Friday, July 8th, 2016

Plastics Champions Take On Capitol Hill

On June 22, 2016, members of the plastics industry met with lawmakers during the 2016 Plastics Industry Fly-In, an event that gives professionals the opportunity to talk about important issues impacting plastics with our nation’s lawmakers. Nine plastics industry trade associations invited their members to come out and storm the Hill to have their voices heard. At the 2016 Plastics Industry Fly-In, first-time attendees began building relationships with members of Congress and their staffers, while returning participants were able to discuss progress and address new challenges.

This year’s Fly-In kicked off with an evening reception, followed by a briefing the next day featuring plastics industry experts who spoke about key issues that attendees would be bringing to the attention of lawmakers on the Hill later that day, including trade, tax and labor issues.

Equipped with the latest updates on the industry’s most pressing issues, the Plastics Champions left for their Hill meetings – but not before capturing a group picture in front of the U.S. Capitol.

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The 2016 Plastics Industry Fly-In Attendees on the steps of the Capitol.

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            From left to right: SPI’s Katie Masterson and Kiran Mand, Rep. Billy Long (R-MO), and Jarden Plastics’ Jessica Bursack.

Plastics Champions participated in a total of 99 SPI-arranged Hill meetings with members of Congress and/or their staff. Key industry recommendations included:

  • Passing the Trans-Pacific Partnership which offers important growth opportunities for the plastics industry.
  • Blocking the Department of Labor and National Labor Relations Board from enforcing new rules and standards intended to curb employer and employee flexibility and rights.
  • Moving corporate tax reform that allows for business certainty and encourages investment.
  • Supporting energy policy that encourages prudent development and utilization of domestic natural resources.
  • Using Congressional oversight authority to increase transparency and adherence to sound science and risk-based decisions in regulatory agency rulemaking.
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Fly-In Attendee Monica Filyaw of PolyQuest with Rep. David Rouzer (R-NC).

When their meetings concluded, the Plastics Champions headed from the Hill to an evening reception for a chance to network with fellow members of the plastics industry and members of Congress.

SPI members left D.C. with the tools and connections necessary to follow up with Congressional offices to supply additional information on pressing issues, schedule plant tours with elected officials in their home states and continue an ongoing. The meetings are just a starting point for what SPI hopes will be fruitful, continued relationships.

Thursday, June 30th, 2016

How Will the Brexit Impact the U.S. Plastics Industry?

Brexit concept jigsaw puzzleBy Michael Taylor, Vice President, International Affairs and Trade, SPI: The Plastics Industry Trade Association

The vote by 52 percent of the United Kingdom to leave the European Union—the so-called British exit (Brexit)—has sent shockwaves across global financial markets and ushered in a period of uncertainty for manufacturers on both sides of the Atlantic. The vote could further undermine growth within Europe and potentially around the globe. Given the size of the U.S. economic relationship with Europe, the U.K. decision may have significant ramifications for the American plastics industry.

The U.S. commercial relationship with the U.K. and EU combined is the U.S.’ largest in the world, representing about 40 percent of the global economy. Trade of U.S.–EU manufactured goods reached $836 billion in 2015, and cross-border investment equaled more than $5 trillion. Many U.S. companies with EU operations have headquarters in London, and about 17 percent of U.S.-manufactured exports to the EU are destined for the U.K.

The U.K. is the 9th largest export market for the U.S. plastics industry representing more than $1.3 billion dollars in goods in 2015, and our 8th largest import market with more than $249 million dollars in goods in 2015. While the day-to-day operations of businesses in the United Kingdom, European Union or the United States may not be directly impacted by the Brexit immediately, all businesses engaged in the transatlantic market should prepare for the changes that are inevitably coming.

