Two new Vitamin C factories just started production in China. Watch for ingredients from Tuoyang and Huaxing .
IBCAA Prices increased fromQ2 on due to short supply on L-Leucine. For now, L-Leucine price is almost stable (supply of L-Leucine fermentation grade is abundant), so we predict the price will be stable in Q1 of 2017. ISOLEUCINE AND VALINE The market for both products were weak in 2016, mainly because of over supply. We predict prices will keep the same trend at least in Q1 of 2017. L-ARGININE & L-ARGININE HCL Under the influence of the national environmental protection policy, the output of L-arginine produced by duck hair hydrolysis has reduced greatly, leading to the tight supply and increase of price. But the factory that uses fermentation process, such as CJ, is not affected and their production and supply is stable. In 2017, there is a possibility of a sharp price increase in L-arginine, however, the price should remain stable. L-CARNITINE SERIES Environmental costs and rawmaterial costs are rising and price is expected to rise in 2017. L-CITRULLINE The price of rawmaterials (L-arginine) rose by 25-35% and the supply of L-arginine is tight due to government control of pollution emissions. The main factories of L-citruline drastically reduced production due to relocation or retrofitting; so supply is very tight and the price will continue to increase until Q1 of 2017. Factory’s relocation, technology transformation or expansion is expected to return to normal in Q1 of 2017. From the beginning of Q2, the supply will be sufficient and the price should fall. L-GLUTAMINE Prices hit an historic low point during the 1st half of 2016. However, starting in June the price got hot and demand increased. Some factories have run out of stock since September, so prices keeps rising. We predict price will rise steadily in 2017. L-LEUCINE Under the influence of the national environmental protection policy, the output of L-leucine produced by duck hair hydrolysis is reduced greatly, leading to the tight supply and the increase of price. But the factory that uses fermentation process is not affected; their production and supply is stable. In 2017, the possibility of sharp rise in L-leucine is small; the price should remain stable or decrease. NIACIN & NIACINAMIDE (VITAMIN B3) The price of rawmaterials increased and product prices also rose slightly. The production from the major factories is average and some of the factories plan to expand production. There are some new factories starting to produce Niacin and the global capacity will increase further. In 2017, there is a small possibility of a sharp rise in price, but for now, the price should remain stable.
PYRIDOXINE HCL (VITAMIN B6) Prices are moving down frommiddle of year to now and will continue to decrease in 2017. The main reason is, in June of 2016 a new facility opened in Shanghai and market supply is more abundant. SUCRALOSE After continuously increasing fromQ1 to Q3, the current price is still at a high level. The supply is beginning to ease and the factories basically have stock, but the price is 10% higher than the futures price. The factories are working hard to increase production so as to sell more quantities under the current hot market conditions. The situation was the same from 2012-2013. The price will rapidly decline after one year of rising and we expect the price will begin to decline in Q2 of 2017. TAURINE Taurine supply is in a stable state at present. There were a number of Taurine factories closed in the past five years and the existing factories have no clear expansion plans. The supply has also been effectively controlled. With the rising costs of all aspects, the factories have a strong desire to increase price, no longer blindly pursuing output and sales and paying more attention to a reasonable profit. The price of Taurine continues to rise from the beginning of Q2 in 2016. The price has increased more than 25% until this month and is expected to rise steadily in 2017. THIAMINE HCL/THIAMINE MONONITRATE (VITAMIN B1) Market overview of 2016 is that supply continued to tighten and prices rose slowly. Considering the price is already at a very high level and there is the possibility for a new comer to step into the market, we predict prices may decrease in Q2 or the second half of 2017. TURMERIC (CURCUMIN) The increased price of rawmaterials resulted in price increase of products. The price of rawmaterials will be determined in February of 2017. XYLITOL During the first half of 2016, the supply was abundant and the market was flat. But fromQ3 on, at the effect of environmental protection policy, supply of D-xylose (Xylitol’s rawmaterial) began to tighten in Shandong Province, which is the main producing area of D-xylose and xylitol. Prices started to slightly increase fromQ4 and the price of xylitol is rising substantially with shipment lead-time projected at more than 45 to 60 days. Some factories are accepting orders more cautiously and have refused blanket orders from certain trading companies. Considering current situation, we predict supply will continue to tighten and prices will slowly rise in the first half of 2017.
MARKET OVERVIEW OF CHINESE INGREDIENTS AND A 2017 FORECAST
M ost products are affected by overcapacity and limited growth in demand and maintained a weak trend in the first half of 2016. But with the tightening of environmental protection policies, prices rising in basic energy of coal and a substantial increase in domestic freight due to overloading restriction, some factories have a strong desire to increase prices after several years of loss. Factories that produce Vitamin C and Taurine are seriously looking into price increases. From the beginning of the year, prices of these products began to increase, followed by most of the other products. FromQ4, the prices began to increase substantially.
ASCORBIC ACID SERIES The price of Vitamin C series products continue to increase since Q4 of 2016 for the following reasons: • Vitamin C factories are all under deficit due to the low price in recent years resulting in a strong desire to raise prices. • Inventory is gradually reduced after summer maintenance. • Coal prices doubled compared with the same period last year and energy costs increased. • The new supply of corn cannot be dry due to the wet weather this year, which has created a short supply. The price has increased about 7% from the middle of this year. • The government requested most of the chemical and pharmaceutical factories in Hebei Province to stop production to reduce pollution emissions fromNovember 16th through December 31st, which is leading to a shortage in Vitamin C supply. The two major Vitamin C plants, CSPC and NCPC, are located in Hebei. The market trend for 2017: Speculation is that some new large factories are ready to produce Vitamin C and these products will enter the market near Q1. The capacity in China is still huge, and in the long term, Vitamin C prices are still hard to increase. There is a prediction for a possible price fall in Q1 or Q2 of 2017. ACESULFAME-K 2016 review is tight supply and the prices are rising slowly. The main factors are: production of China's second largest AK factory
decreased because of bankruptcy rumors. The major manufacturers of Diketene (AK rawmaterials) stopped production in the first half of the year, which lead to the tight supply of AK rawmaterial and rising costs. The increased price of sucralose caused the demand shift to AK. We expect AK prices will be basically stable in the first half of 2017. CAFFEINE At the end of 2015, a domestic factory stopped production due to an explosion. The supply was tight in 2016 and the prices are stable at a high level. In November, the world's largest producer (CSPC) was affected by environmental policy. Due to this, production in December may be subject to greater restrictions. This could lead to supply shortage in caffeine, which will affect the price in Q1 or Q2 of 2017. CHONDROITIN SULFATE USP Slaughter increased in winter so rawmaterials are sufficient in the market. The current production has certain environmental protection pressure, but does not affect production. Since June, the price of this product decreased substantially and reached its lowest point in recent years. The current price is still in a low level, but stable. For the 2017 market, we believe price will rise steadily. CREATINE MONO The price decreased in 2016 due to lower rawmaterial costs and RMB-USD exchange rate fluctuations. The price will possibly decrease in 2017 due to the new production capacity from some new factories.
Disclaimer: The forecast information is speculation and opinion only. ingredientsonline.com is providing this as a complimentary service and is not responsible for the information contained in this document.
INGREDIENTSONLINE.COM • WINTER 2017
INGREDIENTSONLINE.COM • WINTER 2017
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