KUCHING: South Korea’s anti-dumping duties imposed on Malaysian plywood will be extended for another three years if its Finance Minister endorses the recommendation from the Korean Trade Commission (KTC).
The KTC made the anti-dumping duties’ extension decision in late May following a three-month review of business practices by importers and suppliers of plywood products. The Finance Minister will make a decision within 50 days on receipt of the KTC’s recommendation, according to Korea’s Yonhap New Agency.
The agency said the new anti-dumping duties over the next three years would range from 3.08% to RM38.10%.
It is understood that Sarawak plywood suppliers had strongly objected to any move to extend the anti-dumping duties when they responded to a set of questionaires from South Korean authorities carrying out the review.
The previous three-year anti-dumping duties levied on Malaysian plywood in February-2011 were from 5.12% to 38.1%. Eight major Sarawak plywood manufacturers and exporters and one Sabah exporter were slapped with the duties following complaints by Korean Wood Panel Association that these foreign suppliers were selling their products at unfairly low prices, thus hurting the local plywood makers.
The affected Sarawak companies were Jaya Tiasa Timber Products Sdn Bhd (with 6.43% duties imposed), Subur Tiasa Plywood Sdn Bhd (5.12%), Hwa SengVeneer and Plywood Industry Sdn Bhd (6.43%), Shin Yang Plywood Sdn Bhd, Forescom Plywood Bhd, Menawan Wood Sdn Bhd, Shin Yang Plywood Bintulu Sdn Bhd and Zedtee Plywood Sdn Bhd (all 9.75%). The highest duties of 38.1% was levied on Sabah-based Sinora Sdn Bhd while all it was 8.76% on all other Malaysian suppliers.
The previous anti-dumping duties, according to a Sarawak leading plywood exporter, were imposed on panel products of at least 6mm in thickness. Products below that thickness are not affected.
The KTC was quoted as saying that local companies had requested for an extension of the anti-dumping duties on July 31,last year, claiming that the imposition of the punitive duties had led to a sharp drop in imports of Malaysian plywood but that damage to the local industry would recur if the punitive measures were lifted.
According to Yonhap, South Korea’s market for plywood was worth US$781.5mil last year, with local manufacturers supplying about 25% of the total and Malaysian manufacturers 12%.
In a report yesterday, RHB Research Institute predicted that South Korea could reimpose the anti-dumping duties on Malaysian plywood as early as end-July.
“Timber companies that export plywood to South Korea could see a slowdown going forward (due to re-iimposition of the anti-dumping duties)” it said.
The research house said Jaya Tiasa Holdings Bhd’s plywood export to South Korea fell to as low as 5% of its total sales from 43% in the previous quarter when the duties were first imposed in 2011 but sales picked up to 10%-20% in subsequent quarters.
However, it said Jaya Tiasa had managed to increase its plywood volume to other markets, like Taiwan, the Middle East and US, to offset the lower volume exported to South Korea.