China's polyester industrial yarn export to face escalating pressure after EU raised anti-dumping duty

Polyester industrial yarn (PIY) has a high proportion of export, with export proportion at around 30% in recent years. In 2022, PIY exports were at 522.9kt, accounting for around 28% of total PIY production.

EU is one of the major destinations for China's PIY, basically taking up around 25-30% of the total export. In 2022, exports of PIY to EU amounted to 122.5kt, occupying near 23% of the total, the lowest proportion in recent five years.

As early as 2009, at the application of the European Man-made Fibres Association, the European Commission filed an anti-dumping investigation on high tenacity yarns originating in China, and made the final anti-dumping ruling on December 1, 2010. On November 28, 2015, the European Union conducted another anti-dumping sunset review and filing investigation. On February 25, 2017, the European Commission issued a final review of anti-dumping at sunset, and the result of the ruling is shown below. On October 11, 2019, the European Union announced that it had decided to grant treatment to new exporters of Wuxi Solead Technology Development Co., Ltd., imposing an anti-dumping duty of 5.3%.

On February 23, 2022, when the EU's five-year anti-dumping expired, the European Commission issued a notice saying that in response to the application submitted by the European Man-made Fibers Association on November 24, 2021, the second anti-dumping sunset review investigation was launched on polyester high tenacity yarns originating in Chinese mainland. On June 30, 2022, the European Commission announced that in response to the application submitted by the European Man-made Fibers Association on April 1, 2022 and May 16, 2022, the anti-dumping measures applicable to polyester high tenacity yarns originating in China were reviewed during the period of review, and at the same time, an anti-dumping investigation was launched again against Zhejiang Hailide New Materials Company, which received zero tax rate in the previous trial.

Compared with these two anti-dumping results, the rate was largely elevated in 2023 but the increment differed. The anti-dumping tariff of Hailide is the lowest this time, at 6.9%, who was the only company enjoying the duty-free previously. The next is Guxiandao, with anti-dumping duty at 9.7%, up by 4.6 percentage points over last time. Unifull saw the biggest change, with the anti-dumping tariff up by 18.2 percentage points to 23.7% from 5.5%. Other companies witnessed the increase of tariff at 7.4, 11.9 or 13.9 percentage points etc. Among major PIY suppliers in China, Unifull will encounter increasing pressure in exporting to the EU and Hailide and Guxiandao enjoy some advantage compared with other companies.

In 2022, impacted by the geopolitical conflict and high inflation abroad, the export demand of China-made PIY weakened. As a result, exports of PIY fell. The overseas demand is expected to moderately improve in 2023. After new units in China started operation, domestic sales will confront fiercer competition. Thus, companies will continue exploring export markets. PIY exports were previously estimated to rise but it may be not optimistic this year when the EU raises the anti-dumping duty. According to the latest data from China customs, PIY exports were at 193kt in Jan-Apr, 2023, up by 4.6% year on year, and the growth rate throughout 2023 may be lower than this level.