Benzinga - by Natan Ponieman, Benzinga Editor.
China has taken a new step in the ongoing economic battle with the west, launching a new anti-dumping probe of plastics made in the U.S. and the European Union.
The move can be read as a possible retaliation against recent protectionist measures by Western countries, including a recent increase of tariffs on Chinese imports led by President Joe Biden.
The Chinese probe was announced on Sunday by the country's commerce ministry, looking into imports of polyoxymethylene copolymer, a type of plastic widely used in consumer electronics, household items, car parts as well as in industrial applications.
Public companies manufacturing this material include Celanese Corporation (NYSE:CE), BASF SE (OTC:BASFY), DuPont de Nemours, Inc. (NYSE:DD), Mitsubishi Chemical Holdings Corporation (OTC:MTLHY), Asahi Kasei Corporation (OTC:AHKSY) and SABIC (Saudi Basic Industries Corporation) (OTC:SABRY).
Over the next year, China will look into imports of the chemical, also known acetal or POM, coming from the U.S., Japan, Taiwan and the EU, in efforts to find out if imports are being priced at equal levels to their domestic markets.
In an anti-dumping probe, a country will try to assess whether companies from a different country are pricing items at lower prices in order to gain market share and take out the local competition.
The probe could be extended for a period of six months after the one-year period is completed.
Also read: Chinese EV Maker Li Auto Misses Q1 Revenue Expectations Despite Surging Vehicle Sales, Stock Tanks
Is China Striking Back? Biden's measures from last week struck a nerve in China as the U.S. government pushed forward a plan to further protect U.S. manufacturing jobs by imposing higher tariffs on Chinese goods.
The heavy taxes include a 25% tariff on Chinese steel and aluminum, a new 100% tariff on Chinese electric vehicles, a 25% tariff on EV batteries and critical minerals, upsized tariffs on Chinese solar panels, raised from 25% to 50%, and a new 50% tariff on semiconductors made in China.
The move is said to directly benefit U.S. carmakers Ford Motor Co (NYSE:F) and General Motors Co (NYSE:GM).
Biden's recent measures are part of an all-out campaign to attract undecided voters by pushing protectionist measures aimed at safeguarding U.S. jobs and industrial capabilities. His GOP opponent Donald Trump, who has boasted the more protectionist, anti-China discourse in recent years, maintains a one-point lead, according to the most recent polls.
EU Eyes Chinese EVs, Steel, More: Biden's new tariffs build on previous ones imposed by Trump during the previous White House administration. The new tariff announcement synced with another blow to Chinese international commerce coming from across the Atlantic.
The European Commission, which is the executive arm of the European Union, is halfway through a probe looking at whether the bloc should impose tariffs on Chinese electric vehicles, following the example of the U.S.
Last week, the EU announced several new probes aimed at finding out whether Chinese companies are benefiting from state subsidies that could allow them to market cheaper products in Europe, therefore displacing European companies.
The investigations, being carried out by the European Commission, are centered on iron or steel products coming from China, as well as wood flooring and medical devices.
Several Chinese products associated with the production of clean energy, including wind turbines, solar panels, are also being researched by the bloc, according to Reuters.
Now read: ‘Oh My Word:’ Tesla FSD Wows Boris Johnson As It Drives His Family Around ‘Hair-Raising’ LA Roads; Ex-UK Leader Reveals New Feature In Works
Shutterstock illustration.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.