INDONESIA – A number of domestic food and beverage manufacturers are calling on the Indonesian Antidumping Commission (KADI) to halt its anti-dumping investigations into plastic PET packaging material imports from China, South Korea, Singapore and Taiwan.
The antidumping agency had started its investigation on 29 June 2012 following a petition by representatives of the domestic plastic industry – including PT Indorama Synthetics Tbk, PT Indorama Ventures Indonesia and PT Polypet Karyapersada (all of which belong to the Indorama group) – which claim that PET imports from China, South Korea, Singapore and Taiwan are at dumped prices, affecting business for the domestic plastic industry.
However, Indonesian Food and Beverage Business Association (GAPMMI) secretary general Franky Sibarani question the validity of the petitioners’ claims: “The investigation lacks the minimum preliminary evidence as no parties have suffered losses from the import of PET. Thus, the probe must stop.”
He claimed that some of the plastic producers who support the investigation have themselves imported PET from South Korea, one of the export countries in question.
Sibarani warned that if the investigation leads to the imposing of an anti-dumping duty, known in Indonesia as BMAD, it will increase the brand owners’ production costs and eventually lead to a rise in food and beverage prices.
“The PET component in food and beverage products is around 20-80% of production costs. Bottled water is the most affected as the PET component accounts for 70% of production cost,” he noted.
Rahmat Hidayat, vice chairman of GAPMMI, added, "We have made a calculation, if BMAD for PET is set at 10%, it will increase the production cost by 10 -15%."
Not only will this affect domestic consumers, it will also make Indonesian products less competitive, particularly with the ASEAN Economic Community (AEC) near its implementation date in 2015, said Sibarani.
GAPMMI says that the food and beverage industry contributes 10% of Indonesia’s GDP annually.
According to Hendro Baroeno, head of the Indonesian Association of Bottled Drinking Water Companies (ASPADIN), PET packaging material imports are essential to Indonesia. In 2013, domestic PET demand was 177,000 tons while domestic PET production was 467,000 tons, but he noted, “250,000 tons of domestic production is exported, leaving 167,000 tons for domestic use. That means we need an extra 10,000 tons from imports.”
KADI says it is still continuing its investigations though, and expects to have its final report ready by November. Based on the report, the Trade Ministry will then decide whether an anti-dumping duty on PET imports should be imposed.