11 July 2006 11:43 [Source: ICIS news]
SINGAPORE (ICIS news)--Asian and Middle Eastern high-density polyethylene (hdPE) suppliers were likely to be affected by the European Commission's (EC's) planned anti-dumping duties on Chinese plastic bag imports, company sources said on Tuesday.
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The PE producers were anticipating lower sales volumes and margins, and an official from a Southeast Asian company said exports were likely to be cut from August.
Resin suppliers could divert their material to Chinese traders and bag processors who cater to the domestic market, said an official from a South Korean producer. However, the margins from this market were likely to be lower, he added.
This was because their customers paid import duties and taxes for the material, and were more resistant to high prices, he said. Export-oriented processors were exempted from import duties and taxes and could therefore afford to pay higher prices for imports, he added.
“We may look at increasing the domestic share of our sales in August, but we’ll have to work with the converters. If they increase their exports, we will also have to increase allocations to them,” added a Malaysian producer.
Some sources said that low-density polyethylene (ldPE) sales could also be affected by the duties, given that it is blended with hdPE for packaging applications.
However, ldPE is also widely used for agricultural films and that is expected to help support its prices and import demand in the coming months. The Chinese agricultural film production season is due to begin in end-August.
Prema Viswanathan contributed to this story.
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