THE CONFERENCE PROCEEDINGS - IFEAT

The GT derivatives industry has beendeveloping fast in China, and it is mainlygum turpentine that has been processed inChina. Diag. 10 illustrates the GT volumethat was used in processing variousterpene-based chemicals in China and thequantity for exporting respectively in2009. The top three uses are for producingcamphor, terpineol and aroma chemicals.Only about 2% of GT is for export, but ifthe quantity used by pinene processing isincluded, 21% is exported.Terpene Based ChemicalsGT Volume Used(tonnes)Camphor, IBA & Camphene 35,000Terpineol & Pine oil 30,000Aroma chemicals 18,000Terpene Resin 15,000Borneol 6,000Pinene for export 25,000Turpentine export 3,200Total GT volume used in 2009 132,200Chinese GT Derivatives IndustryDiag. 10 China GT Usage Breakdown in 2009Source: China Rosin & Turpentine Derivatives TradeAssociation, Customs Data & internal estimatesSource: China Rosin & Turpentine Derivatives Trade Association,Customs data and internal estimates Challenges for the GT Derivative Industry in ChinaOn one hand, China has had great achievements in past decades, but on the other hand, negativity hasfollowed. “Me too” style investment built up capacity much more than necessary. Just imagine, thereare twenty companies producing terpineol, four for camphor, six for dihydromyrcenol and four for IsoE super in China and so on. Domestic competition and simultaneous competition with producers inNorth America, Europe and India are inevitable. In the meantime, uncertain fluctuations in GT priceshave resulted in tremendous cost increases and unexpected risks for GT derivative producers. Eventhough all those threatening situations remain real, new capacity for terpene-based aroma chemicalswill continuously emerge. Small-scale companies with copied know-how, without any innovation, aregoing to find it difficult to survive.While the competition is getting white-hot, regulatory issues are getting more and more important. Aswe all know, REACH has impacted on all companies involved in the flavour and fragrance industry:there is no exception for Chinese terpene chemical producers as they look at the global market. It isnot easy to manage this but China has no choice but to face it. As the leading producers, severalChinese companies have been obligated to take the responsibility of lead registrant (LR). Fujian GreenPine has acted as the LR for camphor; Wanxiang International has acted as the LR for l-carvone, etc. It99