LONDON, April 21, 2016 /PRNewswire/ -- In March 2016, the NDRC made a "yellow warning" on the market price of live pig. China's ex-works price of live pig in early March increased over 50% YoY. This was mainly because of the short supply caused by the shutdown of large number of small farms.
However, the soaring pig price didn't boost the market prices of amino acids. For instance, the market prices of 98.5% lysine and 99% threonine fell by 3% MoM, due to the sluggish demand from pig farmers. Stricter environmental protection policies discouraged farmers from increasing the number of pigs in farm, despite the soaring price.
Meanwhile, more Chinese enterprises engaged in developing high-end amino acids. Meihua Bio and Fufeng Group, two leading manufacturers of glutamic acid and MSG, announced rises in this business in their 2015 financial figures. But both the two companies plan to focus on the development of other high value-added amino acids, like threonine and pharmaceutical grade amino acids.
In Q2 2016, China's market prices of amino acids are less likely to rebound. Apart from the influence from sluggish downstream demand, the fall in the market price of corn also counts. So far, some national policies to pull down temporary storage of corn has come out, which will further the falling price of corn. This can reduce the production cost of amino acids, like lysine and threonine, and further, their market prices.In March, the Vietnamese Ministry of Industry and Trade announced new tariff policy for imported monosodium glutamate (HS code: 29224220). The new policy may have negative influence on China's exports of MSG, as Vietnam is the second largest export destination. However, Chinese exporters may choose to export MSG coded 21 03901 0 to ease the influence.
On 19 March, 2016, the NDRC issued a "yellow warning" on the market price of live pigs and declared to make timely price downregulation. According to analysts CCM, the soaring price was caused by short supply. Despite the national control, the price will not go down much. In the short term, the number of sows and piglets in farm will keep low, affected by stricter environmental protection policies and swan diseases in winter. Under this influence, the overall lysine market is expected to keep slack for some time.
In March 2016, Meihua Bio released its 201 5 financial figures. Its revenue increased while net profit decreased, influenced by rises in sales volumes and falls in sales prices. In 201 6, the company will continue focusing on high value-added amino acids, like lysine and threonine.
In March 2016, Shenghua Biok released its 201 5 financial figures. Specifically, revenue from tryptophan business decreased out of the drops in both sales volume and price. In 201 6, Shenghua Biok will focus on "pan-entertainment" business to hunt for new profit growth.
Henan Julong succeeded in developing new production technique of 4-HIL. Meanwhile, the company intended to expand its Ltryptophan business, which also put itself under the risk from downturn in tryptophan market price.
In March 2016, Fufeng Group reported its falls in 2015 full-year financial figures, mainly because of the falling sales price of xanthan gum. However, the rise in sales of amino acid business eased the slump. In 2016, Fufeng Group aims to be the biggest global manufacturer of threonine.
On 4 March, 2016, Yongan Pharmaceutical, a listed company producing and exporting taurine, announced that Kangjian Pharmaceutical, its subsidiary, obtained the High-Tech Enterprise Certificate. According to analysts CCM, this will be beneficial to its self-development and further expand downstream market for the parent company.
In March 2016, China's market price of lysine went down, possibly affected by the falling price of corn and sluggish downstream demand. In the near future, the coming of some policies will push the market price of corn to reduce. Thus, the price of lysine is likely to stay low due to lower cost.
On 11 March, 2016, Evonik made an announcement about its rise in threonine sales price. However, this didn't manage to boost the market price of threonine in China due to oversupply. In the next two months, the market price of threonine may continue declining given the large possibility of fall in corn price.
China's import price of methionine kept high in H1 2015, but fell sharply in H2. This was mainly because of the increase in market supply and the intense competition among enterprises, which was caused by the rises in both domestic output and import of methionine since the end of 201 4. Besides, with more newly-built overseas plants going into production, China's import origins began to shift from Europe and America to Asia.
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