For the Quarter Ending December 2022
As a result of the protracted turbulence in the U.S. domestic market, Vitamin C prices continued to fall in the fourth quarter of 2022, with CFR Los Angeles prices decreasing from $6050/MT to $5790/MT from October to December. Due to the Golden Week vacations, which occurred during the first week of October, imports from China were halted, forcing many domestic retailers to raise their price quotes in order to meet the ongoing demand. The tiebreakers—Covid China's lockdowns, Russia's conflict in Ukraine, rising U.S. inflation, and harsh weather—continued to jeopardize brittle supply networks for most of the quarter. The U.S. supply chain gradually improved in the second half of 2022 as the economy recovered and the port of Los Angeles on the west coast significantly reduced ship backlogs. Offtakes in the end-user industries continued to be favorable throughout the quarter in terms of demand. Because of weaker shipping demand spurred on by slower consumer spending and a decline in manufacturing activity in December, the U.S. supply networks became more flexible.
As FOB Shanghai discussions decreased from $3320/MT to $2940/MT from October to December of 2022, the domestic Vitamin C market in China showed signs of declining. Due to the suspension of industrial facilities over the Golden Week in the first week of October, China's manufacturing sector experienced its slowest contraction in October and the lowest export orders. The market's chances of catching up to the modest rise seen in several industries during the first half of Q4 were hindered by the fact that Chinese traders returning from the Golden Week holiday had to deal with a variety of contradicting signals. Domestic producers and suppliers were able to meet the whole domestic demand throughout the quarter thanks to ample stockpiles on hand. As a result of widespread protest and general unrest in the country, the government decided to modify its zero-covid legislation, which once again put the country in difficult waters. Covid-19 cases started to appear in China's major manufacturing centers at that time.
In Europe, with CFR Hamburg values assembling at $3890/MT in December 2022, the Vitamin C market showed a declining trajectory in the fourth quarter of 2022. Offtakes in the end-user industries continued to be favorable from a demand standpoint, but the pharmaceutical and nutraceutical businesses were negatively impacted by the rising costs of energy and raw materials. However, the issues with COVID-19, the circumstances in Russia, and the crisis in Ukraine all continued to have a detrimental effect on output. Due to some breathing room in the second part of Q4 2022, trade flows in Germany and the wider eurozone got strong.
For the Quarter Ending September 2022
The price of Vitamin C effectively decreased during the third quarter of 2022, with values in the domestic US market falling from $8250/MT to $5860/MT from July to September. Because of the sporadic lockdowns in China, from where the majority of nutraceutical items are imported, the companies that make vitamin C were forced to lower prices. As a result, demand in the US somewhat decreased in the second half. As the world's two largest economies struggled with clogged supply chains and rising oil prices, the Biden administration sought to reduce inflation by lifting some tariffs on imports from China. Due to the closure of production facilities in China, many of which were closed for maintenance throughout H2 of Q3, US imports decreased dramatically. In the latter weeks of the third quarter, this significantly impacted the downward pricing trend in the domestic pharmaceutical and nutraceutical businesses.
The third quarter of 2022 saw a decline price trend for vitamin C in the Asia Pacific market. This price trend has been influenced by various variables, including lowering raw material costs, muted consumer spending, and sluggish end-user industry demand. Only purchases for immediate consumption were observed from major suppliers during the first half of Q3, with FOB Shanghai prices settling at $3640 per MT in July. The weak downstream demand and the below-average offtakes were to blame for this. However, after the markets reopened in the latter week of July, certain facilities that produce vitamins carried out maintenance, which decreased the amount of Vitamin C that was publicly accessible. Later, downstream pharma and Nutra demand in the domestic market became incredibly low, which caused prices to decline and settle at $3441 per MT in September.
German Vitamin C price trend showcased a downward trajectory during the third quarter of 2022, with values for CFR Hamburg estimated at $3700/MT in July and later settled to $3480/MT in September. This quarter's economic slump was made worse by Germany's logistical problems as transportation bottlenecks persisted. The continued lockdowns in Chinese ports and the turmoil in Russia and Ukraine worsened the situation in Europe. Domestic retailers cut their prices in the second half of the quarter due to the weak demand from pharmaceutical and nutraceutical end users.
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.
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.