Continuous Decline in Demand Lowers China's Vitamin B4 Prices

China, the major producer & exporter of Vitamin B4, has witnessed a continuous decrease in the price trend from Q4 2022 to mid-Q1 2023 on the back of insufficient purchasing power from the end-user pharmaceutical and nutraceutical industries. Since optimizing the Zero-Covid policy, the Chinese markets have rebounded quite a bit, but demand for Vitamin B4 is currently lower than usual. Along with dull domestic market activity, overseas orders, particularly from major importing countries like the US, have also decreased due to weakening demand as buyers continue to take a certain wait-and-see approach to the trend.

In China, the prices of Vitamin B4 have been reduced continuously since October 2022, reflecting the sluggish demand from domestic and international markets, which led to a wave of stockpiling of inventories. When late January coincides with Chinese New Year's Eve, manufacturers have decided to keep some stock at a reasonable rate in anticipation of a decrease in consumption from end-user producers. Since the beginning of February, demand from end-user producers has remained on the weak side as Vitamin B4 inventories are more than sufficient to meet the needs of immediate clients. Chinese merchants have mostly revised their Vitamin B4 prices towards the lower side to increase their purchases. Thus, the FOB Shanghai prices of Vitamin B4 decreased by 4.4% from last quarter and are expected to end February with a more than 4% price reduction from the previous month.

However, CFR prices of Vitamin B4 for US buyers is also decreased side by side. The CFR prices of Vitamin B4 for Los Angeles decreased by 1.1% in January and are likely to dip by around 1% in February. At the time of procurement, the US buyers are encountering cheaper import quotation from China as Vitamin B4 prices in the Chinese market also decreases. Also, China's reopening has strengthened the Chinese yuan, keeping it stable against the USD. Therefore, distributors have also decreased the prices of Vitamin B4 in the US domestic market because the import purchases are made at a price that was essentially lower than the previous month due to deteriorating demand from end-user pharmaceuticals and the healthcare sector.

According to the ChemAnalyst team, it is expected that prices of Vitamin B4 in the Chinese market will likely follow a lofty trajectory due to a recovery in demand from end-user industries and concentrated production. Suppliers will enhance their prices to maintain their profit arbitrarily as they believe in short supply of Vitamin B4.