Prices Likely to Spike for Commmon Goods as Geo-Political Tensions Rise

In today’s global economy, what happens in one part of the world – sometimes in one specific country – can set off a chain reaction likely to have far-reaching effects for consumers everywhere. When Panama Disease hit and peaked in Central America in the 1950s, for example, it wiped out thousands of acres of banana plantations that caused a worldwide shortage of the fruit, even forcing growers to abandon their favored cultivar and go in search of new types. Today, most of the world eats an entirely different kind of banana – the Cavendish – because of this. Like bananas, global products of all kinds are not immune to the effects of global markets. Recent announcements and economic policies have U.S. markets and consumers poised for a price hike for common steel and aluminum products. From soda cans to new cars, hundreds of industries are likely to see costs go up. Yet these products are far from the only ones being impacted by global geo-political tensions and sharp changes in demand and consumer preferences.

Food

Global food prices are hitting new highs as demand for meat, dairy, and wheat from countries with expanding populations continues to surge. U.N. food agency data shows global food prices are up 7 percent from a year ago and ahead 17 percent from a low set in early 2016. According to analysts, there has been a growing global demand for meat, particularly for beef. So strong is this demand that global meat has outpaced most other major food commodity groups, according to U.N. data.

Common Household Goods

Yes, even toilet paper is not immune to drastic price hikes and consumer panic. Just this week, a spike in the price to produce toilet paper in Taiwan cause panic to a point where lines formed outside of local grocery stores as people snapped up toilet paper and paper towels in bulk. The mess began on February 23rd when, according to The Economist, Taiwanese retailers, including several supermarket chains, said that toilet-paper producers would increase prices by as much as 30 percent in March because the cost of raw pulp had gone up.

Pearls

Political uncertainty in the South China sea has forced the price of pearls upward, much to the dismay of traditional brick-and-mortar and online retailers throughout the U.S. Leon Rbibo, who runs two of the top pearl websites in the U.S., The Pearl Source and Laguna Pearl, says military escalations in this part of the world can drive costs up “literally overnight,” since a large portion of the world’s favorite gemstone is imported from this area. Add to that the implications of Brexit, which is destabilizing world currencies, and you have a recipe for higher costs.

Gas and Other Fuel Types

There was a brief respite from the pump for many U.S. consumers over the last year, but don’t bank on that trend continuing, analysts say. According to AAA and the transportation industry, more than half of the country is likely to see a significant spike in the average cost for a gallon of unleaded gasoline. According to AAA, there are numerous reasons for the hike: This year “has seen fluctuating crude oil prices, strong gasoline demand and new U.S. oil production records creating a volatile gas price market from month to month for consumers,” Jeanette Casselano, AAA spokeswoman, said. “Typically, March brings more expensive pricing as days get longer, weather gets warmer and refinery’s gear up to switchover to pricier summer blends.”

Bourbon (and Other U.S. Produced Spirits)

New U.S. tariffs have other countries considering raising duties of their own. The European Union could choose to retaliate by going after peanut butter, orange juice, cranberries, and yes, even that world-famous Kentucky bourbon.

The European Union is the first trade partner to offer specific steps and products if the U.S. is to proceed with certain proposed tariffs, including on steel. Canada has also promised countermeasures. And Mexico, China and Brazil are said to be weighing options.

 

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The Top Products Chinese People Want

Chinese People Love Great Products

China is one of the most attractive export markets for products and services from different parts of the world. Its huge population and workforce, fast-growing middle class, accelerating consumption, as well as willingness to import are some of the factors that make China an attractive export destination.

To tap the might of consumers in the populous East Asian country, however, sellers and manufacturers first have to identify what the market wants. In light of this, we have compiled a list of the top products Chinese people desire to lighten your load along the way.

Clothing and Footwear

China’s large population makes it an attractive market for garments. An HKTDC Research article reveals that clothing market demand in China is high and keeps growing year after year. Experts predict that the industry, which was worth around RMB1,457.8 billion in 2017, would reach an estimated RMB1,592 by 2019.

The demand for clothing in China is so vast that shoppers are fast turning to online marketplaces to buy garments directly from overseas retailers and brands. Around 24% of consumers in China are expected to buy across borders this year alone, per figures released by eMarketers.

Similarly, there’s massive demand for footwear in China, with sneakers being one of the most demanded. Footwear sales figures for 2017 in mainland China was put at RMB381.9 billion. Of this, data show that women shoes brought in the most revenue, fetching around RMB184 (48%). Men’s shoes generated the second highest revenue at RMB144.2 billion (38%), while children’s shoes brought an estimated RMB53.2 billion (14%).

It is predicted that the footwear market in mainland China will be worth a whopping RMB487.4 billion by 2021.

Beauty and Personal Care

Driven by rising incomes and awareness, China’s beauty and personal care cosmetics market is one of the most attractive. The industry has been growing fast thanks to an increasing number of affluent consumers who are willing to splurge on quality beauty and personal care products that make them look younger and attractive.

The industry made an estimated RMB251.4 billion in domestic sales in 2017 alone. The world’s most populous nation is projected to become the largest market for personal care and cosmetic products in the next 5-10 years.

Vitamins and Supplements

As lifestyle gets busier, Chinese shoppers are becoming more and more health-conscious. Along with the demand for running shoes, there’s been a surge in the market for vitamins and supplements. For China, being one of the world’s fastest-growing economies came at a cost in the form of an overcrowded transportation system, gridlock traffic, severe air pollution, etc., all of which make the environment less healthy.

This, coupled with higher disposable incomes, caused Chinese consumers to turn to health and wellness products. In fact, consumers in the world’s fourth-largest have become so focused on health and fitness that the demand for vitamin and minerals outpaces GDP growth, according to a New Hope article.

Maternity and Baby Products

China’s relaxed family planning policy has increased demand for baby products such as infant formula. There’s been a boom in demand for maternity and baby products following the implementation of the new legislation which now allows a second child in the family.

A piece reveals that the Chinese baby product has grown more than 250% in five years, accounting for around $75 billion. With the plan now fully in place, the maternity and baby products sector is expected to surpass RMB3 trillion in 2018.

Food

Demand for food products like soybeans is high in China. The country is projected to become the largest food importer by 2018, importing around $79 billion worth of food items each year.

Other top products Chinese people want include jewelry, electronics, gadgets, and wine.

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