As of October 7, 2025, the United States has imposed a significant additional tariff of 25% on a wide range of goods from Mexico, including many products from the plastics industry. This measure, effective March 4, 2025, was implemented under the authority of the International Emergency Economic Powers Act (IEEPA). The stated justification for these tariffs is to address national security concerns related to illegal immigration and drug trafficking, as announced by the Trump administration. While a further 30% tariff was announced in July 2025, the prevailing additional rate for non-USMCA compliant goods remains 25%.
The trade relationship in the plastics industry between the U.S. and Mexico is governed by the United States-Mexico-Canada Agreement (USMCA). In 2024, the total trade in plastics and related articles (under HS Code 39) was substantial. U.S. imports of these goods from Mexico were valued at approximately $12.8 billion. Conversely, U.S. exports of plastics to Mexico in the same year reached around $21.74 billion, highlighting a deeply integrated cross-border supply chain for the industry.
This new tariff policy marks a significant departure from the free-trade principles of the USMCA, which succeeded the North American Free Trade Agreement (NAFTA). The previous framework focused on eliminating tariffs for goods meeting specific rules of origin. The current policy, however, utilizes tariffs as a tool to exert pressure on non-trade issues, such as national security and immigration. This shift has created a more unpredictable business environment, drawing criticism from industry groups like Mexico's Anipac, which has warned of disruptions to production networks and increased costs for materials.
Upstream Feedstock Production: Most basic petrochemicals and monomers from Mexico that do not qualify under USMCA are subject to the 25% additional tariff, although some energy products may have exemptions.
Midstream Polymer Production: An additional tariff of 25% is in effect for non-USMCA compliant commodity polymers (like polyethylene) and specialty engineering polymers.
Downstream Fabrication and Distribution: A 25% tariff is applied to non-USMCA compliant fabricated, molded, and packaged plastic articles, though many products may be exempt if a 'substantial transformation' occurs in Mexico.
The new 25% tariff is estimated to affect approximately $7.6 billion worth of U.S. plastics industry imports from Mexico, based on 2024 trade data. This impact is concentrated on goods that do not meet the stringent USMCA rules of origin. Companies unable to certify their products as USMCA-originating, either due to sourcing raw materials from outside North America or not meeting the required transformation criteria, will face significantly higher import costs, potentially disrupting established supply chains and increasing prices for U.S. consumers and businesses.
A significant portion of the plastics trade is exempt from the new tariffs, provided the products qualify as originating from Mexico under the USMCA's rules of origin. It is estimated that overall, 84% of Mexico-U.S. trade remains tariff-free. For primary plastics (headings 3901 to 3915), a key rule requires the originating polymer content to be at least 50% by weight. For fabricated plastic articles, exemption often requires a change in tariff classification, indicating substantial transformation within a USMCA country.
As of October 7, 2025, the United States, under the Trump administration, implemented new tariffs on the Canadian plastics industry. These tariffs, which are in excess of the United States-Mexico-Canada Agreement (USMCA), began with a 25% tariff on non-energy imports on March 4, 2025. This rate was subsequently increased to 35% on August 1, 2025, for goods not compliant with USMCA rules. The tariffs were enacted under the International Emergency Economic Powers Act (IEEPA) to address cited national security concerns.
Trade in plastics between the U.S. and Canada is governed by the United States-Mexico-Canada Agreement (USMCA), which aims to facilitate tariff-free commerce. In 2024, U.S. plastics exports to Canada were valued at approximately $7.3 billion, while Canadian plastics exports to the U.S. were about $14.9 billion. According to the United Nations COMTRADE database, U.S. imports of plastics from Canada amounted to $14.18 billion in 2024, highlighting the deeply integrated nature of the North American supply chain for this industry.
The 2025 tariffs represent a significant shift from the previous policy under the USMCA, which is designed to foster tariff-free trade. The new policy introduces substantial costs for Canadian exporters and U.S. importers by applying tariffs of up to 35% specifically on goods that are not compliant with the agreement's rules of origin. This targeted approach differs from the broad, duty-free access previously enjoyed. In response to the U.S. measures, Canada announced retaliatory tariffs, further escalating trade tensions.
Upstream Feedstock Production: Non-USMCA-compliant petroleum and natural gas-based feedstocks such as ethylene and propylene are subject to a 35% tariff.
