DTI imposes safeguard duty on polyethylene imports

FREEPIK

THE DEPARTMENT of Trade and Industry (DTI) ordered the imposition of safeguard duties on imports of high-density polyethylene (HDPE) pellets and granules for three years in a bid to protect the local industry.

In Department Administrative Order (DAO) No. 22-13 dated Sept. 30, the DTI said the safeguard duty will be slapped on imported HDPE pellets and granules from various countries “to implement the adjustment plan of the local HDPE industry within that period.”

For the first year, a safeguard duty of P1,338 will be slapped on each metric ton (MT) of HDPE pellets and granules. This will go down to P1,271 per MT for the second year, and to P1,208 per MT for the third year.

HDPE resins are used in consumer and industrial packaging.

DTI-Bureau of Import Services Director Maria Guiza B. Lim said in a Viber message that safeguard duties will be imposed on imports from countries such as Thailand and Malaysia.

The DTI’s decision comes after the Tariff Commission (TC) in June recommended safeguard measures against HDPE imports.

The TC had noted a “sudden, sharp and significant enough” increase in the volume of imports of HDPE pellets and granules beginning the first half of 2021.

“There exists an imminent threat of serious injury and significant overall impairment to the position of the domestic HDPE industry in the near future,” the TC said, citing the high likelihood that HDPE imports will continue to spike in the near future.

It also cited the “substantial freely disposable production capacities of top suppliers Malaysia, Thailand, Singapore and Indonesia,” as well as the significant deterioration in the overall position of the domestic HDPE industry during the surge in imports.

“While the DTI is mandated to protect consumers, there is a need to balance this with other sectors such as investors and industries which provide employment to Filipinos,” the department said in the DAO.

The DTI said users of HDPE pellets and granules will still be able to choose between the local and imported products.

“The imposition of the safeguard measure will only be temporary and is not expected to cause shortage of HDPE pellets and granules in the domestic market considering that the HDPE manufacturer has sufficient capacity to meet domestic demand,” the DTI said.

JG Summit Olefins Corp. (JGSOC), which merged with JG Summit Petrochemical Corp. (JGSPC), had sought the imposition safeguard duty on imported HDPE pellets and granules.

JGSOC is the lone domestic manufacturer of HDPE pellets and granules, which are used for film extrusion process, injection molding process, blow molding process, pipe extrusion process, and monofilament extrusion process. — Revin Mikhael D. Ochave