(Yicai Global) Sept. 7 -- China has accused the United States of dumping polyphenylene ether in its home market, following a preliminary ruling by the Ministry of Commerce yesterday.

The ministry said the dumping substantially harms China’s domestic polyphenylene ether industry and it will impose sanctions on importers, charging them a security deposit, according to a statement posted on its website yesterday.

From today, importers must pay China Customs a security deposit at a certain percentage for importing from US firms products under investigation. The rate for SABIC Innovative Plastics US is 18.3 percent, while it is 48.6 percent for other American companies.

Polyphenylene ether is a common high-strength engineering plastic, widely used in photovoltaics, autos, communications, electronic appliances, water treatment, and medical equipment. China produced 103,300 tons in 2019, but demand reached 143,900 tons, according to data.

According to China Customs statistics, the volume of dumped imports continued to increase during the damage investigation period, the ministry said. The volume rose from 17,271 tons in 2017 to 19,614 tons in 2018 and 21,848 tons in 2019, up 13.6 percent from 2017 to 2018, 11.4 percent from 2018 to 2019, and 26.5 percent from 2017 to 2019.

The imported products have forced down the prices of domestic products, per the ministry.

The prices of dumped imported products fell for six straight quarters from the third quarter of 2018 to the fourth quarter of 2019, falling to their lowest during the investigation period in the last quarter of 2019. This was down 14.5 percent from the second quarter of 2018, the ministry added, saying the big price decline had a severe impact on the domestic market.

Editor: Peter Thomas