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Trade War: Listed vitamin producers ensure no effect on the industry yet

2018/4/26 17:03:11

While the China-US trade war is raging on, vitamin players worldwide are expressing worries about a potential decline in vitamin exports from China. However, the Chinese major enterprises have given their comments, ensuring their exports to the USA are not affected yet.




China announced recently its decision to impose new tariffs on 128 imports from the United States in response to the new tariffs on steel and aluminium, announced by Donald Trump, that took effect at the end of March. The list of US products that are subject to new tariffs is worth around USD3 billion, raising the concern of market players that are doing business in China and the USA. As China is one of the main vitamin production bases in the world, vitamin enterprises have repeatedly expressed concerns towards Chinese manufacturers

 

According to trade intelligence firm Tranalysis, China exports mainly active pharmaceutical ingredients (APIs), such as precursors and intermediates, to the USA, including APIs of antibiotics, vitamins, and antitumour medicines. In the entire 2017, the USA imported USD4 billion worth of APIs from China, becoming China's second largest API export destination. China is a major exporter of vitamin APIs. Nearly 80% of its vitamin production is for export, of which the USA holds the predominant share as a market destination.

 

The recent China-USA trade war has led to widespread concerns among investors over vitamin exports. In response, some of the listed vitamin-producing companies have reacted correspondingly. Tranalysis has summed up the major statements.

 

Xiamen Kingdomway

Europe and the USA are both important export destinations of the company. However, the main product exported to the USA is coenzyme Q10, whose prices are highly competitive internationally. Therefore, it is not likely that the China-USA trade war will have an impact on export volumes.

 

Zhejiang Garden Biochemical

The impact of the trade war is none too little, given the competitiveness of their products, mainly vitamin D3, and the fact that they are not on the list of Chinese imports subject to new tariffs. They export the products predominantly to Europe and America, where their export value accounts for more than 60% of the company's total revenue.

 

Zhejiang NHU

Over 30% of this company's total exports are to the USA However, vitamins are not subject to the new tariffs.

 

In 2017, China's vitamin output reached 290,000 tonnes, more than 70% of the global total. Europe has become China's largest vitamin export market, followed by North America. Last year, European vitamin producers tended to purchase feed-grade vitamins from China, focusing on high-end vitamins. Due to this trend, China exported approximately 40% of the total export volume of vitamins to Europe, whereas the share of the USA was about 22%. The potential decrease in the volume of the import to North America may be offset by the rising demand for vitamins from the European market. Generally, the China-U.S. trade war will, therefore, have a limited influence on China's vitamin exports.

 

In addition, it is expected that the USA will not likely impose higher tariffs on APIs, which constitute China's major export pharmaceutical commodity to the USA and are necessary for the production of final products by the USA pharmaceutical enterprises. Moreover, APIs production consumes large quantities of energy and generates much pollution.

 

About the article

Tranalysis is one of China’s leading trade intelligence firms, providing import and export analysis of thousands of commodities, including vitamins and mineral. Keep a clear picture of the trade dispute by China and the USA with the trade reports of Tranalysis.

 

To get access to the latest trade data of vitamins, please go to our online shop or contact our team directly at econtact@tranalysis.com.

 

Take part in the discussion by joining our groups on LinkedIn and Facebook.

Follow Tranalysis on Twitter: @Tranalysis2001


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