China's Candle Exports Face Dual Pressure from Trade Frictions; RCEP Emerges as New Opportunity for Breakthrough

**U.S. Tariffs: Limited Breathing Room Under Pressure**
Under current policies from the U.S. Trade Representative (USTR), Chinese-made candles (HS Code 34060000) still face an additional 25% tariff. Notably, in 2023, USTR granted tariff exemptions for specific **festive candle products**, providing crucial relief for some seasonal exporters. Industry analysts note that the exemption scope is limited and requires active application by companies, meaning overall cost pressures remain high.

**South American Anti-Dumping: Risks in Transit Trade**
Between 2022 and 2023, Brazil and Argentina successively launched anti-dumping investigations against Chinese candles, alleging low-price dumping harms their domestic industries. To avoid high punitive tariffs, some Chinese companies have turned to **transit processing through third countries like Thailand and Malaysia**. However, industry insiders warn that such practices face increasingly strict **origin verification** and may trigger new trade remedy investigations, posing significant long-term risks.

**RCEP Benefits: East Asian Markets Become Growth Engine**
With the deepening implementation of the Regional Comprehensive Economic Partnership (RCEP), a major tariff advantage emerged in 2024 for candles exported from China to Japan and South Korea – rates dropped progressively from the original 5%-8% **in phases down to zero**. This policy directly stimulated a surge in orders from Japan for major candle production bases in Shandong. As revealed by a leading enterprise in Linyi, Shandong: "Orders from Japan have **soared by 35%** year-on-year since the beginning of this year. Production lines are operating at full capacity. The RCEP tariff reductions are a key advantage for us to expand into the high-end market."

> **Director, Candle Sub-Council, China Chamber of Commerce for Import & Export of Light Industrial Products and Arts-Crafts**
> "The candle industry currently faces a complex situation of 'tightening in the West while easing in the East.' Companies need to establish multi-dimensional strategies: consolidate advantages in RCEP markets, explore product differentiation to counter anti-dumping, and utilize limited tariff exemption clauses effectively. Compliance is the lifeline of cross-border trade; any avoidance methods must be based on legality and compliance."

**Reporter's Observation**
Trade frictions are forcing China's candle industry to accelerate transformation. The era of relying solely on cost advantages is ending. Upgrading towards high value-added, eco-friendly materials, and cultural/creative products, while leveraging free trade agreements to restructure supply chains, will become core competitive advantages for navigating policy headwinds. With the rise of industrial chains in Southeast Asia and other regions, the global candle trade map may witness a new round of reshuffling.

Zhongya candle factory
whatsapp: +86//187//3296//0113
wechat: +86//156//9035//5727
Email: Betty@kangdecandle.com