Rising Costs in China Seep Into U.S. Market

Still, he said, the Chinese suppliers -- not importers, retailers or U.S. consumers -- have so far borne most of the burden of increasing costs.

"We won't pay them until we receive products in the U.S.," Yao said. "It takes two to three months for shipping. During those months, their rate falls day by day" -- because of the weakening dollar -- "although we pay the same price. We've had lots of complaints about that."

As manufacturing costs in China rise, the pace at which companies are shifting operations to Southeast Asian countries is accelerating. But Ting Lu, an economist with Merrill Lynch, said he thinks that tactic will keep costs in check only for the short term. "After you move a few there, you're going to push up the labor costs there anyway," he said.

Mei Xinyu, a researcher in international trade at the Chinese Academy of Social Sciences, said the impact of the increased costs of producing goods in China, in theory, should not have such a big impact on consumer prices. Mei said the real problem is the huge markups by U.S. importers and retailers.

"The difference between their sales price and the factories' cost is more than dozens of times, even hundreds of times higher. Therefore, even if Chinese factories double their prices, it shouldn't matter," Mei said.

He said the loss due to increasing costs in China should be absorbed by U.S. importers and retailers rather than Chinese companies or U.S. customers. "I think it be a bit more fair in terms of the allocation of the rewards of world trade."

Researchers Crissie Ding and Wu Meng contributed to this report.