AN OVERSUPPLY of petrochemical products has depressed demand for high-density polyethylene (HDPE), JG Summit Olefins Corp. told the Tariff Commission.
“It is because of the current petrochemical downturn. We are now at the period of oversupply especially for polyolefins including HDPE,” JG Summit Olefins representative Maria Veron M. Marasigan said in a Tariff Commission hearing on Tuesday.
“This has contributed to the decreased overall consumption,” she added.
In 2022, the Department of Trade and Industry imposed three years of safeguard duties on imports of HDPE pellets and granules to protect domestic industry.
The government imposes a safeguard duty of P1,271 per metric ton of imported HDPE pellets and granules. The current most favored nation rate on HDPEs is 10%.
Ms. Marasigan said that the oversupply has also affected regional markets.
She said the company’s HDPE sales rose 15% last year, giving JG Summit Olefins a 50% market share.
“In the three-year period, there has been an improvement between 2022 to 2023, in terms of market share in HDPE,” Ms. Marasigan added.
JG Summit Olefins, which merged with JG Summit Petrochemical Corp., had been the main proponent of safeguard duties on imported HDPE pellets and granules.
The company narrowed its net loss to P12.9 billion in 2023.
The company is the lone domestic manufacturer of HDPE pellets and granules. — Adrian H. Halili
