How Would a Trade War with China Impact Lab Supply Pricing?

How Would a Trade War with China Impact Lab Supply Pricing?

The answer to this question depends on three key parameters:

  1. Would the Chinese retaliate by putting stiff tariffs on lab supplies? (Will this category of products be big enough to hit their “radar screen?)
  2. How many of the lab supplies offered for sale in the U.S. source from China?
  3. How much of what you buy is sourced from China?


Do the Chinese export a lot of lab supplies and equipment?

Total U.S. imports from China in 2017 - $506 billion

Of this $506 billion, here are some of the key commodity codes from which lab supplies, chemicals and equipment are included:

Inorganic chemicals - $41.55 million

Organic chemicals - $806.75 million

Miscellaneous chemical products - $1.17 billion (much of this category is rare earth elements)

Optical, photographic, precision, medical or surgical instruments - $208.34 million

Glass and glassware (not exclusively labware) - $2.91 billion

Plastics - $398.04 million

Click here for a more detailed summary by product category.

According to Business Wire, the global value of General Laboratory and Equipment is estimated to be $9.4 billion by 2020.  It was valued at $5.4 billion in 2015.  The U.S. share of this market is estimated at between 32% and 40% by various sources.  2018 U.S. estimate would range from $2.05 to $2.56 billion.

As a percentage of the total market, China is a big player both as a supplier and a consumer.  If/when the trade war hits this sector; the risk is high for both importers and exporters.

For a more detailed market analysis, click here.


How many of the lab supplies, chemicals and equipment offered for sale in the U.S. source from China?

Estimating this number is the best we can do.  This is because many of the products you purchase with brand names that you buy are made in China.  As an example, the VWR Private Label -86 Ultra-Low Freezer is made by the largest refrigeration company in the world, Haier Refrigeration, one of a slew of Chinese refrigeration companies.  In fact, according to Reuters, China exported 92.4 million units in 2017[1]!  The lab market represents a small segment of this number.  But here is a sampling of the brand names that make up this total:

Aux, Bosch, Changhong, Chigo, Daikin, Electrolux, Galanz, Gree, Haier, HF-Sanyo, Hisense, Kelon, Konka, LeTV, LG Panda, Littleswan, MeiLing, Midea, Mitsubishi, New-fly, Panasonic, Ronshen, Samsung, Sanyo, Sharp, Siemens, Skyworth, Sony, TCL, Tongfang, XiaoYa, Xingxing, Xinle

And this is just one market – refrigeration!

Distributors in the U.S. closely guard the identity of their private label suppliers.  In many cases the only way to learn where the product was made is to ask for the “COO” data which is required for export (COO = country of origin.)  Even this doesn’t tell the full story as many pieces of equipment are made using components that source from China but don’t comprise 51% of the total content and are classified as U.S. origin.

In the chemicals sector, China is a huge player.  Many chemicals that are used in the lab are sourced from China.  Many of the specialty chemicals can only be sourced from China.

Summing it up, the lab supplies, chemicals and equipment suppliers in the U.S. buy and sell a lot to and from China.  An increase in tariffs on these products will impact a wide swath of items used in the lab as well as the bottom lines of a lot of U.S. suppliers and distributors.


How much of what YOU buy is sourced in China?

Of course, this depends on you.  Here are some ways to estimate what would be impacted:

  • Is the item a commodity consumable like 15- or 50mL centrifuge tubes, serological pipets or transfer pipets?
  • Is it a private label product from one of the big distributors?
  • Is the product you are buying far cheaper than a similar item coming from one of the big brand names (e.g., Thermo, Corning, Agilent or BD?)

And even if you ONLY buy from U.S. manufacturers, keep in mind that a lot of the raw materials such as steel, aluminum and chemicals will be impacted by increased tariffs.


[1] I visited mainland China in 1985.  Refrigeration was considered a luxury then and very few private citizens owned a refrigerator.



Our industry has grown accustomed to pricing stability.  Prices generally increase on January 1st of each year and have typically mirrored the consumer price index rate of increase.  The primary reason for this long period of stability has been the pressure put on U.S. manufacturers from products sourced from low labor cost countries:  India, Malaysia, Sri Lanka and the elephant in the room:  China.

Those of us who have lived long enough remember what happened to prices after the 1974 oil crisis and the hyper inflation of the early 1980’s when prices on items were increasing on a weekly basis.  We know how disruptive this can be.  Your budget and your relationship with you supplier, your supply chain and even your ability to obtain the supplies necessary to do lab testing are all impacted!

Our industry is a global one and our suppliers are global also.  A trade war with China will be hugely disruptive in the short run and could set off a chain of inflationary price increase such as when the U.S. steel industry raised their prices to match their foreign competitors after tariffs were imposed.

Let’s all hope this doesn’t happen.  We’ll see.


Trade War Timeline


January 22nd, 2018 - United States announces tariffs on solar cells and washing machines from numerous countries.

