02 February 2010 08:07 [Source: ICIS news]
By Becky Zhang
SINGAPORE (ICIS news)--China's restrictive duties on purified terephthalic acid (PTA) imports will send ?xml:namespace>
The Chinese authorities slammed a provisional anti-dumping duties ranging between 2.4%-20.1% on Korean and Thai PTA effective 3 February, while an extended investigation on possible dumping activities will be conducted over a period of six months, according to the country’s Ministry of Commerce.
With the prohibitive duties in place producers in
“The duties of 12.2-20.1% on Thai material were higher than our expectations and will definitely take a hard beat[ing] on producers,” said a China-based trader.
“Thai material is expected to vanish from the Chinese spot market,” he added.
The announcement of a provisional ADD, although long expected, still came as a shock, putting market players at a loss on how to price PTA supplies on Tuesday morning trade, industry sources said.
“Although ADD has been talked about in the market for a long time and everybody have already made various preparations on that, the sudden announcement still brought the market to a standstill,” another trader said.
Some producers in Thailand, anticipating the ADD axe in China to fall anytime this year, had started diversifying into other markets like India where there is a lack of PTA supply, said a major regional trader dealing with Thailand cargoes..
“We have substantially reduced our export volumes to
The loss for
A number of traders were keen to raise offers for Taiwanese cargoes, which would be exempted from China’s provisional but a successful price hike would depend on the strength of demand from PTA’s main downstream – the polyester sector, industry sources said.
Demand from polyester makers started to show signs of softness ahead of the week-long celebration of the Chinese Lunar New Year from 13 February.
“We don’t need to buy spot imported cargoes as our demand has been fully covered by contract volumes till the end of February,” said polyester producer based in
“We will consider reduce[ing] our operating rates during the holidays as the polyester sales would keep thin in the period,” a
Notional selling ideas for domestic cargoes have gone up by yuan (CNY) 200/tonne ($29.3/tonne) on Tuesday to more than CNY8,000/tonne from Monday, industry sources said.
The PTA futures contracts traded on the Zhengzhou Commodity Exchange also reacted to the new policy, with prices for material for May delivery rising CNY 80/tonne ex-warehouse on Tuesday.
“It is definitely good news for us,” said a source at a major Taiwan producer, adding that it was good to remove the uncertainties from the PTA market.
($1 = CNY6.83)
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