Tariffs create unrest among lubricants industry
Jul 31, 2018
The lubricants industry is one of many markets caught in the line of fire of the U.S. and China trade war that has been heating up since April. On July 6, each country implemented 25 percent tariffs applying to hundreds of products, including many lubricants and lubricant additives.
Although the specific repercussions of these drastic tariffs remain unknown, many think the increased duties will more so impact the prices for additive components made in China that are imported into the U.S.
Since there are more U.S.-based additive, base stock and finished lube companies supplying into China than the alternative, some companies must consider several factors to keep balanced pricing and customers happy.
Recently, the American Chemistry Council issued a statement opposing the tariffs. “China is one of the U.S. chemical industry’s most important trading partners,” the group noted. “This hostility has now put U.S. chemical manufacturing directly against China at the front lines of this conflict.”
International trade is the lifeblood of many chemical companies who rely upon open access to foreign markets. Learn more about the direct effects on the lubricants industry and ways businesses can minimize financial impacts here.
Why should you care?
At this point, it’s highly unlikely anyone in the lubricants market will be unaffected by this escalating trade dispute. Whether it’s an increase in raw material costs for production or the downstream effects on end use customers, it’s necessary to stay up-to-date on shifting supply and demand sparked by this evolving trade war.