EU charges Taiwan with dumping high-tenacity yarn polyester

Taipei, Feb. 6, 2004 (CENS)--European Union (EU) recently charged Taiwanese makers of high-tenacity yarn polyester with dumping their products in the European market, the first such charge ever met by domestic makers in the line.

The firms accused include Far Eastern Textile Co. and Shinkong Synthetic Fiber Corp. Both companies said the dumping charge has little influence on their operations and they would employ lawyers to counterattack.

An emerging textile product, high-tenacity yarn polyester has a wide range of applications. The product can be used for the production of tyre fabric, automobile seat belt, weaving floor textile, and transmission belt. Taiwan has strong international competitiveness in the production of the item.

To avoid price competition launched by mainland Chinese rival firms, domestic textile firms have stuck to a product differentiating strategy over the past several years. Far Eastern and Shinkong have carried out the strategy for a long period of time and have been continually expanding production of industrial yarns to boost international competitiveness.

In the past, Taiwan's textile products facing dumping charges were mostly the polyester textured yarn and polyester staple fiber.

Since 2001, Taiwan has started massive exports of high-tenacity yarn polyester to EU nations. Exports of the product to EU nations momentously increased to 5.2 million kilograms in 2002 from the previous year's 2.55 million kilograms. In the first 11 months of last year, the export volume rose further to 7.24 kilograms.

Despite the substantial increase in export volume, domestic manufacturers of the product have seen volatile export prices for the product over the past few years. The average export price of the product was US$1.33 per kilogram in 2002, down 17% from the previous year's US$1.6. The average price rebounded to US$1.43 last year.

An industry insider said domestic firms makers of high-tenacity yarn polyester are above the dumping practice because they are reluctant to sell the newly developed product at prices lower than production costs.

As the EU's dumping charge is focused on domestic industrial yarn for the first time ever, a domestic manufacturer in this line calls for domestic firms to take cautious actions to develop marketing channels and make all-out efforts to diversify export markets.