BEIJING—The Ministry of Commerce of the People's Republic of China announced the final ruling results of the styrene monomer antidumping duties investigation June 22, with some U.S. companies facing the implementation of duties of up to 55 percent.
According to figures provided by consultants with Wood Mackenzie, the duties cover companies from South Korea, Taiwan and the U.S., with leading Korean firms such as Lotte Chemical, LG Chem and SK Global facing duty rates of 7.5 percent, 6.6 percent and 6.6 percent respectively.
In the U.S., Lyondell Chemicals, Westlake Styrene, Ineos Styrolutions and Americas Styrenics are facing duty rates of between 13.7 percent and 13.9 percent. "All other" suppliers, said the Wood Mackenzie report, face a duty rate of 55.7 percent.
Commenting on the duties, which have been preliminarily enforced since February this year, Truong Mellor, Wood Mackenzie senior research analyst, said both the U.S. and South Korea saw a steep drop in volumes into February 2018 ahead of the preliminary tariff announcement.
"Taiwan shipped an additional (20,0000 metric tons), but this uptrend was quickly reversed by March," Mellor said. "Q1 2018 has already seen a marked difference in the trade flows of styrene into China in anticipation of the preliminary ADDs, which were announced in February."
According to Mellor, U.S. imports into China dropped from 111,000 tons in the first quarter of 2017 to just under 65,000 tons in the first quarter this year.
Similarly, South Korea imports into China more than halved in the first quarter of this year at 111,000 tons, compared to 255,000 tons in 2017.
Taiwan imports into the country, edged up from 65,000 tons in the first quarter of 2017 to just under 70,000 tons this year, said Mellor, adding that last year's numbers were impacted by turnaround activity.
Speculating over where these volumes were being diverted to, the Wood Mackenzie analyst said a bulk of U.S. exports, which were slightly higher year-on-year at 352,000 tons in the first quarter, were destined for Mexico.
Close to 70,000 tons of product moved into western Europe compared to 5,000 tons the previous year, noted Mellor.
Turkey absorbed a 20,000 ton shipment, compared to nothing over the same period last year.
The higher final duty numbers, warned the analyst, likely will accelerate this trend going forward. European suppliers must "carefully manage" the balance, "either through higher exports into the Mediterranean, Asia or by trimming back domestic operating rates."
He further noted that South Korea has begun moving export volumes into other countries within Asia since late last year.
Close to 30,000 tons have been shipped to India since December 2017, he added.
While exports have increased to Malaysia, Japan and Thailand, the amount has not been enough to counteract the drop in China-bound volumes, totaling around 175,000 from January-May 2018, Mellor added.
As for Taiwan, volumes have been increasingly moving to South Korea, India, Hong Kong and Vietnam.