India’s new anti-dumping duties on PS to shake up domestic market

SINGAPORE (ICIS)–India is set to soon impose new anti-dumping duties (ADD) on imported polystyrene (PS), a move which is expected to shake up the domestic market which has already been reeling from the effects of the coronavirus pandemic.

Last week the Indian government released the findings of its year-long anti-dumping duty (ADD) investigation into imported polystyrene (PS).

The probe concluded that dumping had been taking place and advised duties ranging from $35 to $474 on cargoes from six origins — Iran, Singapore, Malaysia, Taiwan, the UAE and the US.

Origin	ADD rates ($/tonne)
Iran	183*-309
Taiwan	39**-296
UAE	78
US	474
Malaysia	54
Singapore	35

*  Specific ADD rate for Iran’s Takht-e-Jamshid Pars Petrochemical Company
** Specific ADD rate for Taiwan’s Formosa Chemicals & Fibre Corp

While the exact date of implementation of the duties is not yet known, most market players expect the duties to take effect sometime in July.

Demand for both general purpose polystyrene (GPPS) and high impact polystyrene (HIPS) has fallen with GPPS being especially hard hit following the a collapse in end-user demand for packaging, bangles, stationary items, among others.

Moreover, difficulties in restarting industrial plants and factories amid labour shortages and a swelling pandemic have created significant supply bottlenecks, leading to overall stagnation of the market.

In the backdrop of such weak demand and supply conditions, the expected imposition of the ADDs is likely to negatively affect buyers as it is expected to decrease their bargaining power vis-à-vis domestic PS producers.

Once the ADDs come into effect, most buyers expect PS imports to decrease dramatically, especially from Iranian producers who had been offering cargoes at attractive rates, often in cash transactions.

This is likely to benefit domestic producers in India who saw a surge in enquiries last week following the ADD investigation findings as buyers in the Indian market expected them to raise offers once the duties come into effect.

Several buyers felt that the imposition of the ADDs and associated increase in prices is likely to weaken PS demand further by accelerating the long-term trend of buyers shifting away from HIPS to other polymers such as ABS and PP.

Producers in southeast and east Asia meanwhile did not appear too concerned about the impact of the proposed ADDs on their trades.

Hampered by weak demand, Indian PS prices have been consistently lagging those in China and other Asian markets by a significant margin and most Asian producers were not considering India as a target market, preferring to focus on China instead.

Focus article by Prateek Pillai