Beijing ups trade tensions with new measures on US chemical

Styrene is the building block of many plastics, used to make foam packaging and many disposable plastics. (AFP)
Updated 13 February 2018
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Beijing ups trade tensions with new measures on US chemical

BEIJING: Trade tensions between the world’s two largest economies continued to simmer as Beijing took aim at imports of a key chemical from the US, the latest move in a growing standoff between the pair.
China’s Ministry of Commerce announced Tuesday it had found dumping of styrene imports from the US, Taiwan and South Korea in an initial ruling of an ongoing trade investigation into the chemical.
Dumping, or selling goods at unfairly low prices abroad, can undercut domestic markets at the expense of local industries.
“Mainland China’s styrene industry has suffered substantial harm,” China’s commerce ministry said in a statement, adding that dumping was the cause of this harm.
The initial ruling called for importers to place anti-dumping deposits of five to 10.7 percent with China’s customs administration.
Those deposits will be applied to tariffs if the commerce ministry decides to levy duties in a final ruling.
Styrene is the building block of many plastics, used to make foam packaging and many disposable plastics.
Last year, China imported 3.2 billion kilograms of the chemical from the US worth more than $4 billion.
The measures come a month after the Trump administration launched new tariffs on Chinese-made solar panels and washing machines.
Those tariffs followed a raft of new trade cases against China during Trump’s first year in office, which have rattled Beijing.
Last week, China expressed concern over the ramping up of trade investigations by the US.
Analysts say Beijing is signaling it will take action in a tit-for-tat trade war.
Last week it launched an anti-dumping investigation into sorghum imports from the US, worth almost $1 billion last year.
That was a sliver of the $14 billion in US soybean imports, which a Chinese commerce ministry spokesman also hinted could be in Beijing’s crosshairs.
Soybeans are America’s largest export to China.
The Trump administration has put leveling the trade playing field near the top of its agenda for Sino-US relations.
But in Trump’s first year as president the trade deficit swelled to a record high of $375.2 billion by the US’s counting.


Saudis cut, Russians hiked output ahead of pact: IEA

Updated 59 min 44 sec ago
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Saudis cut, Russians hiked output ahead of pact: IEA

  • OPEC members along with allies including Russia agreed in early December to trim production by 1.2 mbd from Jan. 1

PARIS: Saudi Arabia demonstrated its resolve to lift oil prices by slashing output ahead of the entry into force of new pact limiting production while Russia boosted output to a record level, the International Energy Agency said Friday.
World oil markets have been on a rollercoaster ride in recent months, with OPEC and its partners including Russia, often called OPEC+, agreeing to cut back production again from January in order to reverse a slump in oil prices on abundant production and worries about slower global growth.
In its latest monthly report, the Paris-based International Energy Agency said the Saudis took the lead by cutting output in December as prices tumbled by more than a third in just two months.
“Recently, leading producers have restated their commitment to cut output and data show that words were transformed into actions,” said the IEA.
“While Saudi Arabia is determined to protect its price aspirations by delivering substantial production cuts, there is less clarity with regard to its Russian partner,” it added.
But the cut was mostly due to the Saudis, with data indicating several OPEC members increased production last month.
The IEA said data show that Russia increased crude oil production in December “to a new record near 11.5 mbd (million barrels per day) and it is unclear when it will cut and by how much.”
OPEC members along with allies including Russia agreed in early December to trim production by 1.2 mbd from Jan. 1, in a bid to eliminate a production glut and shore up prices.
Just months earlier, they had relaxed production caps as prices shot higher on market worries about the impact of US sanctions on Iran, but Washington eventually granted waivers allowing several countries to continue to import Iranian oil.
Meanwhile, US production rose considerably more than expected last year, adding further to supplies, while concerns about demand emerged as the US-China trade spat deepened in the second half of last year.
The IEA said the US increased output by 2.1 mbd last year, the “highest ever” annual growth ever recorded.
The boom of shale oil production in the US this decade has redrawn the map of global energy politics as the nation no longer depends as heavily on imports and has even resumed exports.
The IEA said “the US, already the biggest liquids supplier, will reinforce its leadership as the world’s number one crude producer” in 2019.
“By the middle of the year, US crude output will probably be more than the capacity of either Saudi Arabia or Russia.”
The IEA left its estimate for global oil growth in 2019 unchanged at an increase of 1.4 mbd, saying “the impact of higher oil prices in 2018 is fading, which will help offset lower economic growth.”
It said there were signs that the rebalancing of the oil market will be gradual.