The latest edition of China’s Canton Fair, held in Guangzhou, drew a sharp rise in buyers from the United States and the European Union. According to event organisers, attendance by US buyers climbed 22.2 per cent from the April session, while EU buyer numbers surged 38.2 per cent. The increases outpaced the overall buyer growth of 12.2 per cent.
Easing trade tensions lift attendance
Visitors and exhibitors linked the jump in Western attendance to a recent thaw in trade tensions. In September, President Xi Jinping travelled to the United States for a meeting with President Donald Trump, raising hopes that the world’s two largest economies could avoid further escalation. The optics of that summit appear to have encouraged more American and European purchasing managers to return to the massive trade expo.
The fair, which concluded on Wednesday, is one of China’s most important venues for signing export contracts. More than 32,000 Chinese exhibitors displayed 4.88 million products, with the share of artificial intelligence-powered offerings up 14.1 per cent compared with the spring event.
Deal value rises modestly
Despite the stronger turnout, the value of export deals announced at the fair rose only 4.1 per cent from April, reaching US$26.75 billion. That total remains 8.7 per cent below the level recorded at the autumn 2019 Canton Fair, the last edition before the Covid-19 pandemic disrupted global trade.
The gap between visitor numbers and deal value suggests buyers were curious but cautious. Exporters on the floor said economic conditions in Europe and currency movements were making it harder to convert meetings into large orders.
Inflation and currency squeeze margins
Yulia Yuan, a foreign trade saleswoman with Tianwei Steel and Plastic Products Co, said European customers were becoming more price-sensitive as inflation squeezed household budgets. She expected demand for high-end products to shrink and predicted that goods offering good value for money would be easier to sell.
Raw material costs have risen by around 15 per cent over the past year, she added, but European buyers were willing to accept price increases of only 3 to 5 per cent. That left exporters with little room to negotiate. "You either take orders at a loss or turn them down," she said.
Yuan strength adds pressure
Lighting exporter Tan Jian pointed to a stronger yuan as another challenge. When Chinese manufacturers are paid in euros or US dollars and convert those earnings back into yuan, recent appreciation of the Chinese currency reduces their effective income. Higher input costs have compounded the problem.
Tan said the traditional model of cutting prices to win orders, then making money through large volumes, is no longer viable for many conventional export manufacturers. Companies will need to rethink how they compete, he argued, moving away from a reliance on low prices and toward stronger products and branding.
A cautious recovery
The Canton Fair numbers reflect a Chinese export sector that is recovering its ability to attract foreign buyers but still faces pressure from weak overseas demand and exchange-rate volatility. The jump in US and EU attendance is a positive signal, yet the modest growth in deal value shows that returning buyers are not yet ready to commit to large purchases at the same pace as before the pandemic.
