U.S.-China Trade War Affecting Pennsylvania Hardwoods Industry
A proposed trade war between the United States and China is putting a threat on the Pennsylvania hardwoods industry. The State Auditor General claims 45,000 Pennsylvania jobs could be lost.
October 1 is the date when China is threatening a 25% tariff rate on imported U.S. products, including hardwoods. This is in response to President Trump threatening to raise the tariff rate on $200 billion worth of Chinese products from 10% to 25%.
Local hardwood companies are worried. China is an important customer at Penn-Sylvan hardwoods in Crawford County. 100% of the hardwood stacked and bundled at its Centerville facility goes to China. The wood is manufactured to Chinese specifications.
Jay Reese, Vice President and Sales Manager, says the Pennsylvania hardwoods industry was saved by China in 2008-2009 when the U.S. economy plummeted. He has loyal customers in China. He also has 75 employees who make good family sustaining wages. All he can do is wait and see what happens.
"I think everyone's worried about how long it will go. We're a strong company. We've never had to lay people off in any kind of a downturn. But if it prolongs a year from now, it could be interesting,” Reese said.
Steve Jones is President of Sales at Ron Jones Hardwood. The company has facilities in Union City and Franklin. He sits on the board of several hardwood federations. 70% of his company's product goes to China. Jones does not know when the U.S.-China trade war is going to blow over.
"Somebody asked me 'How are you figuring out this business right now?' I said it's kind of like putting a puzzle together in the dark. You really don't know what's going to happen. Trump could change his mind tomorrow, the next day, in a month from now. The Chinese could change their mind,” Jones said.
Both Reese and Jones will be heading to Washington, D.C. next week to lobby members of Congress about trade and tariff issues.
Yeah, we're scared,” said Jones. “But we'll find a way to survive. We always do."