For the Quarter Ending March 2024
North America
The Valine market in North America faced a significant downturn in Q1 2024, marked by widespread price declines. This decline was driven by multiple factors, including reduced demand from the livestock and food sectors due to persistent downturns. Additionally, lower prices for raw materials like corn discouraged manufacturers, further dampening market activity. The abundance of stocks in exporting nations also contributed to subdued purchasing sentiment, prompting merchants to destock inventories at discounted rates. Meanwhile, the USA, a key importer of Valine, took strategic pricing actions to enhance its global competitiveness, leading to widespread price reductions in the global Valine market.
Further, moving into the middle of the quarter, the reopening of the exporting nation following a 15-day holiday and full resumption of transportation services further supported an optimistic trajectory for traders within the nation to focus on their downstream procurements. However, inquiries arriving from the regional market continued to remain muted which created an excessive supply among the producing nations which outpaced the overall demand side. As a result, the strategic decision by Chinese suppliers to offer Valine at notably reduced rates enabled US market players to maintain competitiveness by adjusting their own pricing strategies accordingly. Furthermore, the adoption of just-in-time inventory systems and the provision of discounts to facilitate the clearance of excess inventory were additionally noted throughout the quarter, alongside the scaling back of production until demand picks up again.
Lastly, the strengthening of the US dollar against other currencies has benefitted importers and traders by boosting the purchasing power of US buyers in global markets. This currency dynamic has fostered a sense of stability, enhancing confidence among market participants. Additionally, the resumption of trade activities and shipments has improved the availability of commodities, such as Valine, easing concerns about supply shortages and exerting downward pressure on prices. However, despite these positive developments, challenges persist due to subdued demand, sluggish purchasing activities, and weakened consumer confidence. As a result, market players are resorting to aggressive pricing strategies to stimulate demand and reduce excess inventories until the final weeks of March 2024 and prepare for new fresh batches with new quarter.
APAC
Throughout the first quarter of 2024, the Valine market in the APAC region, particularly in China, faced numerous challenges, resulting in an overall negative pricing trend. Subdued demand from downstream industries such as livestock, personal care, and food exerted significant downward pressure on prices, impacting both feed and food grades. However, a slight rebound in food industries towards the end of the quarter was witnessed, which was balanced by sufficient inventories held by market participants in the region. Initially, the decline in Valine prices, influenced by decreasing corn prices, posed a profitability threat, especially for producers with higher production costs. Consequently, businesses strategically reduced inventory by offering discounts, leading to a notable decrease in Valine procurement volumes. Moving into February 2024, increased competition among producers due to market surplus, combined with the Lunar New Year holidays in mid-February, prompted traders and suppliers to focus on destocking inventories to avoid excessive stockpiling and additional storage costs. Simultaneously, ongoing geopolitical issues disrupted export momentum from China, resulting in delayed shipments and higher freight costs. This creates reluctancy among suppliers and buyers within importing nations to issue new quotations which further exacerbated the situation, as demand from the region remained muted, leading to a higher accumulation of excess stocks at ports and warehouses of exporting nations. However, towards the end of the quarter, in March, there was a steady rebound in overseas quotations, supported by the normalization of previously inflated freight charges. This easing in overall trade activity helped restore some balance to the market, with a slight optimistic trajectory observed for Valine food grade as the supply side began to align with overall demand. Overall, the pricing environment for Valine in the APAC region has been relatively on the weaker side, with some upward pressure on prices in China. Market conditions, including supply and demand dynamics, raw material costs, and seasonality, have influenced the pricing trends observed during Q1 2024.
Europe
The pricing environment for Valine in the European region during Q1 2024 was predominantly negative, with prices experiencing a consistent decline yet very steady rise in food sector as quarter marks its ending in March 2024. Several factors contributed to this downward trend. Firstly, the demand for Valine, both in feed-grade and food-grade variants, fell short of industry expectations. This subdued demand, coupled with an oversupply of Valine in the market, led to increased competition among suppliers and a subsequent decrease in prices. Additionally, the depreciation of the Euro against the US Dollar further impacted the pricing dynamics for imported Valine, making it more expensive for buyers. Sportingly, the ongoing trade dispute in the Red Sea region also had a significant impact on demand and supply activities, further dampening the market sentiment. Within Germany, the being an importer of Valine continued to display the market trajectory witnessed same as that of its exporting nations, primarily China. The market experienced a persistent decline in prices, driven by lower demand and an oversupply of inventory throughout the quarter. The reduction in prices for raw materials, particularly corn, further contributed to the downward pressure on Valine prices. However, a steady rebound in food sector was witnessed by merchants as inquiries from local market showcased a modest rebound. This further benefitted the downstream suppliers across the market as Euro depreciated considerably against the dollar which market the goods in terms of euro more expensive for the buyers. Merchants within the domestic market were focused on selling their inventories yet making maximum profits throughout the month.
