Many brokerage analysts believe that with the downstream feed production and sales season arrival, superimposed environmental verification, the supply will be further tightening, vitamin product prices are expected to further break through expectations.
The latest data show that the highest offer of domestic vitamin A raised 40 yuan to 350 yuan / kg, compared with the June low of 120 yuan / kg, the highest increase of 190%. The current market supply tight, offer was leaping upward trend. The reason is that the world’s leading enterprises will soon enter the maintenance period, supply shrinkage to enhance market prices is expected; At the same time, China’s Zhejiang region is receiving the fourth round of environmental supervision, so that some domestic manufacturers affected.
In the A-share market, since mid-May, the Wind Vitamin Index has set off two consecutive rounds, with a record high on August 11, starting Friday, with the index rising again before the challenge, Also active, the concept of vitamin is expected to continue to heat up.
Product generally raise prices
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In fact, not only is vitamin A, the recent price of multiple vitamin varieties are accelerating, vitamin B1, B3, B6, B12 appear different degrees of increase, vitamin B5 market quotation chain rose more than 200%. Tracing the source, triggering a substantial increase in market prices is mainly due to the domestic market supply side of the two-way contraction.
On the one hand, environmental protection policies in recent years continued to tighten, the central and local environmental protection and safety inspection and other frequent supervision, at present, the central authorities have organized four batches of environmental inspection team, assigned to the provinces and municipalities for environmental protection work. Pharmaceutical raw materials due to the production process of high pollution, high emissions, production enterprises by environmental pressure to increase. For the field of vitamins, most varieties of oligarchs by a small number of enterprises oligopoly production, if some enterprises due to environmental shutdown, the supply side is bound to shrink sharply.
And, Shandong and Zhejiang are China’s vitamin production province, especially vitamin B5 and vitamin E, accounting for 68% and 36% of the total global production capacity. Lianxun Securities believes that environmental protection related enterprises to stop production or capacity reduction, support for vitamin prices continue to rise, optimistic about the vitamin B5 and the price of vitamin E. Vitamin raw materials industry will usher in due to environmental tightening, resulting in supply side contraction brought about by the overall price history opportunities.
On the other hand, in the international market, following the vitality of the leading enterprises BASF announced after four weeks, DSM recently announced in October began to stop production for about 6-8 weeks. Only vitamin A products, for example, the current global VA powder production capacity of about 30,000 tons, while the DSM and BASF two oligopoly capacity total reached 14,300 tons, accounting for 47.67% of global production capacity. Into the 9-10 months, VA manufacturers will be more obvious impact of the shutdown, and even institutions are expected, the upward trend will remain, VA prices are expected to rise to 450 yuan / kg.
Yesterday, Wind vitamin index rose 2.01%, in all 180 concept index rose among the top, Northeast Pharmaceutical, Brothers Technology, new and into a rise of 2.22%, 2.17% and 1.70%, Wei Xun Kang mass limit.
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Industry leaders are more benefit
Vitamin industry downstream demand is more stable, mainly for feed additives, pharmaceuticals, cosmetics and food and beverage, which accounted for 80% of feed additives. For the downstream feed business, vitamins are added with a clear standard for rigid demand. From the cost point of view, the total of about 12 varieties of vitamins, the overall cost of feed accounted for 2% -3%, and prices can be homeopathic shift to the downstream, large downstream enterprises have inventory advantages, price increases to enhance its competitiveness is more favorable. Guhai Securities analysts believe that this round of environmental protection limited to meet the low inventory, is expected to part of the small premix enterprises and even because of out of stock and forced to stop production. By then, I am afraid the price is high, the downstream may have to accept.
From the historical experience, the domestic feed production is more regular, the second half of the output will gradually increase, July, August and September is the main month of production growth, but also the season of vitamin procurement. According to the current inventory situation, is expected by the end of August – early September, supply and demand balance will reach an extreme.
Shen Wan Hongyuan Securities analyst Song Tao introduced recently, the mainstream of vitamin manufacturers shipped tight, has stopped single. With the fourth round of environmental protection inspection team stationed in Zhejiang, is expected to new and into, Zhejiang Pharmaceutical and other enterprises will be affected by the start. With the downstream feed industry is about to enter the demand season, VA price rebound is expected to continue, there are still close to doubling the current price increases.
At present, the environmental inspection team has begun to carry out inspections in Shandong and Zhejiang. Guohai Securities analysts pointed out that if the production enterprises to further limit production, supply and demand will be a serious imbalance, the supply side may be a substantial price increase to make up for the loss caused by the limited.
China Merchants Securities said that vitamin enterprises bargaining power is strong, while the downstream feed industry is more dispersed, while most of the varieties of technical barriers higher in the current environmental pressure under the circumstances, some small enterprises gradually clear, further enhance the industrial concentration. While the price elasticity of vitamin prices generally larger, once the price increases, the future price increases larger. Investors are encouraged to focus on the industry leader with stronger market competitiveness and more technical advantages.
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