China’s Metformin HCL market witnessed a sharp decline in May as policy-driven procurement measures, expanding production capacity, and weak export demand weighed heavily on prices. The National Health Security Administration’s reference pricing reduced sellers’ pricing power, while new production lines in Jiangsu increased supply availability throughout the month. As a result, Metformin HCL (USP, FDA) FOB Shanghai prices went down 18.9% in May from last month. Domestic demand remained relatively stable, supported by contractual procurement programs and consistent consumption from hospitals and pharmaceutical formulators. However, export demand weakened significantly as buyers in key markets such as India and Brazil reduced spot purchases and delayed procurement activities. Rising inventories at coastal warehouses further intensified pressure on suppliers to clear stocks. Despite some late-month support from higher freight, insurance, and feedstock-related costs, market sentiment remained bearish. Looking ahead, analysts expect continued pressure in June, with modest recovery potential in July and August as international buyers return for restocking and discounted purchases.