For the Quarter Ending December 2023
North America
The fourth quarter of 2023 proved to be challenging for the L-Valine market in the North American region. The market experienced a mixed trend in terms of prices initially in October for both grades while starting to plummet as November commenced and continued to depreciate until the final weeks of December 2023. Initially, prices fell precipitously for feed grade due to lower feed sector consumption. Nonetheless, given the state of the food industry, October's food-grade prices are still rising. Because of the declining demand, distributors and suppliers do not concentrate on further restocking as stocks remain inflated and need to be consumed first. However, market inquiries regarding food grade are still increasing, which results in consistently higher import offers coming from the exporting regions. Further supporting this, the overall market transactions were light and mainly based on the arrived inquiries for both the grades as new orders fell considerably for feed grade while that of consumption in food industries sustained its upward trend. Furthermore, suppliers and traders displayed a high level of reluctance to place significant orders with exporting countries for the upcoming quarter, given the persistent downturn in the preservatives sector. Lastly, following a continuous trend of the previous month, the conclusion of Q4 left both grades on a pessimistic note. Additionally, the ongoing economic turmoil in the United States, coupled with the global acceleration of inflation, discouraged distributors and suppliers from further restocking as existing inventories remained surplus and needed to be consumed first. Overall, the current quarter-ending price for L-Valine Feed Grade in the USA is USD 2650/MT, while that of for food grade was assembled at USD 4100/MT.
APAC
Throughout the Asia-Pacific (APAC) region, the final quarter of 2023 witnessed diverse factors shaping the pricing landscape for Valine, resulting in a nuanced market trend. Initially, for feed-grade Valine, the global supply scenario remained relatively quiet, with arriving inquiries effectively met by the existing inventories among merchants. Concurrently, merchants undertook a concerted effort to readjust their prices, bringing them back to normal levels from previously inflated rates in the preceding months, serving as a significant contributing factor to the observed drop in prices. This adjustment notably influenced the feed-grade Valine market, causing it to trend on the downward side during October. In contrast, within the food sector, a sustained uptick in the consumption of food supplements, particularly those geared towards enhancing athletic performance and promoting muscle growth, led to an increased utilization of Valine supplements. The surge in demand for food-grade Valine was fuelled by the rising popularity of these supplements. However, progressing into November 2023, according to the National Bureau of Statistics, the official Purchasing Managers' Index (PMI) experienced a slight decline to 49.4 in November compared to 49.5 in October. The slowing of declines in China's exports during November, coupled with mixed signs indicating that factories in the second-largest global economy might be recovering after a challenging period of decreased demand, contributed to a complex market scenario. Outbound shipments from China were anticipated to show a 1.1% drop in November compared to the previous year, marking the fourth consecutive month of narrowing declines, as suggested by market participants. Consequently, demand for both feed and food-grade amino acids decreased, impacting suppliers who were compelled to reduce their selling costs. Moreover, producers faced challenges in bringing their products to market due to disruptions in the supply chain. On the upstream front, reductions in the cost of raw materials, particularly corn, further lowered the total cost of production, influencing overall prices to sustain a downward trajectory. This surplus, coupled with weakened purchasing sentiments, strategically prompted merchants to focus on destocking their inventories at reduced prices, a trend that persisted until the final weeks of December 2023. With this, the prices of L-Valine for feed grade were recorded at USD 2300/MT, while that of for food grade were assembled at USD 3820/MT.
