Judging from the 2019 trade data released in February, the U.S. plastics industry exports and imports fell 3.0% and 5.0%, respectively, from 2018. From the total $64.8 billion exports in 2018, exports fell to $62.9 billion last year. Imports decreased from $64.3 billion to $61.3 billion over the same period.
By Perc Pineda, PhD
PLASTICS Chief Economist
Judging from the 2019 trade data released in February, the U.S. plastics industry exports and imports fell 3.0% and 5.0%, respectively, from 2018. From the total $64.8 billion exports in 2018, exports fell to $62.9 billion last year. Imports decreased from $64.3 billion to $61.3 billion over the same period.
While trade disputes between countries continued throughout 2019—Japan’s export restrictions for chemicals and materials needed by South Korea’s electronic industry, the European Union’s trade dispute with 26 World Trade Organization (WTO) member countries, to name a few—the tariffs and trade spat between the two largest economies of the world, U.S. and China, took center stage affecting the global manufacturing supply chain.
Although the U.S. has a persistent merchandise trade deficit going back 45 years, the plastics industry has been enjoying a trade surplus. The largest trade surplus in plastics trade in recent years was in 2011 totaling $16.5 billion.
Revisions to the trade data are expected—annual revisions are usually issued in June. Regardless if there will be changes and in what magnitude, last year’s trade numbers were the result of a confluence of three factors—trade uncertainty, weaker manufacturing activity, and strong U.S. dollar. These factors weighed on what was already a year of moderate economic growth. While the trade numbers were lower last year, the trade surplus based on the current, unrevised, trade numbers more than tripled from $0.5 billion in 2018 to $1.6 billion in 2019. The increase in the trade surplus would have been more meaningful if it was due mainly to U.S. exports growing faster than imports.
What’s ahead for plastics industry trade? With Canada ratifying USMCA, the U.S. will continue free trade with its largest trading partners in plastics – Canada and Mexico. Global economic output has slowed due to the coronavirus pandemic spreading across borders. China, the third-largest U.S. plastics export market grappled with coronavirus since January. Other regions, such as Europe, and countries are currently dealing with the pandemic. While coronavirus shocks on the economy are transitory, it will have residual effects affecting the manufacturing supply chain. It is expected that economic growth globally will be lower in 2020 than in 2019 and that will also be the case in the global plastics trade.
Look out for a more detailed analysis of plastics trade in the 2020 Global Trends Report at this year’s Global Plastics Summit in Dallas, TX on October 21~23, 2020. The current edition of the report can be accessed here.