Midstream Polymer Production: Commodity polymers like polyethylene and specialty engineering polymers from Canada face a 35% tariff if they do not meet USMCA origin rules.
Downstream Fabrication & Molding: Fabricated products from processes like injection molding are highly vulnerable to the 35% tariff due to a significant drop in USMCA compliance in 2025.
Packaging & Distribution: Plastic packaging materials, including items like bags and lids, are subject to the 35% tariff if they are not USMCA-compliant.
The new U.S. tariffs impact all Canadian plastic products that fail to qualify for preferential treatment under the USMCA's rules of origin. A 2025 report indicated that the USMCA compliance rate for U.S. imports of Canadian plastic products had fallen to just 39.5%, a sharp decline from 98.3% in 2024. This drop exposes a majority of the nearly $14.9 billion trade in this sector to the new 35% tariff. The impact spans the entire value chain, including upstream feedstocks, midstream polymers, and downstream fabricated goods like packaging.
Plastic products and materials originating from Canada that meet the stringent rules of origin stipulated by the USMCA are exempt from the new tariffs. These goods can continue to be traded duty-free between the two nations. This exemption is crucial for the highly integrated North American chemical sector, where the use of regional feedstocks typically ensures a high rate of compliance. The determination of eligibility often depends on complex 'tariff-shift' rules, which require that a product undergo significant transformation within a USMCA country to qualify as originating.
As of October 7, 2025, the United States has introduced significant new tariffs on the Chinese plastics industry, layering on top of existing Section 301 duties. A key measure is an additional 10% tariff on a wide range of Chinese imports, effective March 4, 2025. This was followed by a universal baseline tariff of 10% on nearly all U.S. imports, enacted on April 5, 2025. Additionally, some reports indicate a 20% 'China IEEPA fentanyl' duty has been imposed, citing national security concerns. The de minimis provision, allowing duty-free entry for shipments under $800, was also suspended for products from China as of May 2, 2025.
The U.S. trade relationship with China in the plastics industry is substantial. In 2024, the U.S. recorded a trade deficit in plastics with China of approximately $10.9 billion. During the same year, U.S. plastics exports to China were valued at around $7.3 billion. Based on 2024 data, an estimated $18.2 billion worth of plastics imports from China are potentially affected by the new tariffs. Data from the United Nations COMTRADE database corroborates this, showing U.S. exports of plastics to China at $7.45 billion in 2024. No specific free trade agreement governs this sector; trade is conducted under World Trade Organization rules, now heavily modified by unilateral tariffs.
The 2025 tariff policy represents a significant escalation compared to the previous framework, which was primarily composed of Section 301 tariffs ranging from 7.5% to 25% on specific product lists. The new approach introduces broader, more sweeping measures like the 10% universal baseline tariff and utilizes different legal justifications, including the International Emergency Economic Powers Act (IEEPA). A major change is the elimination of the de minimis exemption for China, which previously allowed shipments under $800 to enter duty-free. This combination of measures creates multiple new layers of tariffs, substantially increasing the total duty on many plastic products.
Petroleum‐based Feedstocks: Subject to up to 25% Section 301 tariffs, plus a new universal 10% baseline and an additional 10% tariff on Chinese goods as of 2025.
Natural Gas‐based Feedstocks: Key feedstocks like ethylene and propylene polymers faced 25% Section 301 tariffs and are now subject to the additional 2025 tariff layers.
Commodity Polymers: Resins like Polyethylene (PE), polypropylene (PP), and PVC now face cumulative duties from the original 25% Section 301 tariffs plus the new 10% baseline and 10% China-specific tariffs.
Specialty Engineering Polymers: In addition to existing 25% tariffs and new 2025 levies, these face a retaliatory 74.9% anti-dumping tariff from China on U.S. exports of polyformaldehyde (POM) copolymer.
Fabrication & Molding: Thousands of finished and semi-finished plastic articles now face cumulative duties from the original 25% Section 301 tariffs plus the new 2025 levies.
Packaging & Distribution: Plastic packaging materials face the original 25% Section 301 duties plus the new 2025 tariffs, with costs further impacted by the suspension of the de minimis provision.