Europe
The final quarter of 2023 proved to be a demanding period for the Valine market in Europe, echoing the market trends observed in the Asia-Pacific region, a significant Amino acid producer. Several factors intricately influenced the market conditions and pricing dynamics during this period. Primarily, the Valine market faced a substantial decline in demand within the feed sector as October commenced. This dip in demand was a consequence of various factors, including economic slowdown, shifts in livestock feed compositions, and seasonal variations. Secondly, reduced import activities contributed to an oversupply of Valine in the region, exerting downward pressure on prices. In contrast, despite these challenges, Valine prices maintained an upward trajectory within the food-grade market. This was attributed to the steadily increasing consumption of Valine, particularly in various pharmaceutical applications such as drug formulations, parenteral nutrition solutions, and nutritional supplements. Furthermore, manufacturers and distributors in certain exporting countries were keen on depleting their inventories, anticipating even higher prices in the future. However, as November 2023 unfolded, reports surfaced indicating a potential decrease in production costs for Valine, prompting producers to offer more competitive prices. Suppliers and retailers were also observed offering Valine at prices slightly below the market standard, contributing to the overall descending price trend. On the supply side, while there were sufficient inventories of Valine, actual supply levels remained limited. Concurrently, demand remained low due to weakened consumer confidence, which persisted on the pessimistic side even into December 2023. The broader market, including the global feed industry, experienced growth below expectations, resulting in reduced demand for amino acids and other nutraceuticals utilized in poultry feed. Additionally, economic uncertainties and higher corn prices may have led some livestock producers to scale back on feed supplements. In summary, the Valine market in Europe faced challenges in Q4 2023 characterized by diminished demand, decreased imports, and fluctuating currency exchange rates. The prevailing market sentiment leaned towards bearish, resulting in a decline in prices. The latest price of L-Valine Feed Grade CFR Hamburg in Germany for the current quarter is USD 2720/MT while that of food grade was assembled at USD 4170/MT.
For the Quarter Ending September 2023
North America
Given the state of the market at the end of the third quarter, L-Valine prices showed a notable drop in both sectors, followed by a modest increase. July saw a sharp decline in prices, mostly as a result of a sustained decline in the food and feed industry's consumption. L-Valine prices declined as a result of this decline, which was made worse by US economic uncertainty and the rate of inflation worldwide. These factors also decreased the purchasing power downstream. The data indicates that a slowdown in new orders caused businesses to reduce staff and output, which resulted in a decline in US trading activity in July. However, China's exports to the US decreased by more than 25%. The dollar has recently dropped despite the fact that China's economy has given us more reasons to be concerned about global growth. Prices steadily increased as September rolled around in comparison to the previous month. Despite the lackluster volume of new orders for L-Valine, retailers were able to raise prices and get rid of their stock due to the slight increase in demand. By the end of September 2023, the increasing trend was maintained by improved consumption in the food, pharmaceutical, nutraceutical, and other industrial sectors.
Asia Pacific
During the entire third quarter of 2023, the cost of L-Valine experienced a sharp decline until the middle of Q3 and showed a modest increase in September 2023. Several factors contributed to this, including reduced demand due to changing consumer preferences and economic downturns and a decrease in consumption, leading to excess stockpiles among merchants. Additionally, China's Consumer Price Index (CPI) fell by 0.20% in June 2023, impacting exports, especially in amino acids, with reduced overseas inquiries. This resulted in sluggish trade and higher stockpiles at ports. Moreover, persistent declines in overseas inquiries kept production costs low, prompting suppliers to lower prices to stay competitive. However, as September concludes, prices saw a slight improvement, and this increase was driven by a rise in demand from end-users, balancing the overall supply-demand equation. Exchange rate fluctuations, particularly the weakening of the Yuan against the US dollar, led to higher costs for exported materials, contributing to the increase in L-Valine prices in the latter half of the third quarter of 2023.
Europe
During the third quarter of 2023, the European market, particularly the German market, saw a downward price trend while following the US market's trajectory. Prices fell precipitously in July and continued to remain weak throughout the month of August in both the feed grade and food grade sectors, but as the third quarter went on, they began to rise again. A factor that contributed to this decrease was the weakening of domestic market purchasing power, which resulted in fewer inquiries from suppliers and retailers. Restocking efforts ceased when the monsoon season arrived because customers were hesitant to place big orders because of the higher risk of product damage.
However, September witnessed a very moderate rise in the prices of L-Valine for both grades on the part of suppliers to offer their goods at higher prices in order to make up for earlier profit losses. Buyers remained cautious, though, as they watched to see if prices would drop even more. Furthermore, the cost of manufacturing increased in exporting countries due to rising fuel prices and energy expenses. This, in turn, helped to justify higher import prices in Germany. In addition, the German Consumer Price Index (CPI) increased from 117.50 points in August 2023 to 117.80 points in September, indicating an optimistic trend. With a steady increase in new orders in both sectors—albeit fewer than what market participants had predicted.
