OUTLOOK: US chems prepare for more tariffs under shifting trade regime
Al Greenwood
16-Jul-2026
HOUSTON (ICIS)–Within days, the US is expected to continue imposing new tariffs on imports from dozens of trading partners, leaving the chemical industry facing continued uncertainty over where duties will ultimately settle.
It already imposed 25% tariffs on imports from Brazil. These and others would be imposed under Sections 301 and 232. They are intended to replace temporary duties imposed under Section 122, which will expire on 24 July.
Looking ahead, the chemical industry could get a respite from a proposed board of trade between the US and China. The board could exclude some imports from tariffs, but it is still under discussion.
The one trade policy that remains stable is the US-Canada-Mexico Agreement (USMCA), which remains in force while it undergoes annual joint reviews.
NEW TARIFFS COULD TAKE EFFECT ON 24 JULY
Many trade lawyers expect the US will impose tariffs on the 60 countries and regions by 24 July. This is the expiration date of the global 10% tariffs that the US imposed under Section 122.
The new tariffs are the result of an investigation that the US conducted under Section 301, a statute intended to address unfair trade practices.
The probe investigated allegations that the countries imported products and intermediates made from forced labor.
The following table shows the proposed tariffs that could take effect by 24 July.
Economy
Tariff
Algeria
12.5%
Angola
12.5%
Argentina
10.0%
Australia
12.5%
Bahrain
12.5%
Bangladesh
10.0%
Brazil
12.5%
Cambodia
10.0%
Canada
10.0%
Chile
12.5%
China
12.5%
Colombia
12.5%
Costa Rica
12.5%
Dominican Republic
12.5%
Ecuador
10.0%
Egypt
12.5%
El Salvador
10.0%
EU
10.0%
Guatemala
10.0%
Guyana
12.5%
Honduras
12.5%
Hong Kong
12.5%
India
12.5%
Indonesia
10.0%
Iraq
12.5%
Israel
12.5%
Japan
12.5%
Jordan
12.5%
Kazakhstan
12.5%
Kuwait
12.5%
Libya
12.5%
Malaysia
10.0%
Mexico
10.0%
Morocco
12.5%
New Zealand
12.5%
Nicaragua
12.5%
Nigeria
12.5%
Norway
12.5%
Oman
12.5%
Pakistan
10.0%
Peru
12.5%
Philippines
12.5%
Qatar
12.5%
Russia
12.5%
S Korea
12.5%
Saudi Arabia
12.5%
Singapore
12.5%
South Africa
12.5%
Sri Lanka
12.5%
Switzerland
12.5%
Taiwan
10.0%
Thailand
12.5%
The Bahamas
12.5%
Trinidad and Tobago
12.5%
Turkey
12.5%
UAE
12.5%
UK
10.0%
Uruguay
12.5%
Venezuela
12.5%
Vietnam
12.5%
Source: US Trade Representative
MORE SECTION 301 TARIFFS COULD TAKE EFFECT
Under a separate Section 301 investigation, the US has imposed tariffs of 25% on imports from Brazil. If the US moves forward on the other proposed tariffs, then Brazilian imports covered by both actions could face cumulative duties of 37.5%.
Another Section 301 probe is investigating allegations that 16 governments relied on excess manufacturing capacity to obtain an unfair trade advantage. The US has yet to propose tariffs.
The following table lists the governments under investigation.
Economy
Bangladesh
Cambodia
China
EU
India
Indonesia
Japan
Malaysia
Mexico
Norway
South Korea
Singapore
Switzerland
Taiwan
Thailand
Vietnam
Source; USTR
The US is conducting other Section 301 investigations against the following countries:
Economy
Tariff
Description
China
Pending
Compliance with 2020 trade deal
Vietnam
Pending
Intellectual property protection and enforcement
Germany
Pending
Germany’s payments for pharmaceuticals
Source; USTR
MORE TARIFFS POSSIBLE UNDER SECTION 232
The US is investigating imports of entire product categories under Section 232. Unlike Section 301, which targets alleged unfair trade practices by specific governments, Section 232 focuses on whether imports of particular products threaten national security.
