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Reduction of PVC duties in China and ASEAN to increase export of Chinese PVC

January 12/2012

MOSCOW (MRC) -- Since the 1st of January 2012, the agreement on free trade оf PVC between China and ASEAN came into force. To a greater extent this agreement is beneficial to the Chinese side, which will be able to increase exports to these countries, according to MRC analysts.

From January 1, 2012, there were cancelled customs duty on PVC import in accordance with the agreement on China-ASEAN free trade between China and six member countries of the Union (Indonesia, Malaysia, Thailand, Philippines, Singapore and Brunei-Darussalam). According to Chinese customs, imports of PVC in 2010 was about 1.2 million tonnes, with about 87% of the total imports that fell on resin producers from USA, Japan and Taiwan (328 thousand tonnes, 427 thousand tonnes and 284 thousand tonnes, respectively).

Over the eleven months of 2011,  imports of PVC to China reduced to 944 thousand tonnes, with about 817 thousand tonnes that fell on the resin from the U.S., Japan and Taiwan.

Exports of PVC from China, on the contrary,  increases. In 2010, the total export volume of Chinese PVC was about 218 thousand tonnes. The leaders of resin imports from China were Russia, Uzbekistan and South Korea, with 113 thousand tonnes, 20 thousand tonnes and 23 thousand tonnes respectively. Over the eleven months of 2011, exports of PVC from China grew to 355 thousand tonnes, the main exports volume fell on Russia, Korea and Uzbekistan (114 thousand tonnes, 28 thousand tonnes and 25 thousand tonnes respectively).

According to some market participants, this agreement will not change the structure of PVC imports to China seriously.

Quite a long time the main foreign suppliers of PVC to China have been the producers from the United States, Japan and Taiwan, and it will be very difficult to press them out of the Chinese market, first of all because of the limited production capacities of PVC in ASEAN countries.

Thus in Thailand, which is the most developed in terms of consumption and production, the output of PVC makes about 1 million tonnes, while domestic consumption is slightly more than 500 thousand tonnes.

The agreement will allow China to increase PVC exports to these countries. According to preliminary data by January 1, 2012 the total capacity of Chinese producers of PVC had reached 19 million tonnes per year. In 2010, PVC consumption in China made around 12 million tonnes.

Author:Marina Ivanova
Category:General News
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