It’s expected that what the Brexit means for manufacturers in the United States and their partners in Europe won’t be fully known for years. Soon the United Kingdom will begin negotiations with the EU under Article 50 of the Treaty of the European Union to set the terms of its withdrawal, a negotiation which some expect may take two years or more. Until the U.K. officially withdraws from the EU, it should be treated as an EU member state in trade for purposes of tariffs and other technical matters. Eventually, however, our trading relationship with the UK will experience increased costs and red tape after they have completely withdrawn from the EU. For U.K. manufacturers exporting into the EU, EU standards and regulations are expected to continue to apply for those goods to be eligible for sale, but much as they would normally apply to U.S. exports, rather than to exports from EU member companies.

Big Ben and Union Jack flag in England

Regarding the Transatlantic Trade and Investment Partnership (TTIP), a major trade treaty currently being negotiated, it is clear that the Brexit vote will be a drag on the progress of the deliberations. Prior to the vote, it was apparent that the differences separating the United States and EU in the TTIP talks were larger than the areas of shared objectives and perspectives. With the U.K. and EU now preparing to enter into a multi-year withdrawal negotiation, there are serious questions as to whether the TTIP talks can result in a truly meaningful and comprehensive agreement or even any deal at all. In addition, the loss of the UK voice within the EU will likely make it even more difficult for a deal to be struck. On a positive note, there is the possibility of a U.S.-U.K. free trade agreement, but this opportunity would still be years away at this point, and only be a fraction of the size of an ideal TTIP agreement with the entire EU.

All this said, although it is a significant event with notable economic consequences, the Brexit vote is unlikely to usher in a recession. It is very clear that all of the key players stand ready to intervene in the financial markets vigorously to buoy their economies as required. Specifically, in the U.S., the Federal Reserve will likely cut interest rates as opposed to raising them, counterbalancing any negative investment consequences the Brexit might have in the near-term for U.S. stakeholders.

But the causal relationship between political and economic uncertainty and negative market and trade consequences is well established. The Brexit will most likely have impacts akin to past Eurozone crises, at least in the short term. It will shake financial markets and consumer confidence, cause a majority of business decision-makers to hedge and serve as an unwelcome drag on economic growth and demand.

Thursday, June 9th, 2016

Plastics Industry Welcomes First Bipartisan TSCA Update in 40 Years

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SPI President and CEO William Carteaux

Earlier this week the Senate approved a much-needed update to the Toxic Substances Control Act (TSCA). The bill is now headed to President Barack Obama’s desk for signature. Here’s what SPI President and CEO William Carteaux, had to say about the first substantive update to TSCA in four decades:

“The U.S. plastics industry and its partners have worked tirelessly with multiple Congresses and administrations to make our nation’s outdated chemical regulatory infrastructure stronger and more responsive to the needs of today’s consumers and companies.

Today those efforts have paid off in the form of bipartisan legislation marking the first substantive update to the Toxic Substances Control Act in four decades.

CongressSunriseViewThis consensus-based bill is the product of thoughtful discussions by House and Senate negotiators.  It gives consumers the confidence in the products they depend upon each day, while giving companies a more predictable regulatory system that’s based on science rather than rhetoric.  The plastics industry also applauds lawmakers for ensuring that the new bill provides for the preservation of confidential business information, ensuring that the growth this bill is certain to unlock won’t be jeopardized.

This is a great day for the U.S. plastics industry and its nearly one million workers and their families. We look forward to continuing to grow the American economy by manufacturing the safest, strongest and most technologically advanced products and materials.”

Thursday, May 26th, 2016

Bridging the Gap between Policymakers and Business Owners

Every year, members of the plastics industry have the opportunity to fly to Washington, D.C. to meet directly with members of Congress and voice their opinions on policies that directly affect their line of business. The Plastics Industry Fly-In is a way to bridge the gap between policymakers and business owners. Members of Congress and their staffs deal with a number of issues and when they are able to put a face and story to a policy, it helps them make better informed decisions. Below are comments on the importance of the Fly-In from some industry members who have participated in past Fly-Ins:

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Ted Fisher, Sales Director, ALAC International, Inc.: “I attended my first Fly-In in 2010, and haven’t missed one since.

The initial exposure to the inner, inside-office and inner workings on Capitol Hill was significant. I went from a deer in the headlights to being fairly comfortable very quickly, but you have to take that first step. Going up there with your colleagues and having things laid out for you, like they are at the Fly-In, certainly gets you up to speed pretty quickly.

