Xanthan Gum Imports Have Not Injured Domestic Industries

By Craig Tarasoff

The United States Court of International Trade has found that imports of xanthan gum, a food additive, from Austria and China did not materially injure the US domestic market. CP Kelco, a US producer of xanthan gum, argued that imports from Austria and China were being “dumped,” or sold in the US at less than fair market value, thereby unreasonably suppressing domestic prices. However, Judge Goldberg affirmed the ITC’s use of cost of goods sold (COGS) to net sales ratio to show that the effects of the import would not be felt at a market-wide level. This ratio is considered an indicator of price suppression especially when COGS rises at a faster rate than net sales. While the court found that China was not currently injuring the domestic injury, it noted that China posed a threat in the near future. As a result, it issued an anti-dumping order against China in an effort to protect domestic industry. Bloomberg has more details on the case.