Stuff From China Could Cost 10% More

Long the land of low low prices, the prices on consumer goods imported from China could rise by as much as 10 percent this year. What’s changed in China?

  • Supply chains being scrutinized closer for lead, poison, other deadly defects
  • Government removing lucrative tax rebates for many exports
  • Rising wages
  • Plastic costs more because oil/petroleum costs more
  • New labor law
  • Ignored environmental laws now being enforced
  • Yuan’s value rising against the dollar
  • Uhoh, WallyWorld is going to be pissed.

    China’s Inflation Hits American Price Tags [NYT]
    (Photo: DCvision2006)

    Comments

    Edit Your Comment

    1. cobaltthorium says:

      Good – if things cost more people won’t buy as much useless shit.

    2. icruise says:

      What is the connection between the yen and China? (And no, the yen is not “worth more than the dollar — not by a long shot, since it’s still around 100 yen to the dollar. it’s just worth more than it used to be.)

    3. friendlynerd says:

      I think this is an adjustment long overdue. What sucks, though, is that most people won’t step back and evaluate what they really need. They’ll just whine to the government and/or the media about how they can no longer afford the lifestyle to which they’ve become accustomed.

    4. yesteryear says:

      china’s labor laws have a long way to go, but i see this as a positive for workers there. i hope it inspires people to buy american… at least until we find another developing country to manufacture our plastic crap for pennies.

    5. wwwhitney says:

      I think he means “yuan” not “yen”. “Yuan” is pronounced “yoo-en” so it sounds very similar to “yen”.

    6. wwwhitney says:

      Also, 2 years ago 1 US dollar was 8 yuan. Now it is 7.2 yuan. The Chinese government does not float the yuan like most other countries do to their own currency. One of the effects of buying so many US treasury notes is that it allows them to keep the exchange rate of the yuan artificially low, allowing their exports to be cheaper than they would be otherwise.

    7. theblackdog says:

      We’ve been bitching that China undervalues the Yuan against the dollar, and now there’s going to be bitching that the cost of imports will go up because it’s finally starting to adjust to the rate it should have been all along. What the hell man.

    8. homerjay says:

      Can’t we just rectify this situation simply by adding lead to everything? Lead’s cheap.

    9. timmus says:

      I’ve been telling people for years that this would happen. Once we pump enough money into China, the tide of cheap crap will end. So who will make all our crap in the 2010s? The per-capita income of India and Vietnam are less than half of China and they’ve got an extensive infrastructure in place, so my bets are on them.

      I’ve often wondered why capitalism just doesn’t root out the most dirt-poor port country, like Liberia, and put factories there, but I guess when you add up ten years of wages anyplace, it’s a drop in the bucket compared to the cost of construction and infrastructure.

    10. catnapped says:

      @homerjay: But it’s heavier and costs more to ship

    11. rbb says:

      That’s really going to cause problems for a lot of stores here because they are going to have to change all of their signage…

      The Dollar Ten store
      Dollar Ten Tree
      Everything’s a Buck Ten
      Dollar Ten General

    12. azntg says:

      @rbb: You forgot the Family Dollar Ten!

    13. HRHKingFriday says:

      Haha, sucks to be china when Walmart tells them to lower their prices or they’ll be dropped as a supplier. I guess with fuel costs, it’ll soon be infinitely cheaper to manufacture things locally.

    14. Rusted says:

      @timmus: We could make our own crap. Part of the reason that we don’t, is that it’s expensive to hire Americans, even one’s self.

    15. kcrusher says:

      “Good – if things cost more people won’t buy as much useless shit.”

      WORD!

      How many cheap plastic chotchkes do we need, anyways??

    16. synergy says:

      Smart work from China. It’s all downhill from here.

    17. pauliee says:

      Where are all the China naysayers now? This blog is full of commenters who have succumbed to American media’s fear-mongering about China and have no clue about the situation over here.

    18. side says:

      @icruise: Yuan (or RMB) is China’s currency. And no, it’s not 100 to 1 it’s 7.2 å…ƒ to 1 $USD. Which is way up from the 8.16 that had been stabalized in previous years. Since factory wages are not in USD, when you get 12% less goods, it costs 12% more. But know that US companies are already moving their overseas manufacturing to more “favorable” nations, i.e. Vietnam. These jobs ARE NOT coming to America, so stop deluding yourselves.