Feed additive tracker: Is the recent upward price trend of vitamin C broken?

By Jane Byrne contact

- Last updated on GMT

© GettyImages/Laurence Dutton
© GettyImages/Laurence Dutton

Related tags: methionine, Vitamin C, Amino acids, freight

After slow market activity during July and August, momentum is back in the international feed additives markets.

Price risk for most tracked amino acids has turned to the upside during the last four weeks as key manufacturers suddenly reduced production amid strict enforcement of energy and emission policies in North China, says Kemiex.

“For synthetic products such as Dl-Methionine, markets are weighing somewhat stable demand, additional supply from China and higher cost for basic upstream raw materials,”​ said Stefan Schmidinger, partner at that Swiss API and feed additives trading platform.

Vitamin prices are mostly moving sideways though despite recent corporate announcements affecting supply of intermediates and ingredients, or a moderate delay to BASF’s new Vitamin A 1000 formulation plant, he told us.

Looking at H1 2021 financials of major Chinese vitamins manufacturers, it appears that, in most cases, profitability suffered significantly despite higher sales revenues, added Schmidinger.

Vitamin C: Is the upward price trend of 1H 2021 broken?

kemiex sept 2021 vit C graphic
Vitamin C global importer ranking by total import quantity (FY 2020) © Kemiex 

The markets have been keeping a close eye on the price of vitamin C, along with its derivatives, since November 2020 when prices doubled, and many end users were unpleasantly surprised by skyrocketing freight and raw material costs ahead of signing their annual contracts, noted Schmidinger.

“Import data from the world’s largest countries suggest that vitamin C may have reached its peak, however, with at least one factory said to offering more competitive prices for 2022 deliveries.

"Considering the record-high transportation charges from China, the cost, insurance and freight (CIF) price levels may stay above those seen in 2020 though.”

EU authorizations

On the regulatory side, Kemiex reports that the EU has recently approved a series of nutritional additives:

Market authorization was granted to JARAZ Enterprises for its Vitamin K1. Also seeing approval was Zinpro's manganese chelate of lysine and glutamic acid, the iron citrate chelate of Akeso Biomedical, DSM's muramidase and serine protease, and Beldem's endo-1,4-beta-xylanase.

Freight

Kemiex reported that Ningbo seaport terminal and Shanghai PVG airport cargo have resumed operations after more than two weeks of lockdowns and COVID-19 cases.

Regarding disruptions in Vietnam, however, the army has been deployed to enforce restrictions in industrial Binh Duong province, a major manufacturing hub near Ho Chi Minh City.

FBX Freight rate indexes​, compiled by Freightos, are stable, or slightly up, on most routes but several carriers have started to announce further, and, in some cases, significant peak season surcharges, which will be effective mid-September or October, reported Kemiex.

Though, freight consultancy Sea-Intelligence​, in a recent publication, found no signs of typical capacity reductions and blank sailings ahead of Chinese Mid-Autumn Festival and Golden Week, leaving hope of a backlog clearance in congested ports.

Besides the Chinese Mid-Autumn Festival in mid-September, and Golden Week in early October, Kemiex also tells companies to mark their card over another upcoming event that could temporarily influence market activity: the 2022 Winter Olympics in Beijing, which take place in February. 

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