China's market price of vitamin B2 (VB2,
=riboflavin) has kept rising. According to CCM's price monitoring, in May 2016,
the figure of 80% feed grade VB2 reached USD43,351/t (RMB285,635/t), up 124%
YoY, hitting the highest record since 2008.
Source: Bing
This was mainly because domestic
producers raised their quotations. In April, Shanghai Hegno
Pharmaceutical Development Co., Ltd. (Hegno) was said to raise its quotation
for VB2 to USD42.5/kg (RMB280/kg) for May's orders. Shandong NB Group Co.,
Ltd.'s spot price also reaches USD42.5/kg (RMB280/kg) at present. Hubei Guangji
Pharmaceutical Co., Ltd. (Guangji Pharmaceutical), the largest Chinese VB2
producer, has suspended offering quotations since April.
So far, the VB2 production has been
concentrated. The three producers above are the leading ones, 80% of the
domestic sales. Early in 2007, domestic VB2 market price suffered from falls
after skyrocketing.
From 2008 to 2014, the overall market was in a downturn,
putting the producers under great business pressure but improving the
production concentration of this industry. Ever since 2015, leading producers
seem to have a tacit understanding and have continued raising their sales
prices. Thus, the overall market price has kept going up, despite the
fluctuations.
Monthly market price of 80%
feed grade vitamin B2 in China, Jan. 2015-May 2016
Source: CCM
Leading vitamin B2 producers in China, as
of June 2016
|
Producer
|
Production capacity, t/a
|
Remark
|
|
Hubei Guangji Pharmaceutical Co., Ltd.
|
4,500
|
Guangji Pharmaceutical & its
subsidiary Guangji Pharmaceutical (Mengzhou) Co., Ltd. both produce VB2
|
|
Shanghai Hegno Pharmaceutical Development
Co., Ltd.
|
2,000
|
/
|
|
Shandong NB Group Co., Ltd.
|
600
|
The company reduced its capacity by 50%
from 1,200 t/a to 600 t/a from 21 Dec., 2015 onwards
|
Source: CCM
Domestic producers are likely to largely
improve their overall performances, given the soaring VB2 market price and
falling raw material price at present.
As VB2 is produced by fermentation, raw
material and energy take up large parts in production costs, especially corn
starch (raw material for VB2). The production of one tonne of VB2 needs 18-20
tonnes of corn starch. Since H2 2015, China's market price of corn kept sliding,
affected by the increasing output and huge inventory in recent years. This has
pulled down the market price of corn starch which showed record lows from Jan.
to May 2016.
Thanks to this, producers have lowered the
production costs and thus largely improved gross profit. For instance, Guangji
Pharmaceutical announced a large YoY rise of 56.25% in its Q1 2016 revenue and
its net profit reached USD3.50 million (RMB23.06 million), vs. loss in Q1 2015.
Monthly market prices of corn
& corn starch (northern) in China, Jan. 2014-May 2016
Note: Corn starch price: the figures in northern
China
Source: CCM
China's exports of VB2 (HS code: 29362300)
also showed an upward trend. According to China Customs, from Jan. to April
2016,
-
Volume: 805.62 tonnes, up 20.89% YoY
-
Value: USD25.33 million, up 26.43% YoY
-
Price: USD31.4/kg on average, up 4.6% YoY
The soaring domestic market price of VB2 slightly boosted the export price.
China mainly exports 80% VB2, 70% of the national export volume. Hegno and
Guangji Pharmaceutical are the top two exporters, 90% of national figure.
China's exports of vitamin B2, Jan.
2015-April 2016
Source: China Customs
This article comes from Vitamin China E-News 1606, CCM
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Tag: vitamin VB2