The NYT article, “Chewy Chicken Feet May Quash a Trade War”, leads me to mull over the potential trade dispute over tires and chickens:
“China is threatening to cut off imports of American chicken, but poultry experts have at least one reason to suspect it may be an empty threat: Many Chinese consumers would miss the scrumptious chicken feet they get from this country.
“We have these jumbo, juicy paws the Chinese really love,” said Paul W. Aho, a poultry economist and consultant, “so I don’t think they are going to cut us off.”
Chicken exports were thrust to the forefront of American-Chinese trade tensions on Sunday when China took steps to retaliate for President Obama’s decision to levy tariffs on Chinese tires. The Chinese announced that they were considering import taxes on automotive products and chicken meat, a development that some trade experts feared could escalate.
American executives expressed concern about losing what recently has become the largest export market for their chickens, one that is expanding rapidly as the Chinese population grows more prosperous. But the executives also expressed relief that, so far, Chinese importers have told them to keep the feet and wings coming.”
Most people look to China as a source for low-cost goods, but I don’t think many USA or EU clients are looking to buy tires without a name brand to assure them of the quality of this most important piece of safety equipment (my wife runs Michelins for instance). But while Chinese products have a reputation for poor or inconsistent quality (after all this is why PassageMaker assists clients with inspections and it is the ONLY business for our friends at China Quality Focus), foreign products often enjoy a privileged place in the Chinese marketplace. Especially foreign agricultural products, and it is far harder to copy a Georgia pecan, Scotch whisky, Spanish wine, etc. PassageMaker’s can help help foreign sellers research the Chinese market and establish distribution partners, much like a Sourcing Feasibility Study in reverse.
Let’s hope this increasing integration of the USA and PRC economies encourages expeditious and rational resolutions to such trade fights.