Higher Stockpiles Support the Weaker Price Trend of Sorbic Acid Globally
- 09-May-2023 11:54 AM
- Journalist: Nicholas Seifield
The prices for Sorbic Acid continued to decline across the global market as the first half of the second quarter ended due to fragile domestic and overseas inquiries, which resulted in the rising of stocks among the market participants.
At the start of the second quarter, the prices of Sorbic Acid followed the market dynamics of the previous month. Furthermore, with uncertain demand from both the local and overseas markets, the production activity was reduced at a lower level than anticipated by the manufacturers, leading to a price decline in the Chinese market. In addition, one of the key factors supporting the slowed market trend for Sorbic Acid also includes manufacturer competitiveness. The introduction of fresh industrialists to produce Sorbic Acid into the Chinese market alarmed the established ones. In order to avoid losing sales as a result, the manufacturers further decreased the local prices for Sorbic Acid. Likewise, the official manufacturing Purchasing Managers' Index (PMI) plummeted from 51.9 in March to 49.2 in April, falling below the 50-point threshold that distinguishes monthly expansion from contraction and reaching its lowest level since China's reopening after the epidemic late last year.
Similar trends in Sorbic Acid prices were observed in the United States and Germany. Fewer exports from exporting countries, particularly China, resulted in a drop in Sorbic Acid prices in the United States at the end of the first half of the Q2 of 2023. This also resulted in fewer future price agreements between local merchants for downstream Sorbic Acid. Suppliers additionally concentrated on clearing out their surge in stockpiles to prevent the supply from deteriorating in the coming months due to this month's continued stockpile growth brought on by weaker customer demand.
According to ChemAnalyst, " Sorbic Acid prices are expected to decrease in the forthcoming months due to incessant dip in its domestic and international quotations, along with weaker trade activity."
