Brief analysis on Vietnam's preliminary determination of anti-dumping duty on PFY

On April 6, 2020, in response to applications from Vietnamese domestic enterprises, the Ministry of Industry and Trade of Vietnam issued an anti-dumping case announcement and decided to formally initiate an anti-dumping investigation on polyester filament yarn originating from China, India, Indonesia, and Malaysia, involving products under HS code 5402.33.00, 5402.46.00, 5402.47.00. It was the first time that Vietnam launched anti-dumping investigation on polyester filament yarn from China.

On August 31, 2021, the Vietnamese Industry and Trade Department decided to levy provisional anti-dumping duties on polyester yarn originating from China, India, Indonesia and Malaysia. The dumping tax rate for Indian yarn is at 54.9%, at 21.94% for those from Indonesia, at 21.23% for those from Malaysia and at 9.47-17.45% for those from China (with some as low as 3.44% or 3.36%). The preliminary determination of anti-dumping duty was executed 3 days after the date of release, with the execution period within 120 days. (The specific anti-dumping duty)

China still enjoyed obvious advantage in terms of the tax rate, especially when the anti-dumping duty for India at 54.9%. China is expected to possess higher market share in Vietnam’s PFY market.

Except for the difference among nations, the anti-dumping rate among various companies also apparently differed. Among leading large enterprises, the anti-dumping rate for Hengli is at 11.41%, at 17.45% for Rongsheng and Shenghong, 11.62% for Tongkun, 10.85% for Xinfengming and 3.44% for Hengyi.

POY (54024600), DTY (54023310), FDY (54024700) and textures yarn (54023390) are all affected by the anti-dumping, while polyester industrial yarn is excluded.

In 2020, China exported 267kt of PFY to Vietnam and ranked the third place, with 248kt covered in the anti-dumping, mainly FDY and DTY and some POY and textured yarn.

Exports of PFY to Vietnam saw a big reduction in 2020 compared with 2019, mainly POY, FDY and DTY, which was closely related to the startup of 200kt/year PFY unit from Vietnam Billion in end-2019. Vietnam presented obviously falling dependency on Chinese PFY after Billion’s plant commissioned operation.

Under such circumstance, Chinese companies were not surprised on Vietnam’s launch of anti-dumping investigation on Chinese PFY, while they were astonished by the gap of tax rate among enterprises. For companies to be imposed by high anti-dumping duty, their export business to Vietnam will be directly impacted, while for the enterprises with low anti-dumping duty, the levy of anti-dumping duty is anticipated to lift their competitiveness to a certain extent.