Given the broad nature of the new tariffs, such as the universal baseline and the additional China-specific levy, it is estimated that nearly all $18.2 billion in plastic industry imports from China are impacted. The impact extends across the entire supply chain, from raw materials to finished goods. Furthermore, the suspension of the de minimis rule for China directly impacts the high volume of e-commerce and small-scale shipments that were previously not subject to duties.
Specific exemptions for the new 2025 tariffs have not been detailed. While the U.S. Trade Representative (USTR) has extended some pre-existing exclusions from the original Section 301 tariffs, these are limited in scope. For example, 164 of 429 expiring exclusions were extended through May 31, 2025. However, these extensions explicitly do not apply to the new layers of tariffs added in 2025, meaning very few, if any, plastic products are exempt from the new duties.
On April 2, 2025, the Trump administration announced new tariffs impacting the German plastics industry, introducing a universal baseline tariff of 10% on all goods imported into the U.S., effective April 5, 2025. Furthermore, higher 'reciprocal tariffs' were introduced for countries with which the U.S. has a significant trade deficit. For the European Union, including Germany, this additional surcharge was planned at 20%, with some reports mentioning a potential 50% tariff on EU imports. These reciprocal tariffs were implemented on August 7, 2025, through executive orders.
Prior to 2025, U.S.-Germany trade in plastics was primarily governed by the World Trade Organization's framework, which ensured low or 0% tariff rates on many industrial goods. In 2024, Germany's plastics exports to the United States were valued at approximately $3.74 billion. In 2023, Germany exported $10 billion in plastics to the U.S. and imported $8 billion from the U.S. For context, in 2022, the broader category of chemicals, plastics, rubber, and leather goods constituted 23.0% of U.S. imports from Germany, amounting to $33.7 billion.
The 2025 tariff policy marks a significant departure from the previous framework based on the World Trade Organization's principles, which generally featured low tariffs. The new policy established a broad-based 10% universal tariff on all imports, with additional substantial 'reciprocal' tariffs on major trading partners like the EU. This change represents a major shift toward a protectionist stance in U.S. trade policy. The administration's stated goals for these measures are to reduce the national trade deficit, encourage domestic manufacturing, and create what it terms as fairer competitive conditions for U.S. industries.
Petroleum‐based Feedstocks: A new baseline tariff of 10% has been added, plus a potential reciprocal tariff of 20% or higher.
Natural Gas‐based Feedstocks: A new baseline tariff of 10% has been added, plus a potential reciprocal tariff of 20% or higher.
Commodity Polymers: These products are now subject to the new 10% universal tariff and additional reciprocal tariffs.
Specialty Engineering Polymers: These materials are also subject to the new 10% universal tariff and additional reciprocal tariffs.
Fabrication & Molding: Finished and semi-finished fabricated plastic products now face the 10% baseline tariff plus any applicable reciprocal tariffs.
Packaging & Distribution: Packaging solutions and distributed resins are impacted by the newly imposed 10% universal tariff and additional reciprocal tariffs.
The new tariffs are estimated to affect the majority of Germany's $3.74 billion in plastics exports to the U.S. (based on 2024 data). The impact extends across the entire plastics value chain, from upstream feedstock production to midstream manufacturing of polymers like polyethylene (PE) and polypropylene (PP). Downstream fabricators and distributors are also heavily affected. The German machinery association, VDMA, has voiced significant concern, warning that the tariffs could pose an existential threat to some of its member companies.
While comprehensive lists of exempted products are detailed within the specific annexes of the implementing executive orders, certain strategic products have been granted exemptions. These categories reportedly include essential goods such as pharmaceuticals and semiconductors, along with humanitarian goods. However, for the German plastics industry, these exemptions are not widely applicable, leaving the vast majority of its exports to the U.S. subject to the new tariffs.
As of October 7, 2025, the United States has enacted a new tariff framework on Japanese imports, establishing a baseline tariff of 15%. This new rate, part of a landmark U.S.-Japan framework agreement, applies to nearly all goods imported from Japan. The tariff became effective retroactively from August 7, 2025, with full implementation by September 16, 2025. For products whose previous Most Favored Nation (MFN) tariff rate was below 15%, the rate is now adjusted up to 15%. If the MFN rate was already 15% or higher, no additional tariff is imposed, affecting industries like plastics.
