In the early morning of April 3, 2025, U.S. President Donald Trump announced to impose reciprocal tariffs on nations worldwide in a move that includes a 34% reciprocal tariff on China, 20% on the EU, 10% on Brazil and the UK, 31% on Switzerland, 26% on India, 25% on South Korea, 24% on Japan, 32% on Indonesia, and 36% on Thailand.

It means that after the implementation of these so-called reciprocal tariffs, the majority of exports from China to the U.S. will be subject to a 54% tariff rate (a universal 20% tariff plus a new reciprocal tariff of 34%). 

Taking polymeric MDI (HS CODE: 39093100) as an example, it will face an 85.5% tariff rate, which includes the following: baseline tariff (6.5%) + Section 301 tariff (25%) + universal tariff (20%) + reciprocal tariff (34%).

Implementation Timeline of the Reciprocal Tariffs

The 10% global tariff took effect on April 5, 2025. The higher reciprocal tariffs will take effect on or after 12:01 a.m. EDT on April 9, 2025, with respect to goods entered for consumption, or withdrawn from warehouse for consumption, except for goods were loaded onto a vessel at the port of loading and in transit on the final mode of transit prior to entry into the U.S., before 12:01 a.m. EDT on April 5, 2025.

The U.S. tariff policy sparked a global uproar. On April 3, multiple countries and representatives from international organizations expressed opposition to the tariff increases. On April 6, nationwide protests erupted against Trump tariffs…

China Proposes Countermeasures Against U.S., Including Imposing Additional 34% Tariff on the U.S.

On April 4, 2025, China released its position on opposing the U.S. abuse of tariffs:

Recently, the United States has imposed tariffs on all its trading partners, including China, under various pretexts. This severely infringes upon the legitimate rights and interests of all countries, severely violates World Trade Organization (WTO) rules, severely undermines the rules-based multilateral trading system, and severely disrupts the global economic order. The Chinese government strongly condemns and resolutely opposes such move.

In response to Trump’s reciprocal tariffs, China has launched a slew of countermeasures. The Customs Tariff Commission of the State Council, the Ministry of Commerce, and the General Administration of Customs have successively announced countermeasures against the U.S., including imposing additional 34% tariffs on all U.S. goods, filing a lawsuit with the WTO over the issue, and adding several U.S. companies to the unreliable entity list.

The Impact of U.S. Reciprocal Tariffs on Chinese MDI Exports Has Marginally Weakened

Taking polymeric MDI as an example again, a 25% tariff has been imposed on polymeric MDI exported from China to the U.S. under the Section 301 since September 2018. From 2021 to 2024, China’s annual exports of polymeric MDI to the U.S. ranges between 220 kT and 280 kT, exceeding the previous export volume of 160 kT in 2017. Despite the increase in costs due to the 25% additional tariff, Chinese producers possess significant cost advantages and a well-established supply chain.

In fact, many businesses have foreseen the potential risks of new tariff plans launched by the U.S. after the announcement of presidential election result. Following the implementation of a 20% universal tariff last month, Chinese MDI exporters had already limited their exports to the U.S. Thus the impact of reciprocal tariffs on Chinese exports has marginally weakened. Nevertheless, the market sentiment remains cautious prior to the actual implementation of these reciprocal tariffs.