For the Quarter Ending June 2025
North America
• The lactic acid price index in the USA stood at USD 1183/MT in April, USD 1230/MT in May, and USD 1320/MT in June, showing a quarterly increase of ~11.6%, reversing the earlier dip in April.
• In April, spot prices fell due to inventory overhang from Q1 frontloading and tariff-linked uncertainty, weighing on product demand outlook from food and fermentation sectors.
• The product spot price dropped 6.11% in April as downstream buyers delayed purchases amid sufficient stock and weak short-term restocking needs.
• Heavy frontloading before the April 2 tariff trigger led to a glut, causing importers to delay fresh procurement and absorb tariff-related cost pressures—dampening the product price index.
• May saw a 3.97% rise in the price index, fueled by a 90-day tariff suspension, triggering aggressive import volumes and congested logistics—escalating freight and product production cost trend.
• The product demand outlook surged in May as buyers rushed to beat potential post-August tariff reinstatements, supported by low inflation and strong restocking.
• June prices increased 7.32%, driven by persistent cost inflation and bulk procurement to hedge against future trade disruptions during the U.S.–China truce window.
• Despite stable domestic supply, intense import volumes led to short-term tightness in product spot prices, especially in food-grade and pharma-grade markets.
• Demand remained firm in June, though the price rally was more due to anticipatory buying and inflationary pressure than an actual consumption spike.
• In July 2025, the product price index is expected to increase slightly, as contract prices may reflect rising risk premiums and compliance costs amid continued policy volatility; the product price forecast remains upward-leaning.
APAC
• In April 2025, the Lactic Acid Price Index in Thailand declined by 5.50% to USD 1030/MT, marking a sharp reversal from Q1 gains, largely due to weak downstream demand, disrupted manufacturing from the late-March earthquake, and lower input costs.
• The lactic acid spot price was impacted by reduced purchasing activity and surplus finished goods inventories, as local buyers opted for lean procurement strategies amidst ongoing uncertainty.
• Production cost trend in April turned bearish as manufacturers leveraged bulk buying amid soft demand, resulting in lower upstream costs and muted factory gate pricing.
• The lactic acid demand outlook remained weak across food, personal care, and bioplastics, with international buyers showing little interest due to overstocking and inflation-linked cautiousness.
• In May 2025, the Price Index rebounded by 1.94% to USD 1050/MT, driven by a recovery in Thailand’s manufacturing PMI and a surge in new domestic and export orders.
• Seasonal strength in food and beverage demand during warmer months and tighter availability of high-purity grades contributed to the upward shift in the lactic acid price forecast.
• The demand outlook improved in May, especially for food and personal care applications, prompting proactive restocking by regional importers and enhancing export volumes.
• In June 2025, prices edged up further by 0.95% to USD 1060/MT, as the Thai PMI hit 51.7 and input costs rose for the first time since January, triggering modest price adjustments.
• Improved demand outlook in June stemmed from stable domestic consumption and renewed foreign inquiries, with producers also reporting lower finished goods inventories.
• Lactic acid price forecast for July 2025 suggests a likely increase, as demand from pharmaceutical and food preservation sectors is projected to rise ahead of the monsoon season, driven by forward buying and inventory replenishment.
Europe
• In April 2025, the lactic acid spot price (88% Liquid CFR Rotterdam) dropped to USD 1163/MT, with the Price Index falling by 5.45%, driven by supply overhang from redirected U.S.-bound shipments and pre-holiday frontloading in Europe.
• The product demand outlook remained weak in April as buyers delayed purchases due to congestion at Rotterdam and low downstream sector confidence.
• US tariff redirection increased inventory levels, saturating the market and pushing the Price Index downward throughout the month.
• In May 2025, the Price Index rebounded by 2.32%, reaching USD 1190/MT, supported by tighter vessel availability and rising booking volumes ahead of the June freight hikes.
