(Reuters) -Specialty chemicals company Itaconix said on Thursday it would implement selective price increases and look at cutting supply chain costs to offset the impacts of proposed U.S. tariffs,
Itaconix to Increase Prices and Cut Costs Amid Tariff Impact
(Reuters) -Specialty chemicals company Itaconix said on Thursday it would implement selective price increases and look at cutting supply chain costs to offset the impacts of proposed U.S. tariffs, which are expected to raise production expenses.
The developer of sustainable, bio-based polymers also said euro currency swings from the ongoing trade war and production shifts by various companies to the United States are boosting its revenues in Europe and the U.S.
Overall, Itaconix reaffirmed its expectations for 2025.
WHY IS IT IMPORTANT?
Itaconix said it sources five raw materials from Asia, with two exempt from current tariffs, two facing less than 25% net tariff and one subject to a levy of more than 100% but used in small amounts.
However, any impact from the import of raw materials was expected to take several months, Itaconix added, as the company had last year invested in securing inventory of finished and raw goods to meet demand.
CONTEXT
Companies across the world are evaluating the implications of a global trade war initiated by U.S. President Donald Trump's tariffs on various sectors and countries, which have also intensified concerns of a potential recession.
According to its latest annual report, Itaconix is exposed to trade relations between the U.S., China, Canada and Europe through imports of itaconic acid from China, and sales of its products to Europe and Canada.
The company has one production facility in North America, and holds some finished goods and raw materials at an off-site warehouse there, and another in Europe.
KEY QUOTE
"I believe we are in a net position to continue making gains in the midst of uncertain trade developments," says CEO John R. Shaw.
(Reporting by DhanushVignesh Babu in Bengaluru; Editing by Vijay Kishore)