February 4th, 2018 - China retaliates with threat of taxing 1.1 billion US sorghum industry imports.

March 2nd, 2018 - US imposes aluminum and steel tariffs (10% and 25% respectively).

March 20th, 2018 - United States threatens $60 billion of tariffs, targeting Chinese goods.

March 20th, 2018 - China warns of "severe repercussions."

March, 22nd, 2018 - US announces that it is in the process of preparing a list of tariffs, filing a case with the WTO, as well as restricting Chinese investment opportunities.  This is in response to China's lack of protection for US copyrights, as well as their technology transfer requirements.

March 22nd, 2017 - US announces that Brazil, South Korea, and others will be excluded from US steel tariffs.

March 22nd, 2018 - China issue official statement claiming that "China would fight to the end to defend its own legitimate interests with all necessary measures."

March, 23rd, 2018 - China introduces plan to increase tariffs on US aluminum and steel imports.

March, 23rd, 2018 - United States requests consultation with China at the World Trade Organization, to settle intellectual property protection disputes.

April 2nd, 2018 - China announces tariffs targeting US agricultural goods, amounting to another 3 billion.

April 3rd, 2018 - United States retaliates again with an announcement tariffs targeting "high-tech" industrial products from China, estimating another 50 billion.

April 4th, 2018 - China announces 106 more tariffs, targeting US soybean, automotive, aircraft and chemical industries.  They also file an official  WTO complaint, regarding US steel tariffs.

April 5th, 2018 - US again double down, slating another 100 billion in tariffs.  United States claims it will review more Chinese products, to put on the list.

April 10th, 2018 - Chinese president Xi offers to open more market sectors to US companies.   This would include automotive and financial services.

April 16th, 2018 - US bans Chinese ZTE Corporation from buying and US technology, and announces that it will impose fines on the company, for continuing business with either Iran or North Korea.

April 16th, 2018 - United States also mentions investigating China's Hayuwei Technologies Co. regarding its violations of trade sanctions with Iran.

April 17th, 2018 - China brings back the sorghum threat, threatening to collect anti-dumping duty deposits worth 180% on sorghum from the United States.

April 22, 2018 - Offer to launch talks between United States and China.

April 27th, 2018 - US issues "Special 301" annual report on intellectual property, claiming that China is a "significant concern."

April 27th, 2018 - China objects to United States 301 report, claiming that the US is misrespecting the facts.

May 3rd, 2018 - Negotiations begin between US and China in Beijing.

May 3rd, 2018 - China offers to remove huge import tax on US sorghum.

May 14th, 2018 - China agrees to purchase US agriculture and energy products.

May 17th, 2018 - EU leaders propose having discussions with the US, in an attempt to remove industrial tariffs, to prevent a trade war.

May 19th - United States and China put trade war on hold.  China drops its anti-dumping probe into US sorghum import, due to rising financial risks.

May 22nd, 2018 - World Trade organization says that numerous countries, threaten retaliation for US steel and aluminum tariffs, most notably, Russia, Japan and Turkey.

May 23rd, 2018 - WTO filings show that India launched complaint against the United States, challenging steel and aluminum tariffs.

May 29th, 2018 - US white house claims that it will indeed follow through with its 25% tariff on 50 billion worth of Chinese goods.

May 31st, 2018 - Canada threatens to retaliate on the United States with 16.6B (Canadian), unless the US lists its own new measures.

June 1st, 2018 - US introduces import quotas for steel and aluminum from certain countries.  This would be instead of the planned tariffs.  Countries include Argentina, Brazil and South Korea.

June 5th, 2018 - Mexico imposes immediate tariffs on numerous US industries in retaliation for Steel tariffs.

June 8th, 2018 - China imposes temporary anti-dumping measures on Brazilian broiler chicken industry.

June 15th, 2018 - US trade representative's office revises Chinese tariff list, targeting $34B worth of goods, but removes proposed tariffs on televisions, air conditioning parts, and SOME aluminum alloys.

June 16th, 2018 - China announces additional tariffs on 659 US goods valued at $50 billion.

June 18th, 2018 - United States president threatens 10% tariff on $200B worth of Chinese goods.

June 21st, 2018 - India levies import duties on 29 US imports, primarily agricultural goods.

June 22nd, 2018 -United States threatens EU with proposed 20+% tariffs on all US imported vehicles, assembled in the European Union. (Note: EU only imposes a 10% tax on imported cars from the US).

June 26th, 2018 - China claims it will remove animal feed tariffs from select Asian countries to lessen the demand for US agricultural goods as the trade dispute with the US continues to escalate.

June 26th, 2018 - United States claims it is completing study, regarding increasing import tariffs on vehicles from the EU.

June 27th, 2018 - US President claims US will use US National Security Review Committee to slow China's acquisitions of United States organizations with "sensitive technologies,” taking a slightly softer line on investment restrictions.