Prior to the new agreement, trade in plastics between the U.S. and Japan was governed by Most Favored Nation (MFN) tariff rates, which were generally in the low single digits for most plastic products. The total value of plastics imported by the United States from Japan was approximately $2.73 billion in 2024. This substantial trade volume highlights the significant economic relationship in the plastics sector between the two nations. The new tariff regime marks a departure from the lower, more varied MFN rates that previously facilitated this trade.
The new tariff policy represents a significant shift from the previous structure based on Most Favored Nation (MFN) rates, which were considerably lower for the plastics industry. The introduction of a flat 15% baseline tariff under a bilateral agreement with Japan is a move away from multilateral trade norms. A key feature of this new policy is its retroactive application from August 7, 2025, impacting goods already in transit. This policy aims to reduce the U.S. trade deficit with Japan and incentivize domestic production within the United States.
Upstream Feedstock Production: The tariff for petroleum and natural gas-based feedstocks is now a baseline 15%, superseding an earlier proposed 24% rate.
Midstream Polymer Production: Commodity and specialty engineering polymers are now subject to the 15% baseline tariff under the U.S.-Japan agreement, replacing the previously proposed 24%.
Downstream Fabrication and Distribution: Fabricated products, molded plastics, and packaging fall under the "nearly all imports" clause, making them subject to the new 15% tariff, which is lower than the initial 24% proposal.
The new tariff agreement's language specifies that it applies to "nearly all Japanese imports," suggesting a broad impact across the entire plastics industry. Given the 2024 import value of $2.73 billion, it is presumed that the majority of this trade is now subject to the 15% tariff. This includes subcategories such as upstream feedstocks (petroleum and natural gas-based), midstream polymers (commodity and specialty), and downstream fabricated products like packaging and molded parts.
Currently, there is no publicly available information detailing specific exemptions for sub-sectors of the plastics industry under the new U.S.-Japan trade agreement. While the agreement includes provisions for sector-specific treatment for industries like automotive and aerospace, no such provisions have been announced for plastics. Therefore, the precise value of trade exempted from the new 15% tariff within the plastics industry cannot be calculated at this time.
As of October 7, 2025, the United States has imposed a significant additional tariff of 25% on a wide range of goods from Mexico, including many products from the plastics industry. This measure, effective March 4, 2025, was implemented under the authority of the International Emergency Economic Powers Act (IEEPA). The stated justification for these tariffs is to address national security concerns related to illegal immigration and drug trafficking, as announced by the Trump administration. While a further 30% tariff was announced in July 2025, the prevailing additional rate for non-USMCA compliant goods remains 25%.
The trade relationship in the plastics industry between the U.S. and Mexico is governed by the United States-Mexico-Canada Agreement (USMCA). In 2024, the total trade in plastics and related articles (under HS Code 39) was substantial. U.S. imports of these goods from Mexico were valued at approximately $12.8 billion. Conversely, U.S. exports of plastics to Mexico in the same year reached around $21.74 billion, highlighting a deeply integrated cross-border supply chain for the industry.
This new tariff policy marks a significant departure from the free-trade principles of the USMCA, which succeeded the North American Free Trade Agreement (NAFTA). The previous framework focused on eliminating tariffs for goods meeting specific rules of origin. The current policy, however, utilizes tariffs as a tool to exert pressure on non-trade issues, such as national security and immigration. This shift has created a more unpredictable business environment, drawing criticism from industry groups like Mexico's Anipac, which has warned of disruptions to production networks and increased costs for materials.
Upstream Feedstock Production: Most basic petrochemicals and monomers from Mexico that do not qualify under USMCA are subject to the 25% additional tariff, although some energy products may have exemptions.
Midstream Polymer Production: An additional tariff of 25% is in effect for non-USMCA compliant commodity polymers (like polyethylene) and specialty engineering polymers.
Downstream Fabrication and Distribution: A 25% tariff is applied to non-USMCA compliant fabricated, molded, and packaged plastic articles, though many products may be exempt if a 'substantial transformation' occurs in Mexico.
