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Airbus Tariffs - How Will 100% Duty on E.U. Imports Affect Textile Yarn Costs?

You may have heard that the United States and the European Union are in an escalating battle over imports and exports. Although the fight has been simmering for almost 15 years, it heated up quickly in recent weeks.

On April 12th, the United States announced a list of$11 billion worth of goods to impose tariffs to levy on the European Union. This is in response to European subsidies to Airbus where in May 2018 the World Trade Organization ruled these subsidies illegal. This means U.S. textile importers could potentially face a duty of up to 100% on certain textiles coming from the E.U.

Preliminary Textile Product List

In May, a U.S. trade committee will hold public hearings on this issue and develop a written plan that could make the tariffs official. The World Trade Organization (WTO) and the Office of the U.S. Trade Representative (USTR) are expected to make a final decision this summer.

Until then, we have a preliminary product list that was released by the U.S. Trade Representatives on April 12.

The following is a portion of the list that is specific to some of the textile commodities that could be subject to tariffs of up to 100%:

HTS Stat. Reporting #

Description

5205.31.00 Multiple or cabled cotton yarn, 85% or more cotton by weight, of uncombed fibers, n/o 14 nm per single yarn, not put up for retail sale.
5206.32.00 Multiple or cabled cotton yarn, <85% cotton by weight, of uncombed fibers, over 14 but n/o 43 nm/single yarn, not put up for retail sale.
5208.13.00  Unbleached 3- or 4-thread twill fabrics of cotton, incl. cross twill, containing 85% or more of cotton by weight, weighing not over 200 g/m2.
5402.11.30 Single high tenacity yarn of aramids, not put up for retail sale
5402.11.60  Multiple (folded) or cabled high tenacity yarn (except sewing thread) of aramids, not put up for retail sale.
5402.20.30 Single high tenacity yarn of polyesters, not put up for retail sale.
5503.20.00 Synthetic staple fibers, not carded, combed or otherwise processed for spinning, of polyesters.
5605.00.90 Metalized textile yarn nesoi, of man-made monofilament or strip or the like, other than ungimped or w/twist of <5 turns per meter.
5609.00.10 Articles of yarn, strip, twine, cordage, rope or cables nesoi, of cotton.
5609.00.20 Articles of yarn, strip, twine, cordage, rope or cables nesoi, of vegetable fibers except cotton.
5609.00.30 Articles of yarn, strip, twine, cordage, rope or cables nesoi, of man-made fibers.
5609.00.40  Articles of yarn, strip, twine, cordage, rope or cables nesoi, of man-made fibers.

 

In the complete preliminary list, a variety of finished textile materials are included as well.  It includes types of carpets, sweatshirts, pullovers, coats, suits, pajamas, swimwear, blankets and bed linens.

Click here to see the complete list.

What This Means for Importers

U.S. manufactures and importers using textile products from the list above could see significant impacts on material costs if the tariffs are implemented. This will impact companies directly who buy products from the E.U. and indirectly for made in the U.S. products requiring one of these material types from the E.U.

The affected exporting countries include all E.U. countries:

  • Austria
  • Belgium
  • Bulgaria
  • Croatia
  • Cyprus
  • Czechia
  • Denmark
  • Estonia
  • Finland
  • France
  • Germany
  • Greece
  • Hungary
  • Ireland
  • Italy
  • Latvia
  • Luxembourg
  • Malta
  • Netherlands
  • Poland
  • Portugal
  • Romania
  • Slovakia
  • Slovenia
  • Spain
  • Sweden
  • United Kingdom

 

When these tariffs are implemented, they will likely impact global pricing for these materials outside of the E.U. as well.  Recall that In September of 2018, additional tariffs of 10 percent were imposed on polyester. With 70 percent of the worldwide polyester capacity found in China, the tariffs caused an overnight increase in global polyester pricing due to supply and demand for polyester worldwide.  E.U. tariffs will certainly impact global pricing on the materials listed depending on the supply, demand, regional capacity varied by material or commodity.

What Do You Think About Import Duties?

If you wish to share your thoughts with the U.S. trade committee, give feedback during the public comment period.

The deadline to submit a request to attend a public hearing in Washington, D.C. is May 6. The deadline to submit a written statement for consideration by the committee is May 28.

Click here if you would like to submit feedback to USTR using the Federal eRulemaking Portal.

If you would like to find out more information on the textile commodities and products these duties could impact, connect with Service Thread below.

Contact Us To Learn More

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