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Where will Chinese PET head following new duties?

  • 27/09/2017 (10:48)
China’s export-oriented PET market has been facing a strong possibility of losing market share across the globe due to the rising number of countries which impose customs and anti-dumping duties on PET imports from China.

In March 2017, Indonesia started to implement a 5% customs duty on PET imports from China while players are still waiting to hear for the results of the public hearing conducted by Komite Anti-dumping of Indonesia (KADI) regarding the implementation of the anti-dumping duties of 5% on PET imports from China, South Korea and Malaysia.

“The public hearing regarding the implementation of the ADD was held on August 6 and Chinese producers submitted more supportive documents to KADI. Now we are waiting for further notice,” a Chinese player noted. A Malaysian converter said, “We think that Chinese PET will lose market share in Indonesia due to the ADD. We are planning to wait before making any purchases until a clearer picture is drawn for Indonesia.”

The Canada Border Services Agency (CBSA) announced on August 18 that they launched an anti-dumping investigation on certain PET resin originating in and/or exported from China, India, Oman and Pakistan. The CBSA will make a preliminary decision by November 16, 2017 after investigating whether the imports are being sold in Canada at unfair and/or subsidized prices.

On top of these, Japan, the top export destination for Chinese PET, officially announced on September 1, 2017 that a provisional anti-dumping duty will be implemented on PET with a high degree of polymerization originating in China. The temporary anti-dumping duties will be imposed from September 2, 2017 to January 1, 2018.

A Chinese producer commented, “We are keeping our export offers stable from last week despite the recent increases in global markets in the midst of supply issues in Europe and the US. Chinese PET suppliers’ market share has already diminished across the globe following the implementation of some anti-dumping duties.”

According to some players, Japan’s anti-dumping duty imposed on Chinese PET has already gave an upper hand to Southeast Asian and Taiwanese suppliers in their price negotiations in the absence of Chinese sellers.

A Taiwanese PET producer noted, “More Japanese buyers are placing inquiries nowadays as they are not interested in Chinese cargoes anymore due to the provisional anti-dumping duty. Meanwhile, demand from the US is better as overall supplies have diminished there after Harvey Hurricane.” The producer reminded that the US also applies a high anti-dumping duty on Chinese PET.

Meanwhile, a Chinese PET exporter said, “Demand from Japan has faded due to the ADD, yet we continue to sell our materials to other outlets including India. Still, we must accept that Chinese PET is set to lose a considerable market share in the global markets due to the anti-dumping duties imposed by several countries. Considering India’s overall PET production capacities, we think that its import market is not large enough the replace Japan.”

In Europe, which is an attractive route for Asian PET makers, Chinese PET struggles to compete with other origins including South Korea despite the fact that the European Union terminated the 13-year-long anti-dumping measures on China’s PET on February 7, 2017. “This is good news for Chinese PET exporters, yet they continue to struggle when selling to Europe as Chinese materials are still subject to customs duty while South Korean PET is exempt from any duties," players opined.

Meanwhile, Turkey has been imposing safeguard measures on PET imports for the last six years while the country can be considered self-sufficient in PET production given its four domestic producers. Therefore, it is not seen as a potential destination for Chinese PET in the future either.
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