The last years have been a wild ride but at BPF we have been able to keep costs low by searching alternative sources while always watching quality specifications. China has one of the sources for us in key items such as Mandarins with much success and others like Artichokes with less. So many production areas can say the same in many different industries. We are more connected globally than ever before.
For the last few years, as most know, China has supplied most of the world's economic growth (International Monetary Fund sources, WSJ, etc.).
The U.S. and the E.U. are expected to expand barely for years to come, while (we hope) China's economy to keep rising at this year's at 8% growth rate or better. Is this going to happen? WSJ's Gongloff raises some interesting quotes including: "The combination of soaring investment and dwindling returns was seen in Japan in its asset bubbles in the 1980s and in the "Asian Tigers" just before their crises in the late 1990s, he (Edward Chancellor at Boston asset-management firm GMO) says."
The impact to costs of Mandarins is pretty clear. Prices are going up. How much will depend on several factors which we will watch closely...
Stay tuned as China evolves into the engine of the recovery or the latest weak link in the evolving global economic scene.
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