US Tariff Hike Will Put Pressure on China’s Medical Consumable Makers, Insiders Say
Lin Zhiyin
DATE:  May 15 2024
/ SOURCE:  Yicai
US Tariff Hike Will Put Pressure on China’s Medical Consumable Makers, Insiders Say US Tariff Hike Will Put Pressure on China’s Medical Consumable Makers, Insiders Say

(Yicai) May 15 -- The US government’s plan to hike tariffs on medical consumables made in China, such as syringes, masks and gloves, is likely to have a big impact on Chinese exporters of these products, industry insiders told Yicai.

The US government plans to impose a 50 percent tariff on syringes and needles and a 25 percent levy on personal protective devices such as masks and respirators this from the current zero this year, while the taxes on medical rubber gloves will be lifted to 25 percent from 7.5 percent in 2026, the White House said yesterday.

China exported USD224 million worth of syringes and needles, USD74 million of masks and USD442 million of medical rubber gloves to the US last year, according to China Customs’ statistics.

In 2018, China exported disposable syringes to 179 countries and regions and the US was its biggest customer, accounting for almost half of all exports at 45.8 percent, according to global trade data platform United Nations Comtrade.

Kindly Enterprise Development Group is one of the few listed Chinese firms that owns a complete industrial chain of syringes and needles. Kindly reported CNY2.5 billion (USD346.2 million) in operating revenue last year, 30 percent of which came from overseas.

It is not known yet when the US will implement the tariff hike and how this will affect Shanghai-based Kindly, a person from the board secretary’s office told Yicai. Between 70 percent and 80 percent of the company’s foreign trade revenue comes from Western countries.

China produces 90 percent of the world’s polyvinyl chloride gloves, and Chinese firms’ global shipments of nitrile gloves, which are made of synthetic rubber, are the fastest growing sector, US consulting firm Frost & Sullivan said in a recent report.

Bluesail Medical is adjusting its strategy to focus on markets outside the US to cope with any possible changes in the market, the medical glove maker told Yicai. It will still be two years before the US raises tariffs on medical gloves, so there are still many uncertainties and it is not known yet how the implementation will impact the firm, it added.

INTCO Medical plans to build more production facilities overseas to mitigate the impact of higher tariffs and expand its footprint in non-US markets, the medical glove maker said at its recent earnings conference.

The shares of some medical consumables manufacturers edged down today, and the index tracking overseas-listed syringe stocks dipped 1.5 percent.

Editor: Kim Taylor

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Keywords:   Medical Consumables,USA,Tax,Syringes,China