Customers dine at a Chinese restaurant in Los Angeles. Photo: IC

The prolonged, US-initiated trade disputes with China have cast a shadow over US businesses, among them some 38,000 Chinese restaurants are suffering from inflated prices of materials and ingredients.

"We call it 'quarter pinch,' a 25-percent climb across the board bulging the face value of our daily necessities from soy sauce to decoration tiles," said Lily Zhao, a catering industry insider of Chinese descent in Baltimore, Maryland.

In an escalation of the trade disputes, Washington on May 10 increased additional tariffs on $200 billion worth of Chinese imports from 10 percent to 25 percent, and has threatened to raise tariffs on more.

Zhao planned in 2018 to install 14 kitchen cabinets for her own restaurant, but balked at the $5,000 proposed by the contractor who imported materials mainly from China. In June, she was told that the price had gone up by around $1,500.

To her knowledge, the trade disputes also augmented the costs of granite counter tops which came from China, and air conditioners whose spare parts were manufactured in China.

For each air conditioner, an essential purchase that must also be renewed regularly in every dining spot, one now has to pay an extra $1,000, she said.

Bitter taste

Samuel Wang owns two restaurants in Philadelphia, Pennsylvania's largest city. His establishments offer cuisine of Northwest China's Shaanxi Province.

Some 30 percent of the ingredients, sauces and beverages he and his chefs use every day are imported from China. No substitutes found in the US can give the same result. This was also why the ongoing trade disputes matter a lot to him.

"We Chinese restaurateurs are extremely sensitive to price rises, which often come as you have to choose from imported spices and ingredients for your kitchen," said Wang, who has been in the restaurant business since 2013.

"I have seen an overall price increase for the imported-from-China things that we use in our kitchen," said Wang.

Industry rules stipulate that with the materials and ingredients becoming more expensive, food and dish prices must go up as well, otherwise a business would not survive.

However, Wang chose to pay the extra costs himself. "I don't want to frighten my customers away. I have no choice but (to) bring it on later when a more suitable juncture comes up. This just tells how hard it is to maintain a food business here, especially a Chinese one right at this moment," he said.

"I hope that the trade war ends as soon as possible, which will be the greatest news for businesses and consumers. If it can't be contained, the catering industry and all other businesses will receive a further blow, and those who lose the most are the US consumers," he added.

Common destiny

Yang, who would not give his full name, is attached to his family business - a chain supermarket in the US featuring Chinese products, most of which were on the purchasing lists of nearby Chinese restaurants.

"Due to the tariff war, our wholesaler has told us most Chinese commodities are turning more expensive, but there will be only staggered increases, not hikes, like three to five percent a month within a period of six months. In the end, they will add up to around 25 percent," said Yang.

After years of working together, the wholesaler once again won Yang's heart by choosing staggered increases over a hike.

"This means that we share the burden. The wholesaler diverts some pressure to us, and retains some for himself. We share a common destiny," he said. 

The trade disputes could stretch on or end, and one should be prepared for either outcome. Acting with such a mindset, gradual increases would be a realistic option.

"There is no need to rush. If the war terminates, it will be easier to return to normal; if it stretches, it will not be hard for us to reach a new high," Yang said.

"We support peace"

In downtown Manhattan, New York, Arielle Haspel and her husband run a Chinese restaurant that has attracted locals around the neighborhood.

However, potential trouble still lurks in Haspel's mind - her building contractor recently came to show her the bills and try to sort out the payments. Some of the building materials were from China, and their prices had climbed.

Figuring that her business had just run for two months, Haspel was still unsure whether it would affect the costs and operation.

"We don't know yet whether the change of ingredient prices will affect our business," she said.

Asked how she would cope with the situation if the trade disputes lasted long enough to affect her business, Haspel remained silent for several seconds before giving her answer. "We support peace, and we support other countries and their businesses as well," she said.


Newspaper headline: Collateral damage