China's citric acid and citrates highly rely on exportation. The international market plays a decisive role in the adjustment of citric acid's production capacity in China. However, the constant trade remedy actions taken by oversea market on Chinese citric acid and citrates destroy the export environment of Chinese citric acid enterprises. Traditional export markets are been gradually blocked.
In 2007 and 2008, China's citric acid has gone through a series of trade remedy investigations done by our main export partners like South Africa, European Union and the United States. Those investigations have a large influence on the export of our citric acid. In 2011, Brazil also launched a series of anti-dumping investigations on China's citric acid and citrates, which results in another reduction of export quantity at higher price.
European Union and the United States are traditional and major export market for Chinese citric acid. While in recent years, China's exportation of citric acid to those markets have a clear reduction because of their high anti-dumping duty.
Since the cost of craft, raw material and labors in the production of citric acid in China is relatively low, the price of citric acid is pretty competitive in the global market. While after the trade remedy measures, the anti-dumping duty in European Union is 42.7% and in the USA is almost 165% together with anti-subsidy duty, which sharply weakens the price advantage of Chinese citric acid to European Union and the United States.
After the market being blocked by some developed countries like European Union and America, some enterprises in China start to open up new overs sea market. In 2009, India takes the place of the United States, being the first largest export market for citric acid. In recent years, the major export markets for citric acid are some emerging economies. While due to many similarities between China and these emerging economies, the price advantage in those markets is not so obvious, so the competition becomes more and more fierce. Moreover, in 2011 and 2012, our citric acid again encounters the anti-dumping investigation done by Brazil and Ukraine, which will further worsen the export environment.