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Insight | Time: Oct 15 2020 10:08AM
More MEG to China after EU ADD measures?
 
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**About the rumor that EU ADD on MEG from US and KSA will result in more cargoes to China

There was a rumor last night that the European Commission will impose anti-dumping duty imports of mono ethylene glycol originating in the United States of America and the Kingdom of Saudi Arabia starting from October 21, 2020. Some said the ADD levy would end the MEG exports from the United States of America and the Kingdom of Saudi Arabia to Europe, and more exports would turn to Asian market, especially China. Therefore, Asian MEG prices would be greatly affected by the ADD measures.

However, this was a misinterpretation for the actual measures.

The European Commission issued the Notice of initiation of an anti-dumping proceeding concerning imports of mono ethylene glycol originating in the United States of America and the Kingdom of Saudi Arabia on October 14, 2020.


The Commission may carry out visits between the above stated dates to verify the questionnaire replies and other information submitted by the interested parties. So, the timing of imposing ADD duty starting from October 21 is incorrect.

Latest date for entry into force of provisional measures (8 months from initiation in anti-dumping cases and 9 months from initiation in anti-subsidy cases). If imposed, these measures have a maximum duration of 6 months in the case of an anti-dumping investigation and 4 months in the case of an anti-subsidy investigation.

There are still 8 months before the Commission carry out provisional measures, and it will take a long period to ship cargoes to China. Meanwhile, European buyers may also purchase in advance before the measures come into effect.

If imposed, European buyers could also choose MEG cargoes originated from Canada and Kuwait. In addition, if the arbitrage window is opened, some Chinese cargoes could also be also exported to European market.
[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
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