Core Viewpoint - The U.S. Department of Commerce has initiated anti-dumping investigations against Chinese erythritol, significantly impacting companies like Sanyuan Biotech, which faces a preliminary anti-dumping tax of 450.64% [1] Company Summary - Sanyuan Biotech has acknowledged that the ongoing anti-dumping and countervailing investigations by the U.S. have affected its sales in the American market, with the extent of future impacts still to be assessed based on the investigation's progress and market changes [1] - The company is shifting its sales strategy from an export-focused approach to a balanced domestic and international strategy, emphasizing the domestic health consumer market and developing B-end clients [1] - Sanyuan Biotech is launching "Yuansheng Sweet" small-packaged sugar products to enhance consumer awareness of healthy sugar alternatives [1] Industry Summary - Erythritol is a low-calorie sweetener widely used in "zero-sugar" foods and beverages, known for its low sweetness, minimal risk of cavities, low blood sugar impact, high stability, and good taste [1] - The U.S. Department of Commerce is expected to release the final ruling on the anti-dumping investigation by November 23, 2025, while the final ruling on the countervailing investigation is anticipated by September 24, 2025 [3] - The erythritol industry is facing multiple international trade challenges, including anti-dumping investigations from both the U.S. and the EU, with the EU imposing anti-dumping duties ranging from 34.4% to 233.3% effective from January 17, 2025 [3] - The erythritol industry is projected to enter a capacity clearing phase starting in 2024, with prices expected to recover and gross margins increasing from 1.1% to a range of 8.3% to 14.2% [3] - The domestic market for erythritol is anticipated to grow due to increasing health consumption awareness, with significant recovery in profitability expected in 2024 [4]

Core Viewpoint - The U.S. Department of Commerce has made a preliminary ruling on countervailing duties for erythritol imported from China, impacting companies like Baolingbao and Sanyuan Biotech, which are adjusting their strategies in response to the investigation [1][2]. Company Responses - Sanyuan Biotech has acknowledged the impact of the U.S. investigation on its sales and is shifting its sales strategy to focus more on the domestic health consumer market while also exploring new markets in Southeast Asia, India, and the Middle East [1][3]. - Baolingbao, facing a lower anti-dumping tax rate of 34.4% from the EU, has seen a significant increase in revenue from erythritol products in Europe, with a 123% year-on-year growth in Q1 2025 [3]. Industry Challenges - The sugar substitute industry is facing multiple international trade challenges, including anti-dumping investigations from both the U.S. and the EU, with the EU imposing anti-dumping duties ranging from 34.4% to 233.3% [2][3]. - The domestic erythritol market is currently experiencing low prices, but the competitive landscape is easing, which may lead to a more stable supply-demand balance in the future [4]. Financial Performance - In 2024, Sanyuan Biotech reported revenues of 710 million yuan, a 42.7% increase year-on-year, and a net profit of 110 million yuan, up 87.5% [3]. - Baolingbao's revenue for the same period was 2.4 billion yuan, a decrease of 4.8%, but its net profit increased by 106% to 110 million yuan [3].