Yarn merchants reject new customs valuation ruling

Yarn merchants reject new customs valuation ruling

The Pakistan Yarn Merchants Association (PYMA) has officially rejected the new valuation ruling for polyester filament yarn (PFY) issued by the customs authorities, terming it as “unjust” and not reflective of the current global market prices.

The controversial Valuation Ruling No. 1355/2019, dated March 15, 2019, has been challenged under section 25-D of the Customs Act, 1969. Yarn Merchants Association has lodged a formal request for the customs valuation department to review and revise the ruling based on the significant discrepancies highlighted by the association.

According to a statement released by PYMA on Sunday, the association has expressed strong reservations about the valuation ruling, stating that it is considerably higher than the actual market prices of PFY. PYMA representatives have provided evidence indicating that global PFY prices have sharply declined, a fact that is readily verifiable through various international sources that track polyester raw material prices.

The spokesperson for PYMA highlighted a critical issue with the valuation methods used, specifically pointing out errors in the calculation of Monoethylene Glycol (MEG) — a key component in PFY production. The association claims that the customs valuation department’s assessment of MEG was incorrect and did not align with current market conditions.

Over the past decade, PYMA has adhered to a practice of submitting raw material price data for the last 90 days to aid accurate valuation rulings. However, PYMA officials have expressed disappointment that their submitted data was seemingly ignored in the recent assessment. Moreover, they criticized the lack of stakeholder consultation prior to the implementation of the new ruling, which they argue is a departure from standard procedural fairness.

In response to these issues, PYMA has demanded the withdrawal of the current valuation ruling and the issuance of a revised ruling after comprehensive consultation with all relevant stakeholders. The association has also expressed its willingness to provide additional modifications to ensure that the new valuation ruling accurately and fairly reflects the true prices of PFY.

This dispute comes at a critical time for the textile industry in Pakistan, which relies heavily on accurately priced raw materials to remain competitive in international markets. The outcome of this challenge could have significant implications for the pricing structure within the country’s textile sector and its global trade relationships.

PYMA’s call for a review is seen as a move to ensure fair trade practices and to protect the interests of yarn merchants and the broader textile industry in Pakistan. The customs authorities have yet to respond to PYMA’s demands, and the industry is closely watching for any developments on this front.