For the Quarter Ending June 2022
The price of vitamin C rose over the first half of the second quarter of 2022 before falling during the second half, starting in May. The COVID suspension in China's commercial centers, which significantly hampered imports, exacerbated a supply bottleneck in the US. Because of the US's rising inflation, the geopolitical situation in Russia and Ukraine, and the highly unpredictable oil prices, domestic traders and purchasers were concerned about high raw material prices throughout the quarter. Following the dramatic drop in oil prices in May, import, consumer, and production spending increased somewhat. Despite the Asian blockades, Chinese marine cargo appeared to be going fine through June.
The pricing trend for vitamin C in the Asia Pacific region demonstrated a declining tendency during the second quarter of 2022. After the reopening of its factories and ports, China's domestic market saw a significant increase in the production of nutraceuticals during the first half of the quarter. The country's nutraceutical markets were affected in several ways by a spike in COVID-19 cases during the last week of April; thus, the Chinese authorities put important production facilities on lockdown, which largely affected the operations. Due to the country's "Zero Tolerance" policy and every-so-often lockdowns, several cargo ships became stranded at ports, making moving the product to other markets more challenging. Toward the end of the quarter, several firms were ready to provide the items at a discount to get rid of stocks before they degraded due to the high COVID taxes. As domestic manufacturers and consumers had enough inventory to meet demand, the nutraceutical and pharmaceutical industries saw robust quarterly intakes.
Despite a slight price decline that started at the end of June, the vitamin C market in the European region remained favorable during the second quarter of 2022. It became more difficult for exporting countries to conduct business due to the conflict between Russia and Ukraine, which increased transportation costs and hindered the flow of goods into Europe. Demand from end-user businesses was stable throughout the entire quarter. As a whole, there was enough stock at the suppliers to satisfy all domestic demand.
For the Quarter Ending March 2022
The prices of Vitamin C remained strong in North America. High demand for Ascorbic Acid from the pharmaceutical and nutraceutical sector amid Covid during wintertime rose the values, especially in the 2nd half of the first quarter. On the back of stable offtakes from the downstream industries, the values remained stagnant in mid of February 2022. The prices rose during March as the shortages of supplies due to prolonged port congestion and supply chain disruptions further influenced the values of Vitamin C in the American market towards the end of Q1. The USA's prices settled at USD 8130/ MT on CFR basis in first quarter 2022.
The demand for Vitamin C products rose during Q1 in the pharmaceutical and nutraceutical sector due to the consumer's high consumption of vitamin C-based products to boost their immunity. Due to this, Vitamin C prices remained firm and increased continuously in the Chinese market throughout the first quarter of 2022. High freight charges to importing countries amid the healthy demand worldwide impacted global Vitamin C values. The IP grade Vitamin C values settled at USD 6180 per MT on FOB basis in China. However, in the Indian market, prices witnessed a downfall due to prior stockpiling activities of Ascorbic Acid. In India, Ascorbic Acid values were accessed at USD 7452.64 per tonne at CFR by the end of Q1 2022.
The prices of Vitamin C remained firm in the European region throughout the quarter, following the price trend of the USA. The high demand for Vitamin C-based products from the downstream pharmaceutical and nutraceutical sector kept the prices higher during Q1, 2022. In March, shortages of IP grade Vitamin C supplies caused by the disrupted supply chain due to war in the East- European region resulted in high crude oil values and increased production costs. High freight costs from exporting countries further escalated the values. Due to this, values rose significantly towards the end of Q1 in the European market. However, the estimated value of Vitamin C during the 1st month of Q1 got fixed around USD5825 per MT.
During Q4 of 2021, the domestic market trend of Vitamin C showcased mixed sentiments across the North American region. Prices of Vitamin C were settled at USD 7995 per MT CFR Los Angeles in the last week of October on the back of the increased shipping cost from Asia-Pacific to North America. Bullish sentiments in the global market prompted the US market participants to keep upward pressure on the Vitamin C prices given the depleted supply dynamics and consistent volume intakes from downstream nutraceutical and pharmaceutical sectors. Prices globally have been on the rise where markets in the Asia-Pacific region dealt with high fuel prices as coal cost soared, pressuring market participants to make the necessary adjustments in order to keep their margins in quarter 4.
In the 4th quarter of 2021, the Chinese Vitamin C market witnessed a slight improvement in the week ending of October as the discussions for Vitamins C were assessed at USD 6505/MT FOB Qingdao on 31st October. The consistent fall in the quoted offers stopped in November, and the prices for Vitamin C stabilized at the spot market and got settled at USD 6165/MT FOB Qingdao in the 4th week due to the hiked corn offers as the cold weather pressurizes the availability of harvested corn crops in the market. The prices of raw materials and energy consistently soared in China, which negatively affected the Vitamin C market in quarter 4. The prices of Vitamin C fell in December as the producers were keen on destocking their running inventories ahead of the coming year-end. Furthermore, the forced closure of NHU and ZMC in the Zhejiang province induced the supply glut, and the demand exceeded the supply with a significant margin and proportionally retreated the falling pricing trajectory of Vitamin C in the domestic market. In India, the prices of Vitamin C remained stagnant in the fourth quarter under the influence of freight congestion and lack of shipping containers and were assessed at USD 543400/MT CFR JNPT in the week ending of December.
The domestic European market observed an upward momentum in the fourth quarter of 2021 following the price trend of the USA, which gradually gained numbers during the mid-week of November. As Netherlands and Germany are the major importers of Vitamins after the USA, soaring raw materials prices, peaking energy crises, and high freight costs in China compelled to trade the product at increased prices. The demand from the downstream industries, including nutraceutical and pharmaceutical, remained strong throughout the quarter.