Citric Acid Prices in the USA Surge Amidst Global Demand and Supply Shortages

November 2023 witnessed a tumultuous ride in the Citric Acid market in the United States as prices soared due to increased international demand. A confluence of factors, including restocking activities, heightened end-user industry demand, and a shortage in China's Citric Acid supply, led to a surge in prices during the recent holiday season. The escalating demand for Citric Acid in the global market triggered a domino effect on prices in the USA, as manufacturers and suppliers sought to replenish inventories. The food and beverage, as well as the nutraceutical industries, played a pivotal role in driving this surge in demand. As these end-user sectors rebounded from the pandemic, their reliance on Citric Acid increased, causing a supply-demand imbalance.

China, a major exporter of Citric Acid, faced a significant shortage ahead of the tomato harvest season. This shortage compelled manufacturers to decline orders, leading to a decrease in imports and contributing to the upward trajectory of Citric Acid prices in the US. The ripple effect was particularly pronounced during the holiday season, exacerbating the strain on limited supplies. An additional factor influencing the increased cost of Citric Acid production is the substantial rise in energy expenses. Manufacturers are grappling with higher operational costs, which, in turn, are being passed on to consumers. This cost escalation is a significant contributor to the prevailing surge in Citric Acid prices in the USA.

A persistent gap in the price range of Citric Acid between China and the US further complicates the situation. Antidumping duties imposed by the US government have led to this disparity. The US recently announced its affirmative final determinations in the antidumping and countervailing duty investigations on Citric Acid imports from China. In the China investigation, mandatory respondents TTCA Co., Ltd. (also known as Shandong TTCA Biochemistry Co., Ltd.) and Yixing Union Biochemical Co., Ltd., received final dumping rates of 129.08% and 94.61%, respectively. Eleven other Chinese exporters qualified for a separate rate of 111.85%. All other exporters will face the China-wide rate of 156.87%. These antidumping duties have created a considerable gap between the Cost and Freight (CFR) prices and Free on Board (FOB) prices of Citric Acid in the US market.

The impact of these antidumping duties extends beyond pricing differentials, as they also influence the dynamics of international trade. Manufacturers and suppliers in the USA are navigating through challenges posed by these duties, affecting their competitiveness in the global market.

Industry experts foresee continued volatility in Citric Acid prices in the coming months. The interplay of international demand, supply shortages, and regulatory interventions, such as antidumping duties, will likely keep the market on its toes. Manufacturers and stakeholders are urged to monitor these developments closely and adopt agile strategies to navigate the uncertainties in the Citric Acid landscape.