Taiwan’s Formosa Plastics Group posted combined losses exceeding NT$25 billion (US$794 million) in the second quarter, as the industrial conglomerate buckled under pressure from escalating US trade tariffs, volatile oil markets and a strengthening local currency.
All four major subsidiaries of Taiwan’s largest petrochemical producer fell into the red during the three months ended June, according to self-reported results released Thursday. The flagship Formosa Plastics Corp recorded a NT$6.6 billion loss, while Formosa Petrochemical suffered the steepest decline with NT$7.5 billion in red ink.
The dismal performance reflects broader challenges facing Taiwan’s industrial sector as President Trump’s universal 10% baseline tariff on imports disrupts global supply chains. Economic modeling suggests the tariffs could reduce Taiwan’s GDP growth by 1.2 to 2.5 percentage points, particularly affecting petrochemical exporters.
Formosa Plastics cited three primary headwinds: declining crude oil prices that compressed refining margins, tariff-related market uncertainty that dampened customer demand, and the New Taiwan dollar’s appreciation against the greenback that eroded export competitiveness. The company specifically noted that US tariff escalations have caused petrochemical trade flows to shift dramatically, forcing customers into wait-and-see mode.
The group’s first-half losses totaled NT$21.3 billion, compared with profits in previous periods. June revenue across the four companies reached NT$113.5 billion, representing a monthly increase of 7% but a year-over-year decline of 10.3%.
Nan Ya Plastics, despite posting a NT$4.1 billion quarterly loss, reported some bright spots in its electronics materials division as artificial intelligence infrastructure investments boosted demand for specialized components. However, currency headwinds and investment losses from petrochemical affiliates offset operational improvements.
The results underscore Taiwan’s vulnerability to shifting US trade policies, with the island’s heavy reliance on American markets creating exposure to Trump’s “reciprocal tariff” strategy that initially targeted Taiwan with 32% duties before being reduced to 10% pending negotiations.
