Industry association Plastics Europe has urged a de-escalation in ongoing trade tensions between the EU and the US, following the inclusion of polyethylene (PE) among products proposed by the European Commission for retaliatory tariffs.
"The imposition of tariffs, particularly on industrial goods such as plastics, will disrupt supply chains, raise costs for businesses, and negatively impact consumers on both sides of the Atlantic," said Plastics Europe's managing director, Virginia Janssens, on 13 March. "We urge both the EU and U.S. to prioritise diplomatic solutions to avoid escalating trade tensions further."
The European Commission on 12 March begun consultations on imposing countermeasures to US tariffs of 25pc on EU and other imports of steel, aluminium and related products. Other products include high-density polyethylene (HDPE), low-density PE (LDPE) and linear LDPE (LLDPE), according to a European Commission document listing the products proposed for retaliatory tariffs.
The European Commission did not publish the specific level of proposed tariffs, noting that a formal legal proposal will follow consultation with industry and member states. But a senior EU official noted that "25pc might be a good number".
The retaliatory tariffs, if approved by EU member states, will be implemented from 13 April.
The US is a key global supplier of PE, with exports totalling around 14.2mn t in 2024. PE exports from the US to the EU in 2024 stood at 2.1mn t, forming around 15pc of the export share. The EU is a net importer of HDPE and LLDPE.
This week's developments caught many market participants by surprise. There was no immediate impact on prices as many participants opted for a wait-and-see approach. The European PE market has been grappling with an uncertain demand outlook given weak underlying economic conditions.
An imposition of import tariffs could help support domestic European PE production, but there are widespread concerns of these resulting in higher prices for consumer goods and adversely affecting future demand prospects. And higher costs of inputs could further hurt competitiveness of European finished goods in the global markets.
Plastics Europe called for "collaborative efforts to resolve this dispute in a manner that protects industry, jobs, and consumers in both the U.S. and Europe."