• Port congestion in Rotterdam and low Rhine water levels disrupted deliveries, causing a sharp rise in landed costs and triggering spot-market buying.
• Seasonal demand from food, beverage, and bioplastics sectors surged, enhancing the product demand outlook and supporting higher prices.
• June 2025 saw the Price Index rise further to USD 1250/MT (+5.04%), albeit moderately, due to continued port congestion and stockpiling before summer.
• Persistent shipping delays forced buyers to prioritize delivery timelines over pricing, reinforcing upward product price forecast sentiment.
• Buyers adopted forward-buying strategies amid low Rhine water levels and logistics inflation, impacting the product production cost trend.
• In July 2025, the Price Index is likely to increase slightly as downstream buyers escalate procurement to hedge against worsening port congestion and supply lags.
For the Quarter Ending March 2025
North America
In Q1 2025, Lactic Acid prices in the USA displayed a volatile trajectory. January saw a sharp price surge due to front-loaded buying ahead of a proposed 10% tariff on Chinese goods and pre-holiday stockpiling linked to the Chinese Lunar New Year. Elevated energy costs and severe port congestion in California further strained supply chains, amplifying cost pressures.
The uptrend persisted into February following the enforcement of the 10% tariff on February 4 and the anticipation of an additional 25% tariff on chemicals in April, which accelerated procurement activities. However, by March, prices declined significantly.
Weak domestic demand, high inventory levels from previous months, and growing trade uncertainty created a buyer's market. Distributors held back on fresh purchases amid risk aversion and aggressive supplier pricing. Despite currency-driven cost pressures, the subdued buying environment prevailed, leading to a softening in prices.
Overall, Q1 was marked by an initial tariff-driven price spike followed by a steep correction in March as supply outpaced demand.
Asia Pacific
Lactic acid prices in Thailand experienced a steady upward trend throughout Q1 2025. January witnessed a significant price surge due to strong demand from food & beverage, pharmaceutical, and cosmetics industries. Higher energy and food costs, coupled with rising potato starch prices—a key raw material—pushed up manufacturing costs, which were passed onto buyers. In February, the momentum continued as Thailand’s expanding manufacturing sector supported increased purchasing activity. Rising foreign interest, partly due to a weaker Thai baht enhancing export competitiveness, also added to demand-side pressures. Although inflation eased to 1.08%, improved consumer spending supported a stable market environment, allowing suppliers to raise prices further. In March, lactic acid prices increased again amid sustained downstream demand and ongoing supply chain constraints. The food processing and cosmetic sectors continued to show healthy procurement activity, while limited domestic inventory levels and extended delivery times tightened market availability. Overall, the combination of strong domestic and international demand, rising input costs, and constrained supply contributed to the consistent price increase across all three months of Q1 2025 in Thailand’s lactic acid market.
Europe
In Q1 2025, lactic acid prices in the Netherlands displayed a mixed trend. January saw a sharp price increase, fueled by strong demand from the food, cosmetics, and pharmaceutical industries amid improved business sentiment and restocking efforts. Buyers accelerated procurement due to anticipated Lunar New Year-related disruptions in Asia and shipping issues in the Red Sea, tightening supply and pushing prices upward. In February, prices edged higher due to continued supply chain challenges, including congestion at major European ports and labor disputes that delayed imports. A significant increase in lactic acid prices in Thailand further contributed to elevated import costs. Despite this, stable demand, supported by easing inflation and seasonal consumption, sustained price levels. However, in March, prices declined as the intensity of buying activity tapered off. Downstream sectors had already stockpiled inventories earlier in the quarter, leading to reduced spot market interest. Overall, Q1 was marked by an initial surge in prices followed by a softening trend toward the end of the quarter.
For the Quarter Ending December 2024
North America
In Q4 2024, Lactic acid prices in the U.S. declined due to economic uncertainty and weaker demand. Inflation concerns and anticipation of the presidential election reduced consumer confidence, leading to cautious spending and lower corporate investments. This weakened demand across sectors like food, pharmaceuticals, and cosmetics, prompting businesses to lower prices. External disruptions, such as hurricanes and strikes, further discouraged price hikes.
