American Painting Contractor

China tariffs could hike paint costs

Picture of Kevin Hoffman

Kevin Hoffman

Recently proposed tariffs could have a rebound effect on the cost of raw materials for U.S. painting contractors.

After America threatened to impose tariffs on China, the communist nation responded by threatening to halt exports of all raw metals to the U.S.

While this is aimed at causing price inflation for consumer electronics, it could also have a knock-on effect for painters.

House paint can contain metals including aluminum, chromium, zinc, and titanium, which are among the export bans threatened by China. The saber-rattling is a response to the new administration’s threat of imposing a 60% tariff on all Chinese imports.

Professional painters in Reddit’s r/paint subreddit sounded the alarm at the end of last week.

“Hey fellow industry professionals,” wrote a redditor named Scientific_Coatings. “Just want to give a friendly reminder out there to be sure to add material price cost increase clauses in your contracts. (Should already, but more important now.)”

The redditor suggests that if the tariff war were to come to pass, “it would make [the] Covid industry scramble look like child’s play.”

Of course, there is still a fair chance that this doesn’t happen. Threats are a well-worn negotiation tactic. The two parties could come to the table and make an agreement that is mutually beneficial and doesn’t hike prices for consumers.

We may find out soon enough, however. If the rhetoric doesn’t cool, paint manufacturers may take preventative measures to protect profit margin.

“Also, paint typically has price increases (almost) every February, which ranges anywhere from $1-$5 depending on the company and line,” points out redditor Benemisis. “So with the expected tariffs on China, it will likely increase SIGNIFICANTLY more. Don’t be surprised when your gallon of paint is $15 more than you paid last year (and please don’t bug the paint desk people about it, they have no control over the prices.”

The same Reddit thread contained anecdotal reports that consumers are pulling back on spending for painting and restoration.

“I can already tell people are scared to spend money,” wrote Drinkmorepatron. “My phone has been suspiciously quiet.”

“Coatings manufacturer here,” wrote another redditor. “Though we’re primarily automotive, we’ve gotten the projections and they are grim. We’ve already had our largest (and newest residential sector) customer push back business to Q2-3.”

Last week, we told you that ICE raids are causing some construction workers not to show up for the job. Additional labor costs could be coupled with added material cost, hitting painting contractors with a double whammy.

One thing is for sure: It’s shaping up to be an interesting summer.