Glutamic Acid Shows a Confident Market Outlook in Asia Throughout Q1 2023
- 24-May-2023 3:36 PM
- Journalist: Bob Duffler
At the start of Q1 2023, Glutamic Acid prices across the Chinese provinces were observed to increase under the influence of several factors, including consistent demand, moderate supply, and increased prices for raw material sugarcane bagasse and palm waste.
In the Chinese market, the prices of Glutamic Acid increased in the month of January. Throughout the nation, the sugarcane plantation area remained largely constant. Low temperatures and floods during the seedling stage and high temperatures and dryness during the elongation stage severely influenced the sugarcane in Guangxi. This affected the raw material Sugarcane bagasse market, which further influenced the Glutamic Acid production activities and prices in the domestic market. Sugarcane, the major offering during the Thnee Kong Seh (Jade Emperor's birthday), was once again in high demand since this year's celebration on the ninth day of the Lunar New Year was joyous. In addition, China reopened sooner than expected as regulators abruptly reversed their strict Covid rules. The fourth quarter of 2022 saw market disruptions brought on by an increase in COVID-19 cases in the Chinese provinces, which also influenced the Glutamic Acid market position in January. Authorities were nevertheless concerned about the future of commerce due to the significant risks posed by China's abrupt reversal of the "zero COVID" policy. In order to maintain their profit margins, domestic suppliers were forced to raise the price of Glutamic Acid in the domestic market.
Later in March, the prices were recorded to be stable. Also, the domestic sales and production numbers were solid with the increased demand from the end-user industries and the replenishment of Glutamic Acid inventories. The general tight market situation was maintained until the start of Brazil's new squeezing season for feedstock sugarcane which impacted the market prices of Glutamic Acid. The enterprise's stable price stance is further supported by the fact that the main producing region, Guangxi, has entered the destocking stage after being under pressure from sales.
According to ChemAnalyst, the prices of Glutamic Acid are likely to witness an appreciating trajectory on the back of increased production activities for the replenishment of inventories with fresh stocks.