Almost lost among today's msnbc.com headlines and the Internet chatter about Whitney Houston's death and whether the New Jersey governor is justified in calling for the state's flags to be flown at half-staff in memorial was a link in the "Business" section that captured my attention and made me cheer.
A small business in Americus, Georgia, is manufacturing chopsticks and exporting them to China. How sweet is that?
On the site of a former auto parts plant, fast-growing soft hardwoods indigenous to this part of the country—poplar and sweet gum (glad to know they are useful for something besides depositing gum balls that clog up my mower)—are turned into chopsticks at the rate of four million sets each day. Reportedly, 99.7 percent of these are exported to customers in Asia.
The factory currently employs 108 people. Plans to expand into other product lines are on the board.
If more manufacturers could emulate this trend and find exportable products, perhaps we could finally do something to reduce the U.S. trade deficit with China. At $295.5 billion, the deficit now is the largest in history. According to census figures, U.S. exports to China in 2011 totaled $103.8 billion; imports from China totaled $399.3 million.
However, exports to China don't tell the whole story when it comes to U.S. exports. The Commerce Department recently reported that during 2011, exports of goods and services were up by 14.5 percent over 2010 to a record $2.1 trillion. Among the companies contributing to this total is McLanahan Corp., Hollidaysburg, Pa.
Michael McLanahan, the fifth generation of his family to run the business, said 2011 was its best year ever. One reason is the company's focus on exports.
"In the 1990s, as environmental regulation stiffened on the U.S. mining industry, McLanahan refocused the company to take advantage of export opportunities. Back then, about 10 percent of the company's product went overseas. Today it's about 70 percent.
"Mineral-rich Australia is a big customer, and McLanahan has benefited greatly from that country's high labor costs and weaker manufacturing base.
"We can build here and ship into Australia for cheaper than they can make it there," said McLanahan. He laments that mining in the United States has shrunk so much and with it, domestic sales opportunities. 'I knew that the future of our company depended on a robust export effort.'"
Recently "the manufacturer was busily filling orders from Iceland and Colombia, as well as actively building log washers for the timber industry and equipment for dairy farmers."
However, despite these increased exports, some see their significance and the sometimes purported manufacturing renaissance as being not all they could. Quoted in the sacbee.com article is Alan Tonelson, a research fellow at the U.S. Business and Industry Council, which represents smaller U.S. manufacturers that do not operate abroad.
"Tonelson points to a widening deficit in manufactured goods, noting that even as exports grow, ground is being lost to foreign competitors. A USBIC study released Feb. 7 found that Chinese exporters had captured 7.5 percent of American purchases of 108 different capital-intensive segments of U.S. high-tech manufacturing in 2010.
"'It is very difficult to see how the manufacturing sector could be excelling as it is losing market share in its own backyard,' said Tonelson, author of the book 'The Race to the Bottom.'"
Despite these valid concerns, increased exports—even of something as simple as chopsticks—are a positive trend that can only help our economic recovery.
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Canadian Metalworking / Canadian Fabricating & Welding
Canadian Metalworking/Canadian Fabricating & Welding is a trade publication that covers all aspects of the country's metalworking, fabricating & welding industries. We strive to bring you the latest news, products, and insights to keep our readers aware of the latest industry trends.