India’s MCI recommends ADDs on LDPE imports: Update

Adds table

The Indian Ministry of Commerce and Industry (MCI) is recommending anti-dumping duties (ADDs) on low density polyethylene (LDPE) imports from Saudi Arabia, Thailand and the US after completing an investigation.

The duties vary and are specific to each producer. Duties on cargoes imported from Saudi Arabia range from $17.05-70.09/metric tonne. ADDs on imports from Thailand are $89.14-216.76/t. Imports from the US are subjected to ADDs of $74.27/t, except for cargoes from Westlake Chemical, which was exempted. LDPE imports from the UAE, Qatar, South Korea and Malaysia were exempted.

MCI began the anti-dumping investigation on 23 October 2020 following an application by India's Chemicals and Petrochemicals Manufacturers Association.

Reactions to the MCI's findings have been mixed. Some Indian participants said the duties are justified to safeguard local markets. The announcement was also timely, with the deadline for the Bureau of Indian Standards PE quality control registrations approaching on 6 April. Participants said the combination of the two measures will ensure buyers receive quality imports without disrupting local PE markets.

But other participants said the ADDs are not necessary, as local LDPE production is unable to keep up with demand, particularly for more specialized grades. Privately-owned Reliance Industries is India's only LDPE producer, with capacity of 505,000 t/yr. In 2021, India's net imports of LDPE were about 212,000t according to customs data compiled by Global Trade Tracker.

Recent inflationary pressures and higher feedstock prices have driven up LDPE import prices, making it more difficult for converters to maintain healthy margins. LDPE supplies to India have also been tightening as LDPE-ethyl vinyl acetate (EVA) swing producers worldwide forgo LDPE production for EVA production because of better netbacks on EVA.

Participants are awaiting a formal announcement by India's central government on implementation of the duties. Some market participants expect the duties to be implemented in the next two-to-four weeks, as with previous ADDs on other commodities. The MCI has recommended the LDPE duties be imposed for five years from the date of implementation.

Argus today assessed LDPE film at $1,710-1,730/t cfr India.

By Matthew Rajendra