China factories grapple with soaring prices as pollution crackdown bites

Chinese exporters at the country’s biggest trade fair are more optimistic about global demand now than six months ago but Beijing’s crackdown on pollution is ramping up costs and product prices, hurting smaller factories and foreign buyers. At the Canton Fair where some 25 000 manufacturers are showcasing products from industrial engines to egg-cracking machines, the mood is sanguine. The world’s second-largest economy has defied expectations for a slowdown this year and import and export growth in September suggests factory activity remains in high gear.