India prepares for capacity additions of PTA in 2015; imports to decline by the end of Q3 – 8 Jan 2015

Import volumes of PTA into India (which have a big and growing polyester industry in Asia) are expected to decline after the commissioning of some new units in 2015. A new plant with 1.1m tone per annum capacity is expected to go live in 2015. The plant is to be operated by Reliance Industries Ltd. JBF Petrochemicals Ltd, is also expected to commission its purified terephthalic acid (PTA) plant in Mangalore SEZ by mid of 2015 which will have 1.25 million metric tonne per annum capacity, thus accounting for the fresh capacities this year.

Currently PTA attracts a provisional anti-dumping duty in the range of $19.05-117.09 per tonne (3-14%, effectively) for imports from China, South Korea, Thailand and the European Union up to April 2015, on top of the 5% import duty. With recent antidumping duties (ADDs) being imposed on PTA imports into India, buyers will also be reluctant in purchasing cargoes from overseas, especially with domestic prices of PTA keeping at almost similar levels to import prices.

Import volumes into the country are expected to fall off to around 480,000 tonnes/year in 2015, compared with around 850,000 tonne/year estimated for 2014. According to the sources, in 2014, India’s PTA imports had gradually declined on a monthly basis, from 85,000-89,000 tonnes in July to 75,000 tonnes in August, and to 62,000-65,000 tonnes in September.

India domestic market has also come under pressure in an array of weak conditions in the global macroeconomic front, downstream markets and limited availability of credit in a tough economic environment.