Plastics trade U.S. successfully navigates shifting economic winds

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Plastics Industry Association

Jongen Werkzeugtechnik GmbH

CUMSA

AMPCO METAL Deutschland GbmH

In the contrasting landscape of the 2023 plastic materials and resin trade, U.S. exports fell in dollar value, yet saw a surge in volume, amidst a global backdrop of weakening prices and manufacturing activity. Despite a sharp dip in imports, the U.S. trade balance improved, reflecting a nuanced interplay of economic forces.

Plastic materials and resin trade figures for 2023 exhibited a mixed performance compared to 2022. In terms of dollar value, U.S. exports of plastic materials and resin experienced a 10.8 percent decline, dropping from 44,177.02 million to 39,397.41 million dollars on a free alongside (FAS) basis, according to preliminary trade data from the U.S. Census Bureau.

Import and export dynamics

This reduction in export value, however, was less pronounced than the 24.5 percent decrease in the value of imports, which declined from 22,893.35 million in 2022 to 17,290.56 million dollars in 2023 on a customs value basis. The diminished U.S. manufacturing activity in 2023 contributed to the decline in imports of plastic materials and resin, a versatile commodity widely used across the manufacturing sector.

Trade balance improvement

Despite the apparent deterioration in both export and import figures, the U.S. trade balance in plastic materials and resin improved, marking a 3.9 percent increase in 2023 compared to the previous year. This improvement is attributed to a more substantial decrease in the dollar value of imports, which declined at a higher rate compared to the decrease in exports. In 2022, the U.S. trade surplus for plastic materials and resin amounted to 21,283.67 million dollars, and it rose to 22,106.85 million dollars in 2023. This positive development suggests a more favorable balance in the trade of these materials for the U.S. plastics materials and resin manufacturers.

Impact of weakened manufacturing

The impact of a weakened manufacturing sector on the trade of plastic materials and resin becomes evident when examining the trade quantities. U.S. imports of these commodities dropped from 9,571.68 million kilograms (M kg) to 8,812.95 M kg. The 7.9 percent decline in U.S. imports in 2023 can be attributed not only to the subdued manufacturing activity but also to the consequences of a weakened U.S. dollar throughout the 2023 trade cycle.

Global trade dynamics

It is essential to acknowledge that plastic materials and resin are globally traded commodities denominated in U.S. dollars. The depreciation of the U.S. dollar in 2023 from its 2022 highs resulted in elevated import costs. Concurrently, the weakened dollar bolstered U.S. export competitiveness, leading to a significant 13.7 percent increase in U.S. exports of plastic materials and resin, rising from 20,516.44 M kg in 2022 to 23,331.21 M kg in 2023. Comparing this to the decline in the dollar value of exports suggests that prices of plastic materials and resin have continued their global descent.

Price trends and indices

Examining the Producer Price Index (PPI) for plastic materials and resin commodities, the index reached its peak in the second half of 2021 through the first half of 2022. Subsequently, resin prices experienced a downturn. The PPI by commodity for plastic resins and materials fell by 6.4 percent in December compared to the same month a year earlier.

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