China domestic MMA may extend gains amid probe on imports

By Viola Pan

SINGAPORE (ICIS)–China’s domestic methyl methacrylate (MMA) prices have risen by 7-8% so far this month, and may continue heading north as availability of supply is being hampered by an ongoing antidumping probe on imports, market sources said on Wednesday.

Some traders have hiked offers to CNY18,500/tonne ($3,008/tonne) this week, they said.

On 26 August, MMA prices in east China were at yuan (CNY) 18,200-18,300/tonne ($2,959-2,976/tonne) EXW (ex-works), up by CNY1,300-1,400/tonne from the start of the month, according to Chemease, an ICIS service in China.

China launched on 8 August an antidumping investigation on MMA imports from Singapore, Thailand and Japan, but no provisional antidumping duties (ADDs) will apply during the one-year duration of the probe, which could extend up to 8 February 2016  under special circumstances, according to the country’s Ministry of Commerce.

Some traders have been holding on to their cargoes on expectations that prices will continue to increase, market sources said.

China is a major importer of MMA, although it has a capacity to produce 568,000 tonnes/year of the material. Its MMA plants are currently running at a reduced rate of 60%, according to Chemease, an ICIS service in China.

In July, the country imported 28,780 tonnes of MMA, representing a 28% increase from the previous corresponding period, according to China Customs data.

Industry sources are worried that the domestic market will face a supply shortage if China’s MMA imports fall below the monthly volume of about 20,000 tonnes, as will inevitably happen in August because of the antidumping probe.

The resulting high domestic MMA prices, meanwhile, are causing downstream plants to cut production, market sources said.

A number of small-sized downstream acrylic ester multipolymer (ACR) and esters factories have either cut operating rates or shut down their plants, they said.

Meanwhile, bigger downstream plants that manufacture polymethyl methacrylate (PMMA) plates can still afford to run at normal rates with enough feedstock MMA supply secured on contract to support production for this month, at least, industry sources said.

Some market players are not expecting a further increase in MMA prices given current high levels and amid strong resistance being posed by end-users.

($1 = CNY6.15)

Additional reporting by Dora Zhou

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections