A Chinese trade group official recently accused foreign resin makers of dumping plastic resin in China and "severely disturbing the market."

A recent report from the Chinese-language financial newspaper 21CBN quoted unidentified "industry insiders" as saying that Chinese resin makers are preparing to request anti-dumping investigations.

The report pointed a finger at South Korean resin producers, especially LG Chem, SK Chem and Samsung. In September, South Korean-made resin accounted for 33 percent of China's total monthly PP import, 20 percent of its total polyethylene import, and 64 percent of polystyrene import. The South Korean prices were significantly lower than Chinese domestic market prices: about 700-3,500 yuan per metric ton (US$0.05-0.23 per pound).

In October, LLDPE imports averaged 8,511 yuan per metric ton ($0.56/pound), 8 percent lower than Chinese domestic market prices. PP imports averaged 7,234 yuan per metric ton ($0.50/pound), 16 percent lower than Chinese prices.

Price gaps are even wider for feedstocks such as propylene.

As a result, China's domestic resin companies are cutting back production. In October, PVC output dropped 33 percent and 49 of the 97 PVC resin producers in the nation ceased production.

China's major resin producers, Sinopec and PetroChina, both primarily state-owned, said their petrochemical derivatives businesses took a huge loss in October.

South Korea, itself, is also trimming resin production, but Chinese companies complain that South Korea is taking advantage of its depreciating currency to dump products overseas.