases,” she said.
“We received no new orders at the Canton Fair this time, which was within our expectation. There are a lot of overseas orders via e-commerce, but we are very cautious about new orders, as long as we can maintain the operating expenses of the factory.”
Even with orders, she said her business had to be selective in regards to which ones it accepted to ensure it could guarantee delivery and secure higher profit margins.
Indian buyer Deepak Khanna said inflation was a global issue, not just for China.
“Manufacturing costs are soaring in China, as they are in India. Chinese products are still competitive on price, and there is no substitute for stability of production capacity, until the epidemic is over,” he said.
But he said China still held the top spot as the world’s best manufacturer and it would be hard for countries like India to replace it.
“Establishing a supply chain is a very long process, and China has taken the lead in establishing a complete supply chain,” he said.
Canton Fair participants said global inflation was the biggest risk for their businesses as they attended the biannual trade event in person for the first time in three exhibitions.
The five-day fair – the largest of its kind in China – kicked off last Friday in Guangzhou, but many Chinese exhibitors said they were disappointed at the lack of foreign buyers, with some packing up and leaving early on the last day of the fair on Tuesday.
Many exporters taking part in the exhibition, especially small and medium-sized enterprises (SMEs), said they had not signed up or approached new foreign buyers during the event, while domestic buyers showed little interest in placing orders.
The fair’s operator did not release the session’s sales and foreign visitors numbers.
China's economic recovery stalls, growth slows to 4.9 per cent in third quarter
18 Oct 2021
Interest among the nation’s export manufacturers has been waning over the past year amid pandemic-related travel disruptions, which forced the fair to move online last year with exhibitors live-streaming their products.
But the fair had been suffering long before the pandemic mainly due to pressures from the US-China trade war.
Benlita Chen, an exhibitor and senior overseas sales manager with Guangdong-based Helenbo electrical appliances, said local buyers could not replace foreign ones, which previously dominated the fair.
EVERY SATURDAY
SCMP Global Impact Newsletter
By submitting, you consent to receiving marketing emails from SCMP. If you don't want these, tick here
By registering, you agree to our T&C and Privacy Policy
“For the same product, the retail price in the overseas market and the Chinese market is actually not that big, but the overseas market is definitely more profitable,” she said, adding her business generally finds it easier to sell overseas due to tax rebates and lower after-sales service.
As such, about 80 per cent of Chen’s company’s products are sold overseas with the rest sold domestically.
The Canton Fair this time is not as helpful as we expected in grasping future trends in orders and exportsGe Yun
Hady Essam from Egypt, who has been live-streaming the fair via his Facebook and YouTube account, said many buyers from the Middle East are interested in new products and Chinese supply chain developments, “but they just can’t come”.
Ge Yun, who works for a wood product company in Shandong province, said on top of new orders, he had hoped to ascertain how foreign buyers were feeling about inflation and high shipping costs.
“The Canton Fair this time is not as helpful as we expected in grasping future trends in orders and exports,” he said.
But the biggest concern among exhibitors was the cost of production and the consequential rise in producer price inflation and lower profits.
Hady Essam from Egypt was live-streaming from the fair via his Facebook and YouTube accounts. Photo: SCMP
“Our company’s exports this year would be about the same as last year, but profits are down quite a bit because of the obvious devaluation of US dollar that drives up raw material and logistics cost,” said Chen, from Guangdong-based Helenbo.
“The current power shortage in China is also a big problem. We believe these will eliminate a lot of SME manufacturing exporters.”
Vicky Yang, a bag producer from Fujian province, said the cost of fabric, lanyards and all accessories needed to make her products has been rising.
“October is a month of increasing prices with a confusing supply chain. In terms of unit prices, I think the next few months will see a wave of price increases,” she said.
“We received no new orders at the Canton Fair this time, which was within our expectation. There are a lot of overseas orders via e-commerce, but we are very cautious about new orders, as long as we can maintain the operating expenses of the factory.”
Even with orders, she said her business had to be selective in regards to which ones it accepted to ensure it could guarantee delivery and secure higher profit margins.
Indian buyer Deepak Khanna said inflation was a global issue, not just for China.
“Manufacturing costs are soaring in China, as they are in India. Chinese products are still competitive on price, and there is no substitute for stability of production capacity, until the epidemic is over,” he said.
But he said China still held the top spot as the world’s best manufacturer and it would be hard for countries like India to replace it.
“Establishing a supply chain is a very long process, and China has taken the lead in establishing a complete supply chain,” he said.
