15th edition of Foodcom ADDITIVES Newsletter
It feels as if the beginning of Autumn has been the trending topic for the past four weeks, but this period is one of the most projecting time for the additives industry. With the end of the month, market behavior became more active, as people return from vacation and begin stocking supplies for the rest of the year.
China continues to struggle with COVID-19 challenges, with prices for most products reaching record highs. The issue seems to be very perceptive with rising energy costs affecting farm profitability, and consumers being directly impacted also. At a time when household budgets are under increasing scrutiny, the plight of farmers is uncertain. And while inflationary pressures are a critically compelling problem, it’s worth considering the support of the sector that is, after all, one of the key parts of the global economic system.
It appears that optimization may be the key. Strategic planning and resource management can effectively streamline any process with the use of the adequate amount of fertilizer or additives. What solutions will farmers choose, and will be the effect on the feed additive market? What steps should your company take to be prepared for winter? Perhaps this is the last call to make decisions on stocks.
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Methionine / Threonine / Lysine HCL
The seasonal cycle for amino acids for the main feed ingredients is likely to soon begin, thus causing increases in demand. We expect price declines to pause, and likely are only increase in the case of these commodities. The vacation season will come to an end, and subsequently, it is going to be possible to more precisely determine the economic trends for the near future.
For some weeks now, there has been a significant shortage of urea on the European market, regarding both technical and feed grade. This is undoubtedly related to the sanctions against Russia, from where large urea quantity have been supplied to Europe. Within a short period of time, quotas for this raw material in the European Union have increased quite significantly.
Choline Chloride 70% / Choline Chloride 75%
Under the influence of high costs and tight supply of ingredients from above, some Chinese choline chloride factories had been forced to raise prices. The market response was quick, as the offered prices began increasing. It is crucial to monitor the market situation, as we should expect further fluctuations in costs and production in the coming weeks.
The market for vitamin C is expanding right now, as it is the time of year when consumers introduce immunity supplements to their diets. The same phenomenon is true for the feed sector, where vitamin C sales increase significantly with the approach of autumn. When analyzing consumer trends regarding nutrition, studies show that attention to foods that support the immune system is growing.
We expect sharp price increases for salt, mainly because of energy cost upturns that are not foreseeable today. The demolished salt factory in Ukraine could further affect the situation of this raw material in Europe. This is again influenced by the embargo on the import of Belarusian goods into the EU. Some Polish salt traders were thus forced to seek sodium chloride products from more distant regions. Interestingly, prices for road salt have risen so much that they are approaching food-grade prices. Producers do not accept large permanent contracts because it is still unknown what will happen in tGuarhe near future.S
Guar Gum / Xanthan Gum
The last few days have brought an increase in inquiries for biogums. The requests for purchase had grown significantly from day to day. Among all, the amount from Southern Asia stands out. The noticeable demand in the case of Xanthan Gum is eminent, but it seems like large volumes these days are almost negligible. Upcoming biogum deliveries are scheduled for late September.