For the Quarter Ending June 2023
North America
L-Valine prices followed the market trend in the APAC region during Q2 2023. Overall, L-Valine prices for Feed grade showed a weaker price trend. The price trend was supported by a steady decrease in downstream demand. In addition, retailers across the domestic market had sufficient inventory to meet the overall demand in the region. The cost of energy, one of the main input costs for production, has decreased in recent months as the global economy slowed down and the price of oil decreased. This further contributed to the lower trajectory of the L-Valine price throughout the Q2 2023 period. On the contrary, Valine prices for food grade show an overall decrease in trend during Q2 but with a slight increase in trend in the first half of Q2. Domestic market demand from the downstream food industry slightly improved in the month of April in line with overall supply availability among suppliers. However, by the middle of Q2, prices decreased significantly. This was mainly driven by weak domestic demand. This trend continued until the final weeks of June. The market participants also concentrated on destocking their large stocks due to seasonal variations in the availability of powdered form. As a result, the market remained on the weak side.
Asia Pacific
The prices of L-Valine for both feed and food grade represented an opposite market trend across the Asia Pacific region during the second quarter of 2023. Feed grade prices followed a continuous downward market trend while the food grade L-Valine prices declined considerably, with a slight increase in April. A declining trend in the prices of Valine across the Chinese market was attributed to Weaker inquiries from both the domestic and overseas markets coupled with higher stockpiles. Additionally, the trade conflict between China and the United States has also made it more challenging for Chinese companies to export Valine as the two countries have levied tariffs on goods worth billions of dollars during this time. American consumers had to pay more for Chinese goods because of the tariffs, which have reduced consumer demand, which has further contributed to the weak pricing trend of Valine across the region. However, for the food grade, the prices depicted a weaker market trend throughout the second quarter of 2023, with a steady rise in the first half of Q2. During April, the prices continued to witness the market trend of the previous month resulting in higher inquiries from the domestic market. Owing to this, the suppliers continued to increase their production activity in order to meet the consistent surge in demand. However, moving toward May, in China, L-Valine prices for food grade dropped considerably throughout May and continued to depict a weaker market trend through the end of June. With a drop in global inquiries, the factories are losing money because they are selling their finished products at a production cost because the demand is very low. Also, due to the plant shutdown, because they are on maintenance, the manufacturers focused on reducing their domestic prices to destock their inventories.
Europe
All over the second quarter of 2023, the values of L-Valine across the German market for feed grade continued to drop, while for food grade, the prices demonstrated a descending trend. The prices for feed grade continued to remain on the south side, and this drop in the prices was attributed to a consistent decline in domestic demand leading, coupled with a significant decrease in import activities. Additionally, the market participants were left with higher inventories through this quarter to balance the overall demand side for L-Valine. Also, owing to this consistent drop in inquiries with higher stockpiled inventories, the traders across the German market further pulled back their orders and were eager to destock their overall stockpiles. However, in comparison with feed grade, the prices for food grade Valine displayed a weaker market trajectory throughout the second quarter, with a slight improvement in the first half of Q2. At the beginning of the second quarter, the prices for L-Valine for food grade followed the market trend of the prior month resulting in higher demand and consistent import momentum. Additionally, the traders also focused on raising their inventories by placing newer orders. However, moving towards May, the prices for food-grade Valine dropped considerably on account of weaker downstream demand from the food sector. This further resulted in a surge of inventories among the merchants as compared to the previous month market participants accumulated higher stocks owing to anticipated increased demand. Additionally, this price trend continued to depict a similar market trend until the final weeks of June, when the prices of Valine for food grade dropped by more than 13 percent. Also, in Germany, the manufacturing PMI (Purchasing Managers’ Index) has dropped to 41 in June 2023 from 43.2 in May 2023, indicating the contraction in the manufacturing sector supporting the downward pricing trajectory. Newer orders have also decreased at a faster rate as demand from end consumers has decreased.
For the Quarter Ending March 2023
North America
In early January, the prices of Valine for both grades inclined in North America, a consequence of increased orders from domestic customers. Also, the Chinese currency's rise against the US dollar, which grew by about 3% in just January alone and kept prices heading upward, also caused merchants to face the costliest import from China. As the mid-quarter, i.e., February, approaches, the prices started to decline for both grades and continued through the end of the first quarter. Valine prices thus decreased at the conclusion of this quarter, settling at USD 3955/MT for feed grade while remaining high with the settlement of USD 6020/MT for food grade in the United States.
