With all the uncertainty surrounding the current US trading relationship with China, it is a good time to review where we are with the proposed US and Chinese tariffs. The proposed US tariffs listed approximately 1,300 separate tariff lines which still have a long process of reviews and public hearings before the Office of US Trade and Representative will issue a final determination. If the entire list of the proposal were to pass, this would equate to approximately $50 billion of estimated trade value for the 2018 calendar year. Even though the proposed list includes some inorganic chemicals, organic chemicals and pharmaceutical products, ChemCeed’s entire product line selling into the US markets would be unaffected by these proposed tariffs, if they were passed as currently proposed.
In response, China released a list of 106 US products which could face a 25% tariff which includes a broad range of chemicals. The effective date for these tariffs are yet to be determined. These proposed tariffs from China may not affect ChemCeed US prices domestically but it could affect prices of feed stock and market prices for various products produced in the US and in China. There is a large amount of uncertainty regarding how possible tariffs might affect ChemCeed prices, but if the situation remains as is, price increases due to these proposed tariffs will play little to no factor in any upcoming price increases.