With effect from July 1, 25% tariff cut on S Korean PTA, PET exports to EU

11-Jul-11

South Korean purified terephthalic acid (PTA) and PET bottle chip exports to the European Union are enjoying a 25% cut in import tariffs, with effect from July 1, as its free trade agreement with the continent takes effect as per Platts. Before the FTA, a 6.5% customs duty was levied on South Korean PTA and PET exports to the EU. Under the FTA, the duty will be reduced in four equal annual stages until it is totally eliminated. This means that South Korean PTA and PET import duty to the EU starting July will be at 4.875%. For now, South Korean PTA makers do not expect to see any increase in exports to Europe. South Korean origin PTA tends to be around US$10-15/mt lower than that of Taiwan origin cargoes because of antidumping duties imposed by China. Including a freight cost of US$90/mt and 4.875% import tariff, this means the South Korean cargoes would arrive in Northwest Europe at around $1,253/mt.