There are several factors that are currently having the greatest impact on the market for Additives and commodities in general. First, the vacation season has begun. Buyers, who themselves will go to rest a little later, are making their last major purchases to secure companies and factories while they are away.
Tourists are arriving in their favorite destinations, where consumption of traditional local foods is on the rise. And, of course, so does general consumption. At the same time, demand for certain ingredients used in animal feed has declined slightly. That’s not particularly surprising; after all, neither pigs nor chickens take vacations. Or do they?
It’s getting warmer and the weather is getting nicer in many places (here it is not, so if it is where you are, we envy you, of course), which means that even those who stay at home are switching to more ‘summer’ consumption, so demand for ingredients for sodas, ice cream and other such delicacies is up.
Summer is also, as you know, the time when all the pre-planned shutdowns and production stops take place. After all, factories deserve a well-earned break (or maintenance) too, right? In any case, such interruptions in production continuity, even if foreseen, inevitably affect the availability and price of certain goods, so it is especially important now to closely monitor the current situation.
Citric Acid
Supplies of this commodity from China to Europe are flowing. The situation remains stable, and prices have even fallen somewhat in Europe. However, it is predicted that they may soon rise as the cost of supplying all raw materials from China increases.
Xanthan Gum
Xanthan Gum is available on the market in sufficient quantities. The price of the product has decreased somewhat recently. There are regular contracts for the purchase of Xanthan Gum. The season for intensive use of Xanthan Gum is in full swing, so there will probably be more such contracts in the near future.
Methionine
Methionine, like other amino acids, remains wanted on the market and is in demand. Prices for Methionine have risen again among manufacturers and other suppliers, and all indications are that the upward trend will continue in the coming weeks.
L-Threonine
Threonine is among the most sought-after products on the market of Additives that are, of course, Amino Acids. It is the most expensive among the substances of this type now. Due to the current limited production, there are shortages and the price keeps rising.
Lysine HCl
As we have written in previous issues of the newsletter, prices for Lysine HCl have been rising steadily for several weeks. While buyers might take this as a sign to hold off on purchases and wait for prices to fall, this may not be the optimal strategy. One major producer has announced the temporary closure of two of its factories in June and July, respectively, so this may indeed be the last chance to buy before the next significant and rapid increase.
Europe
The International Fertilizer Association has examined how long we will have enough phosphate
The IFA, a France-based organization, commissioned the study to estimate global reserves and resources of phosphate, one of the key ingredients in fertilizer production. The study concluded that there is no global shortage and that reserves of mined and processed phosphate ore are sufficient for about 350 years at projected consumption levels and with current technology. Some argue that this is an underestimate and that there are enough reserves for more than 1 000 years. Well, those who have contracts for the year 2458 should definitely keep a close eye on the next news on this subject.
Germany calls on the European Commission to investigate biofuels
Germany has called on the European Commission to investigate the flow of allegedly diluted biofuels into the European Union. EU incentives to produce biodiesel from waste oils and fats have led to suspicions that some companies in Asia are blending the biofuel with cheaper oils and then exporting it to Europe. Germany expects the Commission to conduct an assessment to determine whether fuels produced in China meet sustainability criteria and greenhouse gas reduction requirements.
Iberdrola is expanding its green hydrogen offering
The Spanish energy company plans to expand its green hydrogen supply by building a 750 million euro plant to produce green ammonia. The new plant will be profitable, according to the company, thanks to support from European funds that the company plans to apply for. It will be the first green ammonia plant in Southern Europe, and its exact location has not yet been announced. The new plant is expected to create up to 3 500 jobs.
The Americas
Nestlé is looking for ways to reduce emissions
One of the aspects the company is focusing on and studying in the United States is enteric fermentation – the process of digesting and also the largest source of emissions in fresh milk production. Nestlé is funding research to evaluate the efficacy, health and safety aspects of feed additives for humans, animals and the environment that have the potential to reduce methane emissions in the gut. Wondering what the cows think about that…
The USDA puts millions into the Internet
Under the fourth round of funding for the ReConnect program, USDA will provide $714 million to improve rural residents’ access to high-speed Internet. The program covers about 314,000 rural residents in 19 states. Proponents of the program say direct access to high-speed Internet is critical to functioning in rural areas today.
Iowa’s biodiesel plant halts production
A biodiesel refinery in Crawfordsville that was capable of producing about 10 million gallons of fuel per year has ceased operations. To keep it operating, it would be necessary to invest in new equipment. Such investments could prove unprofitable, depending on how federal policy toward the industry evolves, at least that’s what company officials say. A number of measures have been taken to prevent the halt in production, but to no avail.
Asia & Oceania
Kazakhstan has begun producing fertilizer from coal
Scientists in the Karaganda region have been looking for ways to use coal, which is unsuitable for industrial use due to oxidation and weathering. They have succeeded in developing a technology to convert it into fertilizer. As part of their project, a pilot plant was built at the Zapadny open pit mine. One shift of the plant can produce about 1.5 tons of humic fertilizers. Are fertilizers made from coal the future? Well, the thing about the future in general is that you have to wait a little to find out…
Transportation difficulties expected from India
Ports on the west coast of India were closed due to the approach of Cyclone Biparjoy, which was forecast to hit the region on June 15. According to available information, the closures could last for several days. They have already started on June 12. For now, there is no news of disruptions to industry on the west coast of India, but at the very least, delays in deliveries can be expected.
Australian Potash Limited has announced the suspension of the Lake Wells project
The company recently announced that the strategic review process for the Lake Wells Sulfate of Potash project has not yet yielded viable proposals, and it therefore intends to cease operations at the site. While discussions are ongoing with external parties regarding potential funding for the development of the project, there is no indication that discussions will reach a higher level anytime soon. The company plans to focus on other mineral resources for the time being.
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