By November, softened demand continued, and the stronger U.S. dollar made imports cheaper, ensuring a steady supply of Lactic acid. Easing logistical constraints, especially after the resolution of the ILA strike, helped reduce costs, allowing suppliers to pass on savings. Healthy inventories and a drop in raw material prices, like wheat and potato starch, contributed to further price reductions.
In December, lower consumer confidence and reduced demand during the holiday season, along with rising inflation, further impacted prices. Proactive inventory buildup in anticipation of the Chinese Lunar New Year and potential tariffs also kept prices low. To stay competitive, suppliers adjusted pricing, leading to continued price drops throughout the quarter. Overall, Q4 2024 saw consistent price declines driven by economic uncertainty and softer demand.
Asia Pacific
In Q4 2024, Lactic acid prices in China experienced a consistent decline driven by multiple domestic and international factors. In October, weak domestic consumer demand and an oversupply of product led to competitive pricing among suppliers. Geopolitical uncertainties, including concerns about U.S. elections and protectionist policies, dampened export orders, further contributing to the price drop. The decline in raw material costs, especially potato starch, enabled suppliers to lower production expenses and pass on the savings to consumers. In November, the oversupply situation deepened due to high distributor inventories and slow demand from the nutraceutical sector. International concerns over tariffs from the U.S. and EU added to weak demand from major markets. The drop in corn starch and crude oil prices further reduced manufacturing costs, prompting price adjustments. December saw a continuation of the downward trend as disinflation and sluggish demand across sectors, including pharmaceuticals and food & beverage, led to a buildup of excess stock. Suppliers reduced prices to clear inventories, compounded by falling potato starch prices. Overall, the quarter saw a competitive, price-driven market environment in China.
Europe
In Q4 2024, Lactic acid prices in the Netherlands experienced a steady decline, influenced by a combination of economic and market factors. In October, inflation concerns tempered consumer spending, leading to weaker demand across key sectors such as food and beverages, personal care, and pharmaceuticals. Additionally, a sharp drop in shipping costs on Asia-Europe routes improved supply levels, contributing to price reductions as companies adapted their logistics strategies. November continued to see softening demand, as industries remained cautious in the face of ongoing economic uncertainties. The easing of energy prices and lower raw material costs helped businesses reduce operational expenses, which in turn led to further price reductions for Lactic acid. By December, weak demand, particularly from critical sectors, along with a depreciating euro against the US dollar, added downward pressure on prices. Abundant inventories and logistical disruptions, compounded by harsh winter weather, further dampened purchasing activity, contributing to the overall price decline. Overall, Q4 2024 was marked by a steady downward trend in Lactic acid prices, driven by subdued demand, reduced input costs, and a cautious market outlook.
For the Quarter Ending September 2024
North America
Throughout Q3 2024, the North American market for Lactic Acid experienced a dynamic pricing trajectory, characterized by an initial rise in prices followed by a significant downturn as the quarter progressed. In July, prices for Lactic Acid surged, driven by several key factors. Consumer optimism regarding business conditions created a positive sentiment across markets, which supported higher prices for the commodity. Additionally, supply chain disruptions played a crucial role in this upward movement. Blank sailings, caused by severe port congestion in both Asia and North America, led to ships being rerouted around the Cape of Good Hope (COGH), further straining global logistics. These disruptions increased transportation costs and reduced the availability of goods, contributing to the price hike.
However, the market took a dramatic turn in August and September, with demand for Lactic Acid dropping at its fastest rate in recent months. The rapid decline in demand prompted many market participants to reduce prices in an attempt to stimulate sales, which accelerated the downward pricing trend. This downturn was further exacerbated by falling inflation, particularly as energy prices declined significantly. The reduction in energy costs lowered operational expenses for businesses, allowing them to pass on the savings to consumers and further reduce prices for Lactic Acid.