The new 25% tariff is estimated to affect approximately $7.6 billion worth of U.S. plastics industry imports from Mexico, based on 2024 trade data. This impact is concentrated on goods that do not meet the stringent USMCA rules of origin. Companies unable to certify their products as USMCA-originating, either due to sourcing raw materials from outside North America or not meeting the required transformation criteria, will face significantly higher import costs, potentially disrupting established supply chains and increasing prices for U.S. consumers and businesses.
A significant portion of the plastics trade is exempt from the new tariffs, provided the products qualify as originating from Mexico under the USMCA's rules of origin. It is estimated that overall, 84% of Mexico-U.S. trade remains tariff-free. For primary plastics (headings 3901 to 3915), a key rule requires the originating polymer content to be at least 50% by weight. For fabricated plastic articles, exemption often requires a change in tariff classification, indicating substantial transformation within a USMCA country.
As of October 7, 2025, the United States, under the Trump administration, implemented new tariffs on the Canadian plastics industry. These tariffs, which are in excess of the United States-Mexico-Canada Agreement (USMCA), began with a 25% tariff on non-energy imports on March 4, 2025. This rate was subsequently increased to 35% on August 1, 2025, for goods not compliant with USMCA rules. The tariffs were enacted under the International Emergency Economic Powers Act (IEEPA) to address cited national security concerns.
Trade in plastics between the U.S. and Canada is governed by the United States-Mexico-Canada Agreement (USMCA), which aims to facilitate tariff-free commerce. In 2024, U.S. plastics exports to Canada were valued at approximately $7.3 billion, while Canadian plastics exports to the U.S. were about $14.9 billion. According to the United Nations COMTRADE database, U.S. imports of plastics from Canada amounted to $14.18 billion in 2024, highlighting the deeply integrated nature of the North American supply chain for this industry.
The 2025 tariffs represent a significant shift from the previous policy under the USMCA, which is designed to foster tariff-free trade. The new policy introduces substantial costs for Canadian exporters and U.S. importers by applying tariffs of up to 35% specifically on goods that are not compliant with the agreement's rules of origin. This targeted approach differs from the broad, duty-free access previously enjoyed. In response to the U.S. measures, Canada announced retaliatory tariffs, further escalating trade tensions.
Upstream Feedstock Production: Non-USMCA-compliant petroleum and natural gas-based feedstocks such as ethylene and propylene are subject to a 35% tariff.
Midstream Polymer Production: Commodity polymers like polyethylene and specialty engineering polymers from Canada face a 35% tariff if they do not meet USMCA origin rules.
Downstream Fabrication & Molding: Fabricated products from processes like injection molding are highly vulnerable to the 35% tariff due to a significant drop in USMCA compliance in 2025.
Packaging & Distribution: Plastic packaging materials, including items like bags and lids, are subject to the 35% tariff if they are not USMCA-compliant.
The new U.S. tariffs impact all Canadian plastic products that fail to qualify for preferential treatment under the USMCA's rules of origin. A 2025 report indicated that the USMCA compliance rate for U.S. imports of Canadian plastic products had fallen to just 39.5%, a sharp decline from 98.3% in 2024. This drop exposes a majority of the nearly $14.9 billion trade in this sector to the new 35% tariff. The impact spans the entire value chain, including upstream feedstocks, midstream polymers, and downstream fabricated goods like packaging.
Plastic products and materials originating from Canada that meet the stringent rules of origin stipulated by the USMCA are exempt from the new tariffs. These goods can continue to be traded duty-free between the two nations. This exemption is crucial for the highly integrated North American chemical sector, where the use of regional feedstocks typically ensures a high rate of compliance. The determination of eligibility often depends on complex 'tariff-shift' rules, which require that a product undergo significant transformation within a USMCA country to qualify as originating.
As of October 7, 2025, the United States has introduced significant new tariffs on the Chinese plastics industry, layering on top of existing Section 301 duties. A key measure is an additional 10% tariff on a wide range of Chinese imports, effective March 4, 2025. This was followed by a universal baseline tariff of 10% on nearly all U.S. imports, enacted on April 5, 2025. Additionally, some reports indicate a 20% 'China IEEPA fentanyl' duty has been imposed, citing national security concerns. The de minimis provision, allowing duty-free entry for shipments under $800, was also suspended for products from China as of May 2, 2025.
