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After Phase 1 trade deal, China exempts several plastics from tariffs

China announced Dec. 19 it removed tariffs on U.S. exports of several specific grades of plastic, after Beijing and Washington announced the first phase of a trade deal last week, according to news reports.

The announcement included metallocene high density polyethylene, a linear low density PE grade and a copolymer of impact grade polypropylene, along with an ethylene-propylene adhesive, a mineral oil and food grade micro-crystalline wax, according to a report from the chemical news service ICIS.

The exemptions take effect Dec. 26 and last for one year. The development came in a brief announcement from China's Customs Tariffs Commission of the State Council.

An analyst told Reuters news service that the exemptions on plastics would benefit U.S. companies that have been adding production and planning on exporting to China, which is the world's largest importer of PE. Kelly Cui from Wood Mackenzie told Reuters that the exemptions could see China buying more HDPE and LLDPE from the U.S., reversing tariff trade flows that had shifted U.S. exports to Latin America and Europe.China had exempted products from its tariffs previously, after importers had petitioned, in a process similar to the U.S. tariff exemption procedures.

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