Global Potassium Sorbate Market Faces Downturn Amid Lower Consumer Demand

The prices of Potassium Sorbate declined drastically in June 2023 compared to the previous month. This major dip in the prices of Potassium Sorbate resulted in higher stockpiles among local merchants and retailers, weakened importing activities, and reduced production momentum within the exporting nations, primarily in China.

The downstream demand for Potassium Sorbate, primarily used as preservatives in the food and pharmaceutical sector, had positively supported the downward price trajectory during June 2023. Moreover, buying activities producers contracted at the steepest rate during June, as shrinking new orders led various firms to adjust their spending downward. Also, some companies mentioned that lower buying activity for Potassium Sorbate reflected efforts to destock and wind down this month's inventories to cope with their losses. Furthermore, weak upstream Sorbic Acid cost supported additionally supported the downward trend.

On top of that, the US Manufacturing Purchasing Managers Index (PMI) for June 2023 has seen a decline of 46.3 from May's 48.4. Contrarily, the US Consumer Price Index (CPI) for the same month had been upward as it witnessed a modest increase of 0.1%, down from the 0.3% rise seen in May. Moreover, Core CPI, excluding food and energy prices, rose 0.3% in June, following a 0.6% rise in May. This decline in  PMI indicates a decrease in demand for Potassium Sorbate manufactured goods. Which additionally is a sign of slowing economic growth.

Another factor contributing to June's price trend for Potassium sorbate is the decline in upstream Sorbic Acid cost across the region. Moreover, the surplus export of the product from exporting nations has further contributed to a price decline. The United States is one of the importers of Potassium Sorbate from the APAC countries, primarily from China, and concerning June, the supply activity within the Chinese market was more than enough to meet the demand for this month. However, the currency devaluation in China could boost domestic demand for pharmaceutical excipients, including Potassium Sorbate, in the local market, as consumers and businesses may be more likely to buy domestically produced goods if they are cheaper than imported goods.

As per the ChemAnalyst analysis, the prices of Potassium Sorbate are projected to remain on the downward side in forthcoming months as well. Also, trade activity might continue to remain weak with a consistent drop in freight charges. Upstream Sorbic Acid is expected to support the negative market trend, and participants will likely focus on destocking their stockpiles.