The U.S. trade relationship with China in the plastics industry is substantial. In 2024, the U.S. recorded a trade deficit in plastics with China of approximately $10.9 billion. During the same year, U.S. plastics exports to China were valued at around $7.3 billion. Based on 2024 data, an estimated $18.2 billion worth of plastics imports from China are potentially affected by the new tariffs. Data from the United Nations COMTRADE database corroborates this, showing U.S. exports of plastics to China at $7.45 billion in 2024. No specific free trade agreement governs this sector; trade is conducted under World Trade Organization rules, now heavily modified by unilateral tariffs.
The 2025 tariff policy represents a significant escalation compared to the previous framework, which was primarily composed of Section 301 tariffs ranging from 7.5% to 25% on specific product lists. The new approach introduces broader, more sweeping measures like the 10% universal baseline tariff and utilizes different legal justifications, including the International Emergency Economic Powers Act (IEEPA). A major change is the elimination of the de minimis exemption for China, which previously allowed shipments under $800 to enter duty-free. This combination of measures creates multiple new layers of tariffs, substantially increasing the total duty on many plastic products.
Petroleum‐based Feedstocks: Subject to up to 25% Section 301 tariffs, plus a new universal 10% baseline and an additional 10% tariff on Chinese goods as of 2025.
Natural Gas‐based Feedstocks: Key feedstocks like ethylene and propylene polymers faced 25% Section 301 tariffs and are now subject to the additional 2025 tariff layers.
Commodity Polymers: Resins like Polyethylene (PE), polypropylene (PP), and PVC now face cumulative duties from the original 25% Section 301 tariffs plus the new 10% baseline and 10% China-specific tariffs.
Specialty Engineering Polymers: In addition to existing 25% tariffs and new 2025 levies, these face a retaliatory 74.9% anti-dumping tariff from China on U.S. exports of polyformaldehyde (POM) copolymer.
Fabrication & Molding: Thousands of finished and semi-finished plastic articles now face cumulative duties from the original 25% Section 301 tariffs plus the new 2025 levies.
Packaging & Distribution: Plastic packaging materials face the original 25% Section 301 duties plus the new 2025 tariffs, with costs further impacted by the suspension of the de minimis provision.
Given the broad nature of the new tariffs, such as the universal baseline and the additional China-specific levy, it is estimated that nearly all $18.2 billion in plastic industry imports from China are impacted. The impact extends across the entire supply chain, from raw materials to finished goods. Furthermore, the suspension of the de minimis rule for China directly impacts the high volume of e-commerce and small-scale shipments that were previously not subject to duties.
Specific exemptions for the new 2025 tariffs have not been detailed. While the U.S. Trade Representative (USTR) has extended some pre-existing exclusions from the original Section 301 tariffs, these are limited in scope. For example, 164 of 429 expiring exclusions were extended through May 31, 2025. However, these extensions explicitly do not apply to the new layers of tariffs added in 2025, meaning very few, if any, plastic products are exempt from the new duties.
On April 2, 2025, the Trump administration announced new tariffs impacting the German plastics industry, introducing a universal baseline tariff of 10% on all goods imported into the U.S., effective April 5, 2025. Furthermore, higher 'reciprocal tariffs' were introduced for countries with which the U.S. has a significant trade deficit. For the European Union, including Germany, this additional surcharge was planned at 20%, with some reports mentioning a potential 50% tariff on EU imports. These reciprocal tariffs were implemented on August 7, 2025, through executive orders.
Prior to 2025, U.S.-Germany trade in plastics was primarily governed by the World Trade Organization's framework, which ensured low or 0% tariff rates on many industrial goods. In 2024, Germany's plastics exports to the United States were valued at approximately $3.74 billion. In 2023, Germany exported $10 billion in plastics to the U.S. and imported $8 billion from the U.S. For context, in 2022, the broader category of chemicals, plastics, rubber, and leather goods constituted 23.0% of U.S. imports from Germany, amounting to $33.7 billion.
The 2025 tariff policy marks a significant departure from the previous framework based on the World Trade Organization's principles, which generally featured low tariffs. The new policy established a broad-based 10% universal tariff on all imports, with additional substantial 'reciprocal' tariffs on major trading partners like the EU. This change represents a major shift toward a protectionist stance in U.S. trade policy. The administration's stated goals for these measures are to reduce the national trade deficit, encourage domestic manufacturing, and create what it terms as fairer competitive conditions for U.S. industries.
