Close the Loop Limited (ASX: CLG) anticipates a favorable impact from recent tariffs imposed by the US government and other countries on imports and exports related to the USA. The tariffs are expected to make new laptops, printers, computing, and gaming accessories more expensive globally, leading to increased demand for certified refurbished products, a sector in which Close the Loop is a prominent player.
The company’s Mexicali facility benefits from the T-MEC Trade Agreement, which exempts laptops, printers, computing, and gaming accessories crossing the US/Mexico border for refurbishment from tariffs. Components and packaging made in the USA and used in the refurbishment process in Mexico are also exempt. However, components and packaging from other countries used in Mexicali will be subject to tariffs based on their country of origin. Equipment imported into Mexico through a US port is exempt from tariffs if transferred directly to Mexico, while imports from other countries are subject to existing tariffs (e.g., 2-15% from China).
In the USA, at Close the Loop’s Texas and Kentucky facilities, goods sold by OEMs within the USA can be refurbished without tariff implications. However, products, components, packaging, and raw materials imported into the USA for refurbishment will now attract higher tariffs, and the company is reviewing the associated costs. Despite these increased costs, Close the Loop believes the increased demand for less expensive recycled products will offset any negative financial impact. Close the Loop, with operations in multiple countries, collects and refurbishes electronics and provides sustainable packaging solutions, aiming for ‘Zero Waste to Landfill.’
