U.S. plastics industry trade improves in 2021 after 2020 pandemic slump, report says

During the 2020 COVID-19 recession, stimulated by federal relief dollars, U.S. plastics consumption held up at a time when employment was down and capacity was constrained, a new report from the Plastics Industry Associations says, with the result being higher imports and a trade deficit.

The U.S. plastics industry’s trade balance fell to a US$5.5 billion deficit in 2020, from a US$0.7 billion surplus in 2019, according to executive summary of the Plastics Industry Association’s Global Trends report, which was released Oct. 13.

Industry exports fell 8.2 per cent and imports rose 1.8 per cent, the summary said, with Mexico and Canada remaining the U.S. plastics industry’s largest export markets. In 2020, the industry exported US$13.7 billion to Mexico and US$11.7 billion to Canada.

“The industry had its largest trade surplus with Mexico in 2020 – US$8.2 billion,” the summary said. “China is the industry’s third largest export market; however, the industry, overall, had its largest trade deficit with China – US$15.3 billion in 2020.”

The estimated value of domestic shipments fell 2.2 per cent in 2020, to US$282.8 billion. “Shipments figures were depressed by the COVID-19 recession, supply chain
constraints and lower prices,” the summary said. “Exports amounted to 20.4 per cent of domestic shipments in 2020, down from 21.8 per cent in 2019.”

The U.S. plastic resin sector, meanwhile, had a US$18.6 billion surplus in 2020, which was down 6.9 per cent from the US$20.0 billion surplus in 2019. “U.S. resin exports decreased 9.1 per cent in dollar terms from 2019 to 2020, while imports decreased 12.0 per cent,” the summary said. “Lower resin prices were a factor.”

And the U.S. plastics machinery industry registered a US$2.0 billion trade deficit in 2020, the summary said, which doesn’t show much change from 2019. “Exports fell 14.4 per cent, and imports fell 6.5 per cent,” the summary said. “The industry had its largest surplus with Mexico at US$184million, and its largest deficit with Germany at
US$772 million.”

“Although the merchandise trade outlook is much brighter this year, uncertainties remain and depend largely on global economic recovery,” said Plastics Industry Association chief economist Perc Pineda. “While the U.S. plastics industry trade volume rose 27.9 per cent in the first six months of 2021 compared to the same period in 2020, it still has a plastics trade deficit. The large and growing plastics industry outside the U.S. will continue to compete with the U.S. for overseas markets as well as for their own domestic markets.”

Canada and Mexico will continue to be the two largest export markets and are also the top sources of U.S. plastics imports, the summary noted, and the manufacturing sector’s supply chain in these countries was strengthened with the passage of the North American Free Trade Agreement (NAFTA). “The updated free trade pact, United States Mexico Canada Agreement (USMCA), should further enhance trade among the three countries, which is important particularly as global manufacturing is experiencing supply chain difficulties,” the summary said.

The 2021 complete Global Trends report is available to download for free for members and is available for purchase to non-members here.

The executive summary is available here.