In the USA, the market saw the most significant fluctuations, reflecting the broader North American trend. While the early part of the quarter saw price increases, the latter half was marked by a substantial decline, as market participants adjusted to weaker demand and lower inflationary pressures.
Asia Pacific
In Q3 2024, the APAC region experienced a fluctuating trend in Lactic Acid pricing, with prices initially rising before undergoing notable declines as the quarter progressed. Early in the quarter, Lactic Acid prices surged due to a combination of key factors, most notably robust global demand. This surge was particularly driven by strong export activities from Asia to major markets such as North America and Europe. Foreign importers, wary of potential shortages, adopted precautionary strategies by placing larger orders, which further bolstered upward price momentum. However, as the quarter transitioned into August and September, the trend reversed, and Lactic Acid prices began to decline significantly. This downturn was primarily caused by weakening demand, characterized by a sluggish pace of exports that reflected broader economic challenges in the region. Additionally, falling prices signaled a loss of economic momentum, further contributing to the downward pressure. The situation was exacerbated by the implementation of anti-dumping measures by major markets, including the USA, Europe, and India, which negatively impacted overall demand for Lactic Acid in the APAC region, further driving prices down. This mixed trend in pricing highlighted the region's sensitivity to global market dynamics and the significant impact of regulatory measures on regional demand.
Europe
Throughout Q3 2024, Lactic Acid pricing in the European market exhibited a mixed trend, with the Netherlands emerging as the region most significantly affected by price fluctuations. In July, prices experienced a notable uptick driven by various factors. Despite the Eurozone's economic sentiment remaining relatively constant during the month, inflationary pressures, particularly those stemming from rising energy costs, shaped the economic landscape and contributed to the initial price increases. However, this upward trend shifted in August and September as several key factors converged to exert downward pressure on prices. The worsening economic environment in Europe, characterized by declining business morale and weak consumer sentiment due to increased insolvencies and a bleak economic outlook, led to diminished domestic demand for various products, including Lactic Acid. This weakening demand was a significant factor contributing to the reduction in prices. Additionally, a notable decrease in shipping container spot rates on Asian and European routes played a crucial role in this pricing dynamic. The reduction in transportation expenses facilitated by lower shipping costs further supported the overall decline in Lactic Acid prices across the European market.
FAQs
1. What caused the lactic acid prices to fluctuate in Q2 2025 across regions?
In April, prices declined in all regions—primarily due to frontloaded inventories, weak short-term demand, and cautious buying behavior. However, by May and June, prices rebounded. In North America, the 90-day tariff suspension drove aggressive imports. APAC saw gradual demand recovery, and in Europe, seasonal demand and port congestion supported higher prices.
2. How did trade policies and logistics influence the lactic acid price index?
In the U.S., the looming reinstatement of tariffs after August led to bulk buying and port congestion, increasing freight and compliance costs. In Europe, delayed U.S. shipments were rerouted, creating oversupply in April, while persistent congestion at Rotterdam and low Rhine levels pushed prices up by June. Thailand, despite being less affected by tariffs, saw rising costs due to seasonal logistics strain and export recovery.
3. Which sectors contributed most to lactic acid demand in Q2 2025?
Food and beverage sectors remained the top demand drivers in all three regions. Personal care and pharmaceutical industries contributed notably in APAC and Europe, especially as the monsoon and summer seasons approached. In North America, strong demand from food and fermentation sectors revived by June, as buyers anticipated Q3 disruptions and restocked accordingly.
4. Why did spot prices rise in June despite stable supply in some areas?
In June, price rallies were largely driven by anticipatory buying, inflationary pressures, and tight logistics rather than actual consumption spikes. Even where supply was stable—such as the U.S. and Thailand—bulk procurement ahead of expected disruptions and rising input costs kept upward pressure on spot prices.
