For the Quarter Ending September 2022
The third quarter of 2022 saw a decline in the market trend for Arginine, with CFR Los Angeles values dropping from $6250/mt to $5940/mt from July to September. Because of China's zero-covid policy, imports of several amino acids into the US were heavily restricted, Arginine. Due to the heat wave and a power shortage, several Chinese industrial facilities were forced to shut down in the second half of Q3, which had a detrimental impact on US business. The nation's declining demand was attributed to a number of issues by various businesses and experts, including inflation, supply shortages, and the country's high-interest rates.
In China, with FOB Shanghai values falling from $6080/mt to $5700/mt from July to September, the market trend for Arginine in the Asia Pacific area showed a negative tendency. This pricing pattern has been influenced by a number of factors, including fluctuating raw material costs, sluggish consumer spending, and weak end-user sector demand. Due to the slow offtakes and weak downstream demand during the first half, big suppliers delayed making significant orders. Following the shutdown, various manufacturing facilities, including Vega Pharma, Prumix, and others, were undergoing maintenance when the markets reopened in the last week of July. This had an influence on the product supply for both domestic and foreign suppliers throughout the second half of the quarter. Extreme weather and economic factors have also negatively impacted the market dynamics in China this quarter.
In the German domestic market, the CFR Hamburg negotiations dropped from $6180/mt to $5770/mt from July to September 2022, continuing a decreasing trend over the third quarter. In addition to the upheaval in Russia and Ukraine, the on-and-off port restrictions in China exacerbated the already challenging economic environment in Europe. Furthermore, this quarter saw a weak demand from the food and feed sectors. Offtakes in the end-user industries for the demand during this quarter ranged from low to stable.