The China Trade

Once the uncontested king of the porcelain trade, China is diligently working to rediscover its artistic genius.

Mildred Mottahedeh, one of the foremost international authorities on Chinese export porcelain, has been working in conjunction with the Chinese government to help rebuild the porcelain industry, which declined during the years of war and internal strife since the turn of the century.

A great advocate of Sino-American cultural relations, Mrs. Mottahedeh has already made several trips to China to assist the Chinese in modernizing their porcelain production methods and reestablishing standards for quality of design. At 74, Mrs. Mottahedeh is respected by the Chinese as a woman of ''high years'' as well as for her expertise. She says they have told her: ''We want people with gray hair who have experience.''

Mrs. Mottahedeh is currently working with a factory outside of Peking which, like most other Chinese potteries, recently made the switch from the centuries-old ''dragon kilns,'' which burned wood, to firing the chinaware with methane gas. The transition has not been easy. So far the Chinese have had only limited success, with a 51 percent discard rate.

The Chinese are also working to meet Western standards in mixing glazes consistently in order to produce subsequent sets of china with exactly the same colors.

While the Chinese potters struggle with the new technology at home, the Chinese government is sending business people abroad to be trained as dealers and to become acquainted with Western tastes in chinaware.

Although the Chinese porcelain produced in the last 40 or 50 years has been lacking in design quality, Mrs. Mottahedeh is encouraged by the promise of the young Chinese students graduating from art schools.

She is not only interested in reviving the best of China's past, but would like to foster a new genre of Chinese design using the talents of the young modern artists.

Because of government support of systematic archaeological excavations, vast quantities of artifacts are being discovered each year in China. In the past most of the Chinese treasures were divided among the three major national art museums, in Peking, Shanghai, and Guangzhou (formerly Kwangchow). Today the Chinese are sifting through their newly recovered art objects to assemble collections for local museums throughout the country.

''The Chinese are beginning to discern between good and bad taste. They are learning the difference between quality design and hack work without soul,'' says Mrs. Mottahedeh, who is advising the Chinese in the process of selection.