Tough safety, trade rules hit exports hard, companies say
The outlook for the nation's exports of fireworks and firecrackers looks dim in 2017, as manufacturers and traders in the world's largest exporter face tighter safety and trade regulations for the sometimes dangerous products.
The industry was once one of the fastest-growing sectors in China, buoyed by vast domestic demand for traditional use during the Spring Festival as well as weddings. In the global market, the sector was dominant for years.
But industry participants say the glory days are over, and they cite tougher regulations on the supply and demand sides, as well as at customs.
"In recent years, I feel the business has gotten more and more tough," said a trader at Liuyang Dolphin Fireworks Trading, who would only give her surname as Huang.
Huang said her company used to export fireworks and firecrackers as well as other products from Liuyang, in Central China's Hunan Province, to many countries, including the U.S. and India. Liuyang is often referred to as the world's fireworks factory, with hundreds of manufacturers in the area.
"Business was simple but good. We just took orders from agents and sent the products on time. That was enough," Huang told the Global Times.
"And there were plenty of orders," she added.
Now Huang has to try every sales channel, such as opening an online wholesale store and placing online advertising.
"The goal is for more customers to see you," she said, "but there are not many new orders, except for repeat orders from some regular customers."
An employee at another Liuyang-based manufacturer, Flying Eagle Fireworks, said the company has faced tough times in the domestic and export markets in recent years.
"During holidays it's a little better, but still not comparable to what it used to be," the employee, who requested anonymity because of company policy, told the Global Times.
Exports of fireworks and firecrackers from China sank to .78 million in September 2016 from a peak of 1.27 million in October 2013, according to data compiled by the trade statistics provider tradingeconomics.com.
Huang and the employee at Flying Eagle Fireworks cited tougher rules in China for the drop in exports.
"The law is very strict on exports of fireworks, and it's getting harder and harder to pass customs inspections," Huang said. On top of that, there are different standards for many foreign markets, according to Huang.
At the production phase, regulations are getting stricter as well, according to the employee at Flying Eagle Fireworks. "There have been a lot of safety inspections, especially this year," the person said.
Following fatal incidents at fireworks factories, the State Administration of Work Safety launched a three-day inspection tour in East China's Jiangxi Province, Anhui Province as well as Hunan Province and vowed to increase enforcement and punishment for wrongdoing.
The General Administration of Customs has also cracked down on fireworks smuggling cases.
Adding to that are tougher regulations on Chinese products in foreign markets, according to Huang. She said her company used to sell to some U.S. retailers directly, but now it needs an agent to help with the process.