When you’re face-to-face with the staffers, senators and the congressmen themselves, that’s your opportunity to convey what’s important to your organization, and you can’t do that remotely. You’ve got to be in front of them to make an impact.”

 

Wylie Royce

Wylie Royce, Partner, Royce Associates: “Too many people in our industry think that because they may not come from a large company, going to D.C. is a waste of time. There is also an assumption that the big company lobbyists will take care of the industry issues for them, and that is simply not the case. Lobbyists take care of what they are paid to take care of, and if it coincides with your interests that’s good; if it doesn’t, then you are letting someone who has no interest in your future make your business decisions for you.

After one or two visits to D.C. to attend the Fly-In you may think, ‘Why should I bother? Nothing seems to be getting done.’ What’s getting done is you are building a relationship with the legislators who can directly affect your business, and this relationship isn’t built overnight. Instead, it requires several visits and follow-up calls. By building this relationship, you are becoming a credible source of information to your legislators and their staff, and you will have a voice in decisions that they make. In some cases, that could mean the difference between continuing and dropping a complete line of products.”

Greg Leighton with Rep. Tony Cárdenas (D-CA) at C&G Mercury Plastics.

Greg Leighton with Rep. Tony Cárdenas (D-CA) at C&G Mercury Plastics.

Greg Leighton, Owner, C&G Mercury Plastics: “The benefits of the Fly-In are that I get to see my legislators personally. When I talk to them on the phone they recognize me. I When I invite them for a plant tour, they come.

I went to Congressman Tony Cardenas’ office at a Fly-In a couple of years ago. A few years after, we invited him to visit our plant, and he came. He brought his chief of staff, toured the plant and was impressed by what we were doing.

The Fly-In also shows the next generation that you don’t have to be nervous to do this. There’s all this angst out there for the next generation: ‘What’s the future going to look like?’ You need to show that you can participate in that future.”

Participating in the Fly-In is a key step in creating long-term relationships with legislators and policymakers that can benefit your company for years to come. This year, the Fly-In will be held June 21-22 on Capitol Hill. To register, click here.

Wednesday, May 25th, 2016

The U.S. Plastics Industry’s Top Five Export Markets

Of the U.S. plastics industry’s $427 billion in annual sales, slightly more than 20 percent of that comes from exports, according to SPI’s 2015 Global Trends Report. The lion’s share of that goes to these top five export markets for the U.S. plastics industry as of 2015.

Sunday´s bikers in Paseo de la Reforma, Mexico

1) Mexico

No surprise that the first entry on this list is America’s closest neighbor and strongest trading partner.  The U.S. exported $15.8 billion in goods to Mexico in 2014. Mexico’s plastics industry relies greatly on its U.S. partners, particularly when it comes to resin, where the U.S. has a $6.7 billion surplus with Mexico.

Toronto skyline

2) Canada

The U.S. plastics industry exported $13.2 billion worth of products to its northern neighbor in 2014. The North American Free Trade Agreement (NAFTA) drives a great deal of America’s beneficial trade relationships with both Canada and Mexico, but this relationship goes both ways. Most U.S. polyethylene imports come from Canada, a country with rich hydrocarbon resources that can be converted into chemicals and resins.

Beijing, China CBD Cityscape

3) China

The world’s largest resin consumer is America’s third-largest export market, where U.S. companies had a $2.8 billion surplus in 2014 (as opposed to a $9.2 billion deficit for the industry as a whole).

Rio

4) Brazil

Brazil relies heavily on U.S. products from throughout the plastics supply chain, with the U.S. running trade surpluses with the country in all four plastics categories (resin, plastic products, molds and plastics machinery).

Yokohama

5) Japan

Japan could overtake Brazil to become the fourth-largest export market for U.S. companies (if it hasn’t already since the time of this writing) but regardless, it remains an important trade partner for the U.S. and ships a great deal of machinery put to use at U.S. companies.