October 23, 2023 Longchang Chemical

What is the price trend for Citric Acid, the raw material for plasticizer ATBC?

I. 2023 first half of the market review

1. Price trend analysis

 

In the first quarter, citric acid manufacturers normal production, stable supply. Industry start rate has always maintained a high level. in January, the upstream manufacturers inventory pressure, the price is running low. in February, with the price of citric acid, the industry bullish sentiment pervades the enterprise inventory pressure reduces, the industry inventory transferred to traders. in March, the supply of citric acid exceeds the demand for citric acid, citric acid prices continue to decline. the industry inventory digestion is too slow and gradually increase. in April, price fluctuations are relatively frequent, the downstream demand is weak, the industry inventory transfer to traders. Industry inventory digestion is too slow, and gradually increase. April price fluctuations are relatively frequent, downstream demand is weak, the industry inventory is sufficient, manufacturers for shipments gradually adjust the price of citric acid. late May began to the end of June prices are basically stable, manufacturers continue to lose money, the industry began to decline, the supply of the corresponding decrease, coupled with the raw material corn continued to rise, the price of citric acid to play a bottom.

23 years in January and February for citric acid traditional export season, export demand is better. Domestic downstream demand continues to be weak. Although the purchase and sale of citric acid in February is more active, but the main flow of goods to the hands of traders, downstream consumption did not see a turnaround. the first half of February, the amount of traders to pick up goods increased significantly. Mainly due to the second half of citric acid continues to be in a weak market, most traders do not have a large number of stockpiles, consumption of pre-inventory-based, after the year inventory levels are at a low level. early February, citric acid manufacturers continue to raise prices. “Buy up not buy down mentality” under the influence of traders to take stock of enthusiasm, actively signing orders to take stock. But from the perspective of downstream demand, in early February when the momentum is strong, some downstream choose to appropriate amount of stocking. But overall, the downstream demand release is low. March began, by the successive arrival of the previous orders and high prices, the market trading activity is again reduced, the market buying and selling atmosphere is light. 4.5 months of orders from manufacturers continued to reduce, manufacturers began to continue to adjust the price of shipments, in order to change the situation of the prominent contradiction between supply and demand. To June, the price of raw materials upward price of citric acid to play a favorable support, coupled with the continuing losses of enterprises, although the demand is still weak, but the price stabilized.

2. Start-up situation analysis

23 years 1-3 months industry start to maintain stability, late February to early March by manufacturers to raise prices, the impact of low inventories of traders, traders to take increased, the start-up rate of the stage of the rise, but the beginning of March, in the price of high as well as the arrival of previous orders one after another, manufacturers orders continue to reduce the rate of start-ups also appeared to be a substantial decline in the industry has been the beginning of the year, 68% to the current decline of 58% or so, a cumulative decline of 10%, a decline of 10%. 58% or so, a cumulative decline of 10 percentage points.

The price reference of food grade citric acid monohydrate is RMB 5400-5700/ton; the price reference of food grade citric acid anhydrous is RMB 5600-6300/ton. At present, citric acid producers gradually accumulated inventory, the supply increased, but the downstream demand at home and abroad did not see a significant improvement, the digestion of supplies is slow. Downstream and traders are cautious to take goods, just need to buy, the market trading activity is low!

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