The fall Canton Fair

I just returned from the Canton Fair.  I was there for all five days of Phase 2 and had occasion to talk to quite a few vendors.  One question I often ask vendors is how business is compared to a year ago, or even five months ago – since the spring fair.  Most vendors said that business was not good and the figure I got from several vendors was that booth visits were down about 30 %.  Some halls seemed busier than others but by the last day all of the halls were somewhat empty. The concierge at the hotel told me that it used to be that people would stay for the entire fair but now they attend for a couple days only and then leave. Like everything in China, the Canton Fair is changing as well. 

One day I walked over to the Jin Han fair, a parasite fair next to the Pazhou complex and I was shocked at how empty it was.  This was my third or fourth time at the Jinhan Fair and this was emptiest I had ever seen it. I can imagine that some vendors at the fair did not have even one visitor. It was that empty. 

When I called an old friend of mine in Shanghai, Nat, to catch up on things he told me that the 30%  figure I had heard from vendors was accurate. He is in the paper industry in China– he supplies the companies that make corrugated cartons – and told me that mills are carrying a lot of inventory nowadays. He added that some of China’s largest paper mills are closing factories because of the reduced demand for corrugate from both inside and outside of China.  When I told him that China’s growth rate this year is forecast for 9 % he said that much of that will be due to a busy first two quarters.  Since the summer business has fallen off considerably and he said he would not be surprised if China’s growth rate then is only 4-5%. Nat  has been living and doing business in China for 15 years and he seemed genuinely concerned about the situation in China– growing inflation and shrinking exports.   

One other thing I noticed at the fair this time is that there were many more mainland buyers than usual. I saw quite a few of them. This is testimony to the increasing consumer demand coming from within China.

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