US masks sold to China even as crisis hit home
Exports shot up in January, February amid looming shortages
“This is going to have to be looked at to figure out how we allowed a U.S. company ... to feed the globe but not their home country.”
Jared Moskowitz Florida’s emergency management director
U.S. exports of surgical masks, ventilators and other personal protective gear to China skyrocketed in January and February, when the coronavirus was exploding in the country where it began and as U.S. intelligence agencies warned it would soon spread.
American companies sold more than $17.5 million worth of face masks, more than $13.6 million in surgical garments and more than $27.2 million in ventilators to China during the first two months of the year, far exceeding that of any other similar period in the past decade, according to the most recent foreign trade data available from the U.S. Census Bureau.
USA TODAY’s analysis of the trade numbers comes as medical professionals on the front lines of the nationwide crisis say they are being forced to reuse or go without personal protective equipment like surgical masks and face shields to account for a shortage. Some states also are scrambling to find ventilators to prepare for a crush of patients expected to need them.
The White House and congressional intelligence agencies were briefed on the scope and threat of the coronavirus in January and February, but President Donald Trump has not stopped exports of key medical equipment – a move taken by at least 54 other countries so far.
The data show how U.S. manufacturers stepped up production and cleared out inventory to supply protective medical equipment to China for weeks, even as the threat of the coronavirus became clear. The CDC reported its first case in the United States on
Jan. 20. Within the next two weeks, the World Health Organization and the U.S. Department of Health and Human Services had declared the disease a public health emergency.
“Clearly there was a surge in demand going on in China, and fundamentally this was a free market” decision, said Michelle Connolly, a Duke University economist. “What was in the U.S. was clearly going out, and specifically to China.”
The U.S. exported more than $1.7 million worth of surgical masks to China in January alone – more than double the previous January. In February, shipments surged to $15.8 million, the data show.
Jess Wang, co-founder of LuggEasy, a company that provides shipping services to Chinese residents in the U.S., confirmed the surge of masks exports in February. His company exported 14,000 to 15,000 pounds of masks from the U.S. to China in early 2020 alone.
At a retail price of roughly 50 cents a mask – which is likely higher than what wholesale customers would have paid – that meant more than 31.6 million surgical masks were shipped to China during the second month of the year, based on the trade data.
Taken together, the numbers add up to well over the 28.5 million face masks that mayors of nearly 200 U.S. cities told a trade organization they need to combat the coronavirus outbreak.
Vital ventilators also were sent
Ventilators, too, saw a spike. The U.S. exported $11.4 million worth of the breathing machines to China in the first two month of last year compared with $27.2 million in the first two months of this year, just weeks before states and hospitals started begging the federal government to send them more.
The price of ventilators vary from about $20,000 to $50,000 depending on the model, meaning the U.S. sent anywhere from 540 to 1,360 of them to China in January and February alone.
The U.S. Department of State also donated 17.8 tons of medical equipment to China in February. The mass donation included “masks, gowns, gauze, respirators, and other vital materials.”
The Census Bureau collects the data as a dollar value representing the product’s sale price. The total exports of these items could be greater, because the Census data does not capture small, private shipments that family members may have sent to China, or small packages that are exempt from certain filing requirements.
The White House did not immediately respond to a request for comment.
Health care professionals across the nation have said on social media and in news reports that they fear for their lives because they are being forced to ration disposable protective equipment for the entire week.
Private citizens are sewing masks themselves to donate to local hospitals as a makeshift solution so workers don’t have to tie bandanas around their faces. On Wednesday, a New Jersey man was the first emergency room doctor to die from the coronavirus since the outbreak. A nurse in Houston is also fighting the infection.
Exports of other protective garments, like surgical suits, skyrocketed, too. The U.S. shipped more than $271,000 worth of such supplies to China in January – nine times more than the previous January, the data show. In February, those shipments reached $13.4 million.
Ordering with cash in hand
Jared Moskowitz, Florida’s emergency management director, said his team started placing orders for respirators, masks, gowns and other supplies from private vendors more than a month ago but received only about 10% of what it ordered as of Thursday.
“I’m now hearing from distributors that foreign governments are showing up with cash at these factories and bumping everybody else down the line who had orders pending,” Moskowitz told USA TODAY, referencing conversations with brokers who serve as supply chain middlemen.
“This is going to have to be looked at to figure out how we allowed a U.S. company, the maker of perhaps the most important pieces of personal protective equipment, to feed the globe but not their home country,” Moskowitz said.
Moskowitz is not alone. The mayors of 192 cities across the country said in a survey released Friday that they do not have sufficient face masks for their first responders and medical personnel, and 186 cities said they faced a shortage of other personal protective equipment.
The survey said the cities need 28.5 million face masks, 24.4 million other types of personal protective equipment and 139,000 ventilators. The respondents did not include mayors of some of the nation’s largest cities, like New York and Chicago.
On Wednesday, Trump said the Strategic National Stockpile – a collection of vaccines and various medical supplies kept for emergencies – is almost out of personal protective equipment.
“We’re giving massive amounts of medical equipment and supplies to the 50 states,” Trump said Wednesday. “We also are holding back quite a bit,” he said, referring to ventilators that are being saved to meet peak demand.
“We will fairly soon be at a point where we have far more than we can use, even after we stockpile for some future catastrophe, which we hope doesn’t happen,” Trump said. “We’re going to be distributing to countries around the world. We’ll go to Italy, we’ll go to France, we’ll go to Spain.”
Vice President Mike Pence said Wednesday that the U.S. has distributed across the country “more than 11.6 million N95 masks, more than 8,100 ventilators around the nation, and millions of face shields, surgical masks and gloves.”
Tariffs on imports continued
In addition to allowing domestic firms to export lifesaving equipment elsewhere, the Trump administration continued placing tariffs on Chinese imports of many medical products into the U.S. even as the coronavirus reached our shores, said Chad Bown, a senior researcher at the Peterson Institute for International Economics.
The Trump administration announced on March 10 and March 12 that it would relax those tariffs. Bown called the move an acknowledgement that the administration’s trade policies were endangering public health. By the time they were relaxed, he said, tariffs already affected “nearly $5 billion of U.S. imports of medical goods from China, about 26% of all medical goods imported from all countries.”
A week later, Trump issued an executive order invoking the Defense Production Act that gives the federal government the power to force companies to produce medical equipment and fulfill needs related to national defense before any other contracts.
The language in the order also allows the administration to control distribution in civilian markets of “personal protective equipment and ventilators.” It’s not clear what the president will do with this authority.
Economists are now warning that countries are using protectionist trade policies such as export bans and tariffs in an effort to keep medical supplies in their countries, and that these could backfire for hospitals and health professionals who need the supplies.
A team at the University of St. Gallen in Switzerland said in a study March 23 that any tariffs on items will increase the prices hospitals and health professionals pay for such products. The team recommended that governments reassess their restrictions to meet the social challenge of COVID-19.
Bown generally supports free trade as an economic policy, but he also said it will benefit the public health response. There is too much uncertainty, he said, about which parts of the world will be hit hard by the coronavirus to cut off any areas of the world from production.
“What the pandemic has revealed to the world is that nowhere is safe,” Bown said. “Keeping open to international trade right now, in a time of pandemic, gives you many, many more options about where you might be able to source this kind of material from.”
USA TODAY used the latest trade data published by the U.S. Census Bureau for the analysis and looked at each commodity’s trade value based on its Harmonized System Code, known as HS code. The HS codes for personal protective equipment and ventilators are from a reference document for COVID-19 medical supplies published by the World Customs Organization.