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Trade war: China takes aim at U.S. plastics industry

  • Categories:Industry news
  • Author:
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  • Time of issue:2018-12-18 11:45
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(Summary description)American plastics professionals often lament that many outsiders are unaware of the impact of plastics on daily life...

Trade war: China takes aim at U.S. plastics industry

(Summary description)American plastics professionals often lament that many outsiders are unaware of the impact of plastics on daily life...

  • Categories:Industry news
  • Author:
  • Origin:
  • Time of issue:2018-12-18 11:45
  • Views:
Information

American plastics professionals often lament that many outsiders are unaware of the impact of plastics on daily life.

 

Based on the events that have occurred in the past two weeks, we can say that China, the most populous country on earth, does indeed know the US plastic market very well. Executives of US plastic companies may now think that being ignored is not so bad.

On April 4, China imposed tariffs on 106 U.S. commodities, in response to the second round of tariffs imposed by the United States against China. Some plastic market observers are surprised that more than 40 of these commodities are related to the plastics industry.

Chinese officials have targeted plastic materials, from polyvinyl chloride and polyethylene to engineering resins polycarbonate and nylon, and even cover high-end specialty resins such as polysulfone.

In other aspects related to plastics, the tax list proposed by the United States covers a long list of industrial products, including molds, injection molding machines, extruders, blow molding machines and thermoforming equipment.

Based on the USD value in 2017, plastics ranked fourth in the Chinese tariff market, second only to airplanes, soybeans and automobiles.

Market analyst paul bjacek said: "It seems that China basically chooses the polymer category, and the value of the trade deficit (not necessarily the volume) is the highest in the United States. This means that high-value polymers cannot be avoided. The impact of tariffs. In this way, engineering polymers have a higher trade balance value than certain general-purpose plastics. This may indicate that these tariffs are not intended to disrupt shale gas-related exports ... "Shale gas began To play a role, this raw material has led to a large-scale expansion of pe resins in the United States (mainly on the Gulf Coast). Most of these new materials are expected to be exported, of which China is regarded as a major destination. Statistics show that the United States exported more than 500 million pounds of pe to China in 2017 and is expected to continue to grow in 2018 and beyond.

The quantity of PVC (approximately 700 million pounds) exported from the US to China is similar to the quantity of PE, which is equivalent to about 40% of all PVC imports in China.

Since the domestic production of optical media products such as CDs and DVDs has declined, China has also become an important market for US PC resin manufacturers. The PC output currently exported by the United States accounts for about 40% of the total domestic PC output. paul blanchard, a market analyst at ihs markit in Houston, said: "The result is that reduced U.S. exports may put some pressure on China. China needs to find alternative suppliers of pc resin and nylon resin."

In terms of nylon 6/6, he added: "Northeast Asia seems to have the ability to replace it. However, if dinitrile raw materials are eventually included in China's tariff list, this will complicate the situation of nylon 6/6."

Robert eller associate (robert eller associates) president robert eller said that the proposed Chinese tariffs will have little impact on resin suppliers and companies in the US and Europe that have established operations in China or other Asian countries.

But eller added that companies that have resin and elastomer businesses in the United States could be harmed if they cannot find a market in non-China regions.

He said: "There may also be transactions between companies as an emergency measure to avoid tax problems." According to data from the American Chemical Commission (acc), China is one of the most important trading partners of the US chemical industry. acc chairman cal dooley said that acc is particularly concerned about 40% of the chemicals in China's new tariff distribution products, including polyethylene, polyvinyl chloride, polycarbonate, acrylate and so on.

He added: "The nearly $ 185 billion in new chemical plants, expansions and restarted facilities are all based on current tariff plans, and market changes caused by tariff increases may prompt investors to start business in other regions."

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