The following table lists pending Section 232 investigations:
Unmanned aircraft systems
1-Jul-25
pending
Wind turbines
13-Aug-25
pending
Robotics and industrial machinery
2-Sep-25
pending
PPE, medical consumables, medical equipment
2-Sep-25
pending
Anthracite coal
29-Jun-26
pending
Source: Bureau of Industry and Security (BIS), Federal Register
Over the years, the US has expanded or restricted the scope of existing Section 232 tariffs. In the case of steel, this resulted in an indirect tariff on imports of products like fluorochemicals because the duty covered the containers in which they were shipped.
The following table lists completed Section 232 investigations. In some cases, the investigations concluded with tariffs. In others, they led to further discussions but no tariffs. They are all subject to revisions that could expand their scope or change their rates.
Product
Investigation Started
Rate
Autos and auto parts
Completed
25%
Copper products
Completed
50%
Steel
Completed
50%
Aluminium
Completed
50%
Softwood lumber
Completed
10%
Upholstered furniture
Completed
25%, 30% on 1 Jan ’27
Kitchen cabinets, vanities
Completed
25%, 50% on 1 Jan ’27
Medium duty trucks
Completed
25%
Heavy duty trucks
Completed
25%
Buses
Completed
10%
Critical minerals
Completed
No tariffs
Semiconductors
Completed
25% on few imports, may be expanded
Patented pharma, APIs
Completed
100%
Commercial aircraft
Completed
No tariffs
Jet engines
Completed
No tariffs
Source: BIS
US MOVES FORWARD ON PROPOSED BOARD OF TRADE WITH CHINA
While most current trade actions point toward higher tariffs, industry groups also see a possible avenue for relief through a proposed US-China board of trade.
The US conducted hearings earlier in July about such a board. It would identify non-sensitive sectors for purchase commitments and lower tariffs.
The US has a surplus of more than $33 billion in chemicals and a smaller one with China, according to the American Chemistry Council (ACC), a trade group. It made its comments in a hearing the US held earlier in July about the board.
The ACC highlighted three ways that the board could improve trade for the chemical industry:
The US still imports chemicals and other materials that are not available in the US, the ACC said. Those imports are critical, with each $1 in imports supporting more than $7 of US chemical export, the ACC said. “These inputs should be strong candidates for tariff relief, particularly where they support US exports and do not implicate sensitive end uses.”
China has relied on what the ACC alleged are nonmarket practices to build excess chemical capacity. This has led to a global glut of many commodity chemicals. Before nonsensitive imports can qualify for tariff relief, they cannot receive unfair subsidies or benefit from other nonmarket practices.
China can reduce duties and remove non-tariff barriers to US exports of plastics and chemicals.
The Plastics Industry Association (PLASTICS) cautioned that the US should not treat the sector as a single, homogeneous category because different subsectors have different trade balances with China.
Plastic resins have maintained a surplus, machinery has shifted to a deficit, molds have experienced a growing deficit and plastic products have maintained a long-standing deficit.
Some products compete directly with US producers, others complement local production and some are no longer made in the US, PLASTICS said.
Like the ACC, PLASTICS stressed the importance of market access, because some of the nation’s trade deficit could be caused by trade barriers erected by China.
USMCA REMAINS IN FORCE WHILE SUBJECT TO ANNUAL REVIEWS
While US tariff policy will remain in flux, one major trade deal continues to provide stability: the US-Mexico-Canada Agreement (USMCA).
The trade agreement went into effect in 2020 and was subject to a joint review earlier this month.
Under the joint review process, the three countries could extend the USMCA for another 16 years. If they do not reach consensus, the USMCA will be subject to another joint review the following year.
The three countries did not unanimously agree to an extension. As a result, the USMCA will remain in force while the three countries conduct annual joint reviews, according to the law firm White & Case.
“All current USMCA rights and obligations, including preferential tariffs, rules of origin, investment protections, and dispute settlement mechanisms, remain fully operative,” the law firm said.
That means imports from Canada and Mexico will remain exempt from tariffs if they comply with the USMCA.
The annual reviews will continue until the countries agree to extend the USMCA, the current 16-year term expires on 1 July 2036, or one of the countries withdraws from the trade deal.
Any country can withdraw from the USMCA by providing six months’ notice.
The USMCA is important to the chemical industry because Canada and Mexico are the two largest trading partners of the US.
Its continuity will be the exception to an otherwise tumultuous year for trade policy.
