By Perc Pineda, Ph.D.
Chief Economist, PLASTICS

Earlier this year, the World Trade Organization (WTO) forecasted the volume of world merchandise trade to grow by 3.0%. In comparison to the 26.3% increase in merchandise trade volume last year, the global trade momentum, it seems, has shifted into low gear. The global economy is beset with persistently high inflation. The appreciation of the U.S. dollar means the depreciation of other currencies, and has implications on global trade, given that the U.S. dollar is the most widely used in international trade. Moreover, adverse geopolitical conditions such as the ongoing Russia-Ukraine war have had knock-on effects on merchandise and services trade.

Geopolitical conflicts have consequences on trade.

The ongoing Russia-Ukraine war reduced U.S. plastics exports—consisting of resin, plastics machinery, molds for plastics, and plastic products—to both countries. As shown in the table below, current year-to-date exports ending in July have decreased more than half, compared to the same period last year. U.S. plastics exports to Russia decreased from $101.1 million to $38.0 million – a 62.4% decrease, and exports to Ukraine have dropped by 51.4%, from $21.3 million to $10.4 million. So far, exports of plastics machinery to Ukraine, and exports of molds for plastics to Russia, have stopped this year.

While data reveals the extent of the negative impact of the Russia-Ukraine war on the U.S. plastics trade, Russia is one of the top ten U.S. sources of polytetrafluoroethylene (PTFE) and other fluoropolymers. In 2019, 2020, and 2021, the U.S. imported PTFE and fluoropolymers totaling $14.1 million, $16.0 million, and $19.7 million, respectively. These were equivalent to 1.4 million kgs in 2019, 1.9 million kgs in 2020, and 1.7 million kgs in 2021. These ten countries – Japan, India, China, Germany, Italy, Netherlands, Russia, France, Belgium, and the United Kingdom, have been key exporters of PTFE and other fluoropolymers to the U.S. for years. In 2021, 98.4% of the total 30.2 million kgs of U.S. imports of PTFE and other fluoropolymers--which are critical to the U.S. manufacturing sector and consumer products--originated from these ten countries. [1] This year, year-to-date ending in July, U.S. imports of PTFE and other fluoropolymers from Russia totaled 0.97 million kgs – down from 1.2 million kgs compared to the same period last year.

The COVID aftermath is still a factor affecting trade.

Overall, the U.S. plastics industry had a trade surplus with the rest of the world for years until the COVID-19 pandemic in 2020. As far as U.S. plastics trade with Russia and Ukraine, the decrease in exports and imports also means a decrease in the U.S. plastics trade surplus with both countries. U.S. trade surplus with Russia and Ukraine fell by $59.7 million and by $9.3 million, respectively, year-to-date ending July 2022. While both countries are not top export markets of the U.S. plastics industry, trade with these countries grew over time, as has the trade surplus, which unfortunately is now adversely affected by the war in Ukraine.

The global trade rebound after the pandemic in 2020 caused U.S. plastics exports to Russia to increase by 8.1% in 2021. The share of resin and plastic products exports to Russia were 46.4% and 47.1%, respectively. U.S. plastics exports to Ukraine rose 39.9% with resin making up 77.2% of the total exports in 2021. U.S. plastics imports, however, decreased 16.8% from Russia and increased 19.1% from Ukraine.

Geopolitical conflicts affect labor and manufacturing supply chains.

Exports support jobs   and the plastics industry, by virtue of years of trade surplus, has a proven history of supporting high-paying jobs. According to the U.S. International Trade Administration 4,802 jobs were supported per billion dollars of manufactured goods exports in 2020. Based on this metric, the U.S. plastics exports to Russia and Ukraine in 2020 supported 1,057 jobs in the U.S. The number of jobs supported by U.S. plastics exports would show an increase, were the Russia-Ukraine conflict not a factor.

Ukraine’s top exports to the U.S. include iron and steel (HTS # 7201 and 7304), which are used in U.S. manufacturing. In 2021, U.S. imports of these materials combined had a customs value of $1.1 billion. Year-to-date, ending in July 2022, U.S. imports of iron and steel from Ukraine were down 53.0%, in customs value, compared to the same period last year. With the U.S. manufacturing sector as the main customer of the U.S. plastics industry, a decrease in imports of inputs to manufacturing activities does not help the ongoing supply chain challenges, particularly if domestic supply is inadequate, and has far reaching effects downstream.

The trade outlook, overall, has weakened.

It would not be surprising if the merchandise trade volume growth this year misses the WTO forecast, which has been revised to 3.5% recently, not only because of the ongoing Russia-Ukraine conflict and its indirect and indirect impacts on trade beyond plastics. The war in Ukraine will undoubtedly have global trade-reducing effects, however, lower trade volume this year would be due to a slowing global economic growth as financial conditions tighten further, and countries continue to battle persistent inflation.


  [1] PLASTICS has an active Fluoropolymers Division. Visit for more information and schedule of events of the Fluoropolymers Division.