India raises anti-dumping duty on Chinese untreated fumed silica
India on Tuesday increased the anti-dumping duty on Chinese untreated fumed silica after finding evidence that the firm in question was absorbing the duty. The Directorate General of Trade Remedies (DGTR) issued the order after concluding that Chinese exporter Shandong Dongyue Silicone Material had been absorbing the existing anti-dumping duties on untreated fumed silica exports to India, effectively nullifying the protective measure.
As a result, the DGTR recommended an increase in the duty to $1,296 per metric tonne for the company, a significant jump from the earlier $1,018 per metric tonne.
The higher duty on the Chinese company is expected to raise the landed cost of Chinese fumed silica in India, potentially benefiting domestic producers. Until this DGTR orders are challenged and a reverse outcome obtained, higher duties will apply.
The DGTR move follows a detailed anti-absorption review investigation initiated on December 31, 2024, after domestic manufacturer Cabot Sanmar Limited alleged that the Chinese exporter had reduced its prices to offset the anti-dumping duty imposed in November 2021.
The original anti-dumping duties on untreated fumed silica imports from China PR and Korea RP were imposed in November 2021, following a 2020 investigation that found evidence of dumping and injury to Indian producers.
For Shandong Dongyue, the duty was set at $1,018/MT for a five-year period.
The product — a synthetic amorphous silica used in silicone sealants, coatings, adhesives and pharmaceuticals — is considered vital for multiple manufacturing sectors.
The DGTR’s final report said during the review period (July 2023-June 2024), Dongyue’s export prices to India dropped by 30.5 per cent, a steeper fall than its cost of sales (down 22.7 per cent) and even the price decline in other export markets (24.1 per cent).
Commerce Ministry sources said the investigation also found that while raw material and utility costs for the industry increased — in some cases by over 18 per cent in USD terms — Shandong’s prices to India fell sharply, suggesting an intentional strategy to neutralise the effect of the duty.
“The facts on record clearly establish that the anti-dumping duty in force has been absorbed by the said exporter by reducing the price,” the DGTR concluded.
During the probe the Chinese exporter claimed that price reductions were driven by global oversupply, softer demand post-Covid and exchange rate fluctuations, rather than any attempt to absorb duties. It also argued that its product was of lower commercial value compared to other grades in the market.
Indian firm Cabot Sanmar countered that the price drop in India was significantly greater than in other countries and not supported by global cost trends. The DGTR agreed with this assessment, noting that Shandong did not provide sufficient third-country trade data to back its claims.
Post the conclusion under the lesser duty rule, the DGTR recommended revising the anti-dumping duty for Shandong Dongyue to $1,296/MT.
Duties for other Chinese producers — except Wacker Chemicals Fumed Silica (Zhangjiagang), which continues to have zero duty — remain unchanged. Korean producer OCI also retains a zero-duty status.
The modified duties will remain in force until November 10, 2026, aligning with the original five-year duration set in 2021.
Sources said as a next course of action, importers and exporters affected by the decision can appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).
“However, until any appeal changes the outcome, the higher duty is expected to raise the landed cost of Chinese fumed silica in India, potentially benefiting domestic producers,” sources said.
India