In September, the import prices of feed-quality and food-quality lysine hydrochloride decreased. The decrease was attributed to various elements such as stabilized world supply chains, diminishing demand from key importers, and currency devaluation against the US dollar, rendering imports more affordable. Buyers benefited from favorable prices but continued with prudent procurement techniques in spite of regional consumption losses and economic imbalances. Better production technologies for manufacturers also helped lowering the costs, once more contributing to the falling price. While the slide persisted in September, market players predict a return to trend when October comes in the fourth quarter. Seasonal demands, including increased demand for animal feed and food additives before festive periods, coupled with possible logistical hiccups and inflationary factors, will purportedly propel prices higher. In addition, global economic recovery efforts and increased purchasing demand for winter and holiday needs could bolster lysine hydrochloride demand, which would be a sign of a stable price trend upward in the coming months.
While the slide persisted in September, market players predict a return to trend when October comes in the fourth quarter. Seasonal demands, including increased demand for animal feed and food additives before festive periods, coupled with possible logistical hiccups and inflationary factors, will purportedly propel prices higher. In addition, global economic recovery efforts and increased purchasing demand for winter and holiday needs could bolster lysine hydrochloride demand, which would be a sign of a stable price trend upward in the coming months.
US Lysine Hydrochloride Prices ease in September, Expected to Recover Soon
Key highlights:
September experienced a downward trend in the price of feed-grade and food-grade of lysine hydrochloride imports, with a consistent trend throughout the month that had prices reduced by 0.5% and 0.2%, respectively. This drop can be attributed to several key reasons. First, international supply chains for lysine hydrochloride have returned to normal following previous disruptions, offering greater availability for global markets. Second, lowered demand from major importing nations has exerted downward pressure on lysine hydrochloride prices as buyers are cautious amid volatile economic times.
There has also been some devaluation of other currencies compared to the U.S. dollar, which has helped reduce import prices, which somehow favored the buyers in the form of more procurements of both forms of lysine hydrochloride. However, there was a persistent drop in regional consumption with orders arriving on a need-to-basis only supporting the pessimistic market trade sentiments, further supporting the price drop. In addition, advances in the technology of manufacturing and increased efficiency among top manufacturers have encouraged cost reductions, as evidenced by prices for these fundamental amino acids. All these put together have introduced the consistent reduction of costs of imports, easing industries that depend on lysine hydrochloride application in animal feed and food use.
Even with such a prolonged price fall, market experts are looking for a turn in market trends as the fourth quarter starts in October. Leads for forecasting suggest a gradual appreciation of lysine hydrochloride prices in the short term and beyond. Seasonal patterns that are generally seen in the fourth quarter, like higher demand for animal feed and food additives prior to festive seasons, are likely to propel lysine hydrochloride upwards. Aside from that, future supply chain limitations due to stacking logistics problems during the year-end period may also push prices up.
Added to expected currency fluctuation and inflation pressures in large markets, these are set to offer a better auspicious pricing scenario for lysine hydrochloride producers. Apart from this, global economic recovery drivers and increased purchasing considering winter requirements and holiday demand for lysine hydrochloride can also induce increased purchasing activity by importers, undoing the trend of cost-conscious purchasing for lysine hydrochloride during September.
Apart from that, with world economies slowly stabilizing and consumer confidence growing, demand for lysine hydrochloride in feed and food applications will also want to come back strongly, further supporting prices. Though September saw a run of successive price falls, market players need to gear up for the eventual turnaround in trends as October heralds the fourth quarter, signaling consistent growth in lysine hydrochloride import prices in the near future.