APAC
Valine prices in the APAC region, majorly in China, remained on the upper side as the first quarter of 2023 concludes. Due to the substantial demand from the pharmaceutical and healthcare sectors, Valine prices dramatically increased in January. Technically, the end-user markets on both the local and international markets restarted with a rise in orders. Accordingly, the market mood in China remained positive until January, mostly because of predictions of increasing demand from downstream sectors. Following towards the mid of Q1-2023, the price of Valine decreased for feed grade slightly and with the settlement of USD 3400/MT while continued to remain on the north side for food grade with a settlement of USD 5500/MT in China in the month of March.
Europe
The Valine market trends in Europe followed the trend in the Asia Pacific region in the first quarter of 2023. The market trend got off to a good start and held steady until the end of January. Due to an uptick in market sentiment at the beginning of January, valine prices in Germany rose quickly. Due to lower inflation and lower energy prices, which gradually boosted consumer confidence, German consumer prices also improved more than was anticipated. However, as February approaches, the prices started to decline of Valine for feed grade remain in the upward direction for food grade owing to lessening inquiries for feed grade in the domestic market. Overall, the first quarter of 2023 saw improved trade activity as well as optimistic market sentiment. Because of this, the price of Valine on the German market was set at USD 3855/MT for feed grade and USD 5880/MT for food grade.
For the Quarter Ending December 2022
North America
North American region, primarily the United States market, the prices of Valine plummeted during the final Quarter of 2022. With the start of the fourth quarter, the prices increased considerably as the demand for food and feed grade inclined. Upstream Corn prices additionally supported the positive market trend of Valine in the United States until November 2022. Later in December, the prices started to decline gradually due to weak inquiries and temporary closure of the market on the back of New year breaks, which resulted in the stocking of with this, the cost of Valine witnessed was assembled at USD 5280/ MT CFR New York food Grade.
Asia Pacific
In the Asia Pacific region, majorly China demonstrated an ascending price trend for Valine during the last Quarter of 2022. With the start of October, the prices for Valine witnessed a decremented tendency owing to disrupted trade momentum, lessened inquiries, weaker feedstock Corn prices, and rising energy costs. Following November, the prices increased considerably until December and ended at USD 3105/MT FOB Shanghai Food Grade. Upstream corn prices during November additionally supported the market trend of Valine on the upper end.
Europe
During the fourth quarter of 2022, the prices of Valine showed descending market sentiments in the European region. With the start of October, the price trend for Valine was observed on the North side on the back of disrupted trade activities and soaring energy costs. Following November, the prices followed the trend of October. However, towards the end of this fourth quarter, i.e., in December 2022, the prices started to decline gradually, primarily due to a reduction in international orders, notably from exporting nations from China. With this, the cost of Valine witnessed during q4 was recorded at USD 5160/MT CFR Hamburg in Germany for Food Grade.
For the Quarter Ending September 2022
North America
During the third quarter of 2022, Valine's domestic market across the North American region showed conflicting sentiments. Valine was among many amino acids whose imports into the US were severely restricted as a result of China's zero-tolerance policy, which caused lockdowns to occur on and off. Due to the heat wave and a power shortage, many Chinese manufacturing facilities had to shut down in the second half of Q3, which had a detrimental impact on the US trade and downstream demand. Inflation, supply shortages, and the country's high-interest rates were just a few of the issues the market experts cited as contributing to the United States' declining demand. Food grade and feed grade figures from CFR New York were put together at $4758 per MT and $3960 per MT at the September end.
Asia Pacific
During the third quarter of 2022, the market trend of Valine in the Asia Pacific region demonstrated mixed sentiments. In the month ending September, the FOB Shanghai negotiations for food and feed grade in the Chinese market were valued at $3650 per MT and $2840/mt, respectively. Valine's price chart suffered throughout the first half of the quarter due to a number of issues, such as fluctuating raw material costs, muted consumer spending, and slow to stable end-user sector demand. Several producing facilities underwent maintenance for more than a month before the markets reopened in the final week of July. During the second half of Q3, this impacted the product flow for domestic and foreign suppliers. Economic reasons and extreme weather conditions have also negatively impacted the market dynamics.
Europe
Following the Valine price settlement at $4370/mt and $3548/mt in September, which continued a mixed pattern throughout the quarter, the CFR Hamburg discussions for both food and feed grades in the domestic German market indicated a negative tendency. The upheaval in Russia and Ukraine and the intermittent port closures in China, which later got worse due to weather conditions, further exacerbated Europe's already challenging economic climate. The food and feed industries also had low to stable offtakes and subdued demand.