Petroleum‐based Feedstocks: A new baseline tariff of 10% has been added, plus a potential reciprocal tariff of 20% or higher.
Natural Gas‐based Feedstocks: A new baseline tariff of 10% has been added, plus a potential reciprocal tariff of 20% or higher.
Commodity Polymers: These products are now subject to the new 10% universal tariff and additional reciprocal tariffs.
Specialty Engineering Polymers: These materials are also subject to the new 10% universal tariff and additional reciprocal tariffs.
Fabrication & Molding: Finished and semi-finished fabricated plastic products now face the 10% baseline tariff plus any applicable reciprocal tariffs.
Packaging & Distribution: Packaging solutions and distributed resins are impacted by the newly imposed 10% universal tariff and additional reciprocal tariffs.
The new tariffs are estimated to affect the majority of Germany's $3.74 billion in plastics exports to the U.S. (based on 2024 data). The impact extends across the entire plastics value chain, from upstream feedstock production to midstream manufacturing of polymers like polyethylene (PE) and polypropylene (PP). Downstream fabricators and distributors are also heavily affected. The German machinery association, VDMA, has voiced significant concern, warning that the tariffs could pose an existential threat to some of its member companies.
While comprehensive lists of exempted products are detailed within the specific annexes of the implementing executive orders, certain strategic products have been granted exemptions. These categories reportedly include essential goods such as pharmaceuticals and semiconductors, along with humanitarian goods. However, for the German plastics industry, these exemptions are not widely applicable, leaving the vast majority of its exports to the U.S. subject to the new tariffs.
As of October 7, 2025, the United States has enacted a new tariff framework on Japanese imports, establishing a baseline tariff of 15%. This new rate, part of a landmark U.S.-Japan framework agreement, applies to nearly all goods imported from Japan. The tariff became effective retroactively from August 7, 2025, with full implementation by September 16, 2025. For products whose previous Most Favored Nation (MFN) tariff rate was below 15%, the rate is now adjusted up to 15%. If the MFN rate was already 15% or higher, no additional tariff is imposed, affecting industries like plastics.
Prior to the new agreement, trade in plastics between the U.S. and Japan was governed by Most Favored Nation (MFN) tariff rates, which were generally in the low single digits for most plastic products. The total value of plastics imported by the United States from Japan was approximately $2.73 billion in 2024. This substantial trade volume highlights the significant economic relationship in the plastics sector between the two nations. The new tariff regime marks a departure from the lower, more varied MFN rates that previously facilitated this trade.
The new tariff policy represents a significant shift from the previous structure based on Most Favored Nation (MFN) rates, which were considerably lower for the plastics industry. The introduction of a flat 15% baseline tariff under a bilateral agreement with Japan is a move away from multilateral trade norms. A key feature of this new policy is its retroactive application from August 7, 2025, impacting goods already in transit. This policy aims to reduce the U.S. trade deficit with Japan and incentivize domestic production within the United States.
Upstream Feedstock Production: The tariff for petroleum and natural gas-based feedstocks is now a baseline 15%, superseding an earlier proposed 24% rate.
Midstream Polymer Production: Commodity and specialty engineering polymers are now subject to the 15% baseline tariff under the U.S.-Japan agreement, replacing the previously proposed 24%.
Downstream Fabrication and Distribution: Fabricated products, molded plastics, and packaging fall under the "nearly all imports" clause, making them subject to the new 15% tariff, which is lower than the initial 24% proposal.
The new tariff agreement's language specifies that it applies to "nearly all Japanese imports," suggesting a broad impact across the entire plastics industry. Given the 2024 import value of $2.73 billion, it is presumed that the majority of this trade is now subject to the 15% tariff. This includes subcategories such as upstream feedstocks (petroleum and natural gas-based), midstream polymers (commodity and specialty), and downstream fabricated products like packaging and molded parts.
Currently, there is no publicly available information detailing specific exemptions for sub-sectors of the plastics industry under the new U.S.-Japan trade agreement. While the agreement includes provisions for sector-specific treatment for industries like automotive and aerospace, no such provisions have been announced for plastics. Therefore, the precise value of trade exempted from the new 15% tariff within the plastics industry cannot be calculated at this time.