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anti-dumping Citric Acid

The European Union has announced the decision as it imposed an anti-dumping duty rate from 13,2 – 49,3% on Chinese imports of citric acid after an investigation concluded two European producers have been injured by unfair competition.

Company Jungbunzlauer  alleges that Chinese citric acid producers have benefited from government subsidies (please see below our sentence regarding agricultural subsidy for company Jungbunzlauer)  and loans, allowing them to sell citric acid at prices too low for European firms to recover their costs. From 04.06.2008 provisional anti-dumping on Chinese imports of Citric Acid has already started.
6 months after starting of provisional anti-dumping there will be final decision and the regulation will be valid for up to 5 years. During the first 6 months, all involved people can send them their concerns and suggestion.  Also during the first 6 months all importers have to pay below mentioned provisory anti-dumping duty. If the final decision of anti-dumping committee would be to cancel the anti-dumping duty, it would be possible that the provisory anti-dumping duty will be paid back to importers.

Company

anti-dumping duty

Anhui BBCA Biochemical Ltd Co. Ltd

42.2 %

DSM Citric Acid (Wuxi) Ltd 

13.2 %

RZBC Co.

43.2 %

RZBC (Juxian) Co. Ltd.

43.2 %

Shandong TTCA 

49.3 %

 Yixing Union Biochemical

38.8 %

Laiwu Taihe Biochemistry Co. Ltd

40.8 %

Shanxi Ruicheng

40.8 %

Weifang Ensign Industry Co. Ltd

40.8 %

all the other  sources

49.3 %

     
Demand for the ingredient is growing thanks to new applications and emerging markets. In Europe consumption increased by 15 per cent between 2004 and the investigation period to around 440,000 tonnes, according to the EU.
But while European production of the ingredient has increased slightly to meet new demand, its overall market share has shrunk by 9 per cent. Meanwhile, imports from China have increased by 37 per cent to 198,000 tonnes. Chinese producers undercut European prices substantially, at an average rate of 15 to 21 per cent of the Europe price, investigators found.

Only two Europe-based citric acid producers supply the market, including Austria's Jungbunzlauer who brought the case to the attention of the EU authorities and Belgium's SA Citrique Belge, owned by Dutch chemicals group DSM. Their profitability has declined as small price rises have been "insufficient for the community industry to maintain its profit margin" in the face of significant raw material increases, said the report in the EU's Official Journal.

Anti-dumping duty for import of citric Acid of Company DSM Citric Acid (Wuxi) Ltd located in China is the lowest. But refer to information from other Chinese producers company DSM Citric Acid (Wuxi) Ltd has stopped with production short time after visiting of investigators from EU.

According information of insiders, company Citrique Belge even stopped or Reduced production dramatically during last 3 years. Most of their citric acid were imported from their factory in China (DSM Citric Acid (Wuxi) Ltd).

"In view of the clearly established coincidence in time between, on the one hand, the surge of dumped imports at prices significantly undercutting the Community industry's prices and, on the other hand, the Community industry's decrease of profitability and deterioration of the other financial indicators, it is provisionally concluded that the dumped imports played a determining role in the injurious situation of the Community industry," it concluded.

Both of the European citric acid producers have publicly commented on announcement on 4th of June.


The actual result of anti-dumping is, that duringthe last two months price of citric acid has increased additionally to anti-dumping duty for more than 20%.

Accordingly The price for soft drinks, Detergents etc will increase.

p.s. Company Jungbunzlauer have got from 16.10.2006 to 15.10.2007, 1.856.758,88 EUR agricultural! subsidy from EU.
(please see : http://www.transparenzdatenbank.at/trans/see.through?init )

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