Do you know what potassium hydroxide is? Potassium hydroxide is widely used in the industrial field, such as chemicals, food, medicine and dyes. In the Chinese market, 18% of the raw materials are used in medicine, 8% are used in battery production, and 7% are used in the daily chemical industry. In addition to its own applications, most of China's resources are used for exports, including the Japanese market.
Just this week, Japanese companies suddenly announced that they would extend the charges for potassium hydroxide produced in the Chinese and South Korean markets for five years, from the original decision to end on August 9 this year to August 9, 2026, with a fee rate of 73.7%. You know, this charge is generally 3.9%. So why was the country "surprised"?
In this regard, the other party also gave an explanation, saying that there are subsidies for potassium hydroxide produced by Chinese enterprises, and the pricing in the market is too low, which has caused pressure on the other market. In fact, this decision was not "accidental". Before 1993, the Japanese market had become China's largest trading partner for eleven consecutive years, and it was not until sixteen years ago (2004) that it was replaced by the European market.
Looking at the two sides now, the identities of the two sides are obviously interchangeable. According to the data of the previous year (2019), China has become the largest trading partner of the Japanese market for twelve consecutive years, and the bilateral trade volume has exceeded 300 billion US dollars. Last year, although the country's exports plummeted by 11.1%, exports to the Chinese market still reached $174.8 billion, up 1.8% year-on-year.
In contrast, the country's exports to the European and American markets have shown negative growth. It can be seen that it is no accident that the country suddenly made such a decision!