In mid-May 2026, the China-US summit and subsequent economic and trade consultations reached a phased consensus, marking the transition of Sino-US economic and trade relations from high-intensity friction to a new stage characterized by dispute management, limited easing, and stable expectations. Foamed silicone rubber (classified as other parts for vulcanized rubber machinery and instruments), as a key product category in China's organic silicone deep-processing industry, has its foreign trade trajectory closely tied to Sino-US tariffs, market access, and supply chain restructuring. This round of trade easing goes beyond mere tariff reductions; it reshapes the export landscape of foamed silicone rubber across four dimensions-tariff structure, classification criteria, compliance thresholds, and industrial competitiveness-thereby alleviating years of high-pressure barriers while accelerating the industry's shift from "scale-driven low-cost" strategies to "high-end compliance + global strategy."
I. Precision in Coding and Tax Rate Determination: Tax Burden Characteristics in the China-US Trade Friction
Foamed silicone is classified by Chinese Customs as "Other parts for machines and instruments made of vulcanized rubber (excluding hard rubber)," with the legal unit being kilograms. It enjoys an export tax rebate rate of 13%, a value-added tax rate of 13%, and an export duty rate of 0%, making it a typical deep-processed rubber product. Under the U.S. Harmonized Tariff System (HTS), it corresponds to item 4016.99 "Other vulcanized rubber products" and has long been included in the Section 301 list subject to additional tariffs.
Prior to this round of peace talks, the overall tax burden on exports of expanded silicone rubber to the United States was extremely high:
United States Most-Favored-Nation Basic Tariff: 8%
Additional levy under Article 301:25%
Article 122: Temporary Tariff: 10%
Some batches are subject to cumulative reciprocal tariffs: a combined tax rate of 5%–10%, with the maximum reaching 43%, severely undermining China's core competitiveness of "scale leadership + cost-effectiveness," leading to a significant outflow of mid-to-low-end orders to regions such as Southeast Asia and India.
II. Direct benefits of this round of trade negotiations for expanded silicone rubber: reduced tariffs, cost recovery, and order repatriation
Under the China-U.S. Economic and Trade Framework finalized on May 14,2026, the U.S. side has abolished 95% of new tariffs imposed after 2025, suspended the 24% punitive tariffs for 18 months, and phased out remaining Section 301 tariffs. This arrangement delivers three direct benefits for foam silicone production:
The overall tax rate has decreased significantly.
301: A 25% surcharge will be imposed, with partial phase-out implementation (to take effect from June to September)
Article 122: The 10% temporary tariff is included in the cancellation list.
The actual comprehensive tax rate was reduced from 43% to a range of 8%–13%, directly restoring price competitiveness to over 30%.
The classification dispute has been resolved, and customs clearance efficiency has improved. For a long time, the ambiguous nature of "rubber/plastic/composite materials" had led to classification discrepancies, abrupt tariff rate changes, and high sampling rates. This round of negotiations established a mutual recognition mechanism for HS code classifications, with the U.S. side acknowledging China's declarations of vulcanized rubber components, resulting in reduced inspection intensity and a 10%–15% decrease in port detention costs.
The cost of upstream raw materials remains stable, and the tax refund policy continues.
Primary organosilicon compounds (DMC, 107 adhesive) have been included in the tariff exemption list, with upstream costs remaining stable or showing a slight decline.
The export tax rebate rate remains unchanged at 13%, supporting corporate gross profit margins and preventing cutthroat price competition.
Results: Mid-to-low-end orders previously lost due to high tariffs-such as those for new energy vehicle seals, photovoltaic buffers, and home appliance shock absorbers-have rapidly returned. Exports to the United States in Q3 2026 are projected to grow by 20%–25% quarter-on-quarter.
III. Structural Challenges Remain: High-end Barriers, Stricter Compliance, and Intensified Competition
The tariff easing does not signify full market liberalization; the U.S. continues its "mid-range liberalization, high-end protection" strategy for premium foam silicone, facing three prominent challenges:
Barriers to entry for high-end applications: New energy vehicle battery sealing, semiconductor buffers, and medical-grade foamed silicone (high value-added, high-margin products) continue to face restrictions from the U.S. through technical standards, certification barriers, and supply chain reviews, resulting in a market share of less than 5% in the U.S. high-end segment.
The FDA has tightened environmental compliance requirements: food contact, infant and child products, and medical products must submit test reports on volatile silicone compounds (D4–D9), heavy metal migration, and high-temperature stability. Non-compliant products will face immediate seizure or destruction, while compliance costs increase by 15%–20%.
Intensifying international competition is driving Southeast Asia and Mexico to capture a share of mid-to-low-end orders by leveraging their advantages in low labor costs, US-Mexico tariff exemptions, and the Regional Comprehensive Economic Partnership (RCEP), thereby exacerbating global price wars.
IV. The Unique Advantages and Long-Term Strategic Path of China's Foamed Silicone
Compared with German high-end brands, American technological monopolies, and low-cost contract manufacturing in Southeast Asia, China's foam silicone boasts four irreplaceable unique advantages:
The world's largest production capacity coupled with a complete industrial chain: From raw materials DMC and 107 adhesive to foaming, molding, and deep processing-all processes are independently controlled, resulting in costs 40% lower than those in Europe and America and 15% lower than in Southeast Asia.
Market leadership + affordable pricing: Leveraging the vast domestic demand in sectors such as new energy, photovoltaics, home appliances, and healthcare, the company has established core competitiveness through large-scale production, inclusive pricing, and rapid delivery.
Strong scenario adaptability: Capable of rapid customization for products with varying densities, hardness levels, flame retardancy, and antibacterial properties, catering to diverse global application scenarios.
High supply chain resilience: Maintained a delivery rate above 95% even during the pandemic and operational disruptions, significantly outperforming overseas competitors.
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