Monday, August 1, 2011

Georgia Company Offsetting the Trade Imbalance With China, One Pair of Chopsticks at a Time

In a rather curious bit of role-reversal, a Georgia company is exploiting a shortage of wood in China and abundant resources in southern Georgia to export chopsticks to Asia.

“Right now we are making about two million pairs of chopsticks per day but we are increasing," says Jae Lee, president of Georgia Chopsticks. "End of this month, we’ll have seven machines coming in, so it’ll increase to like four million per day. End of this year, we’ll produce 10 million per day.”

Lee, a Korean-American, says the global market for chopsticks is huge because about one-third of the world’s population uses them. Japan alone goes through about 23 billion pairs of the disposable utensils each year.

Most chopsticks are made in China, where several hundred manufacturers turn out 63 billion pairs annually. But they are running short of wood.

Wood is something the U.S. town of Americus - where Georgia Chopsticks is located - has plenty of.

“Rural Georgia and the cities of rural Georgia, they’re blessed with tons of natural resources," says David Garriga, who heads the local economic development council. "The Pacific Rim, especially areas of China and Japan, they’ve run out of wood, but we have an abundance of it.”
The sweet gum and poplars that are abundant throughout southern Georgia are ideal for the production of chopsticks. The straight, pliable and lightly colored wood doesn't require bleach or chemicals to modify their colors.

Every pair of chopsticks made at Lee's Cochran, GA based company is exported to Japan, China or Korea where they are sold in supermarkets. Sumter County Chamber of Commerce head David Garriga said that he has been contacted by other businesses from the Pacific Rim interested in doing business in and around Americus, GA. The most recently available figures list the unemployment rate in Sumter county in the neighborhood of 12.5% (contrasted with Georgia's 9.7%).

In recent years, there has been something of a trend where businesses from China and elsewhere in the Pacific Rim have been looking to do business in the Southeastern USA. While labor costs are higher than in China, this is offset by lower costs for the property, utilities and certain tax credits that Chinese entrepreneurs are taking advantage of. Industrial real estate in the USA can be fetch not even 25% the costs in China while maintaining a presence in the USA also helps them respond more rapidly to any number of supply-chain issues.

Korean model in cheongsam
While exporting chopsticks to the People's Republic of China is somewhat ironic and good news for the people of Sumter county, Ga, I feel that the trade imbalance with China hasn't truly been adressed until the United States begins exporting cheongsams to mainland China.

1 comment:

  1. It was strange to see, driving down roads and streets, trees propped up with trunks of four other trees. I was told that the trees were transplanted from tree farms. No big deal, but they tend to use a smaller root ball then we do over here even for saplings. Larger trees will have the root ball of a typical sapling transplant over here.