Vitamin C export, domestic price analysis

Export form: "small profits but quick turnover"

According to statistics from the Customs, in 2010, China exported a total of 114,700 tons of vitamin C, a year-on-year increase of 46.87%. From January to February of this year, it exported 20,500 tons, an increase of 25.45% year-on-year. Since the end of 2009, the National Development and Reform Commission and the Ministry of Industry and Information Technology have investigated the serious overcapacity in the Vitamin C industry, and plan to rectify the situation with heavy punches. In just over a year, China’s vitamin C export volume has exploded. 40,000 tons, equivalent to half of the normal annual shipments. The average export price has been decreasing month by month. The average price in 2010 was only US$6.96/kg, which was a decrease of US$3.18 per kg from 2009, a year-on-year decrease of 31.36%; the average price of vitamin C exports from January to February 2011 was only US$5.53. /kg, a year-on-year decrease of 36.83%.

The top ten destination countries for vitamin C exports in China in 2010 were the United States, Germany, Japan, Belgium, the Netherlands, Brazil, Italy, the United Kingdom, South Korea, and Indonesia. Last year, China’s exports to the above-mentioned ten countries all increased at different levels. The largest increase was in Italy, which was a year-on-year increase of 97.27%, followed by Germany, which was a year-on-year increase of 67.21%. The smallest increase was in the United Kingdom, which was a year-on-year increase of only 0.63%. It can be seen that the market pattern of vitamin C has not changed and the demand in the mainstream market remains strong. Emerging markets such as Chile, Turkey, Russia, and Nigeria enjoyed good growth, with export growth above 100%.

Compared to the increase in the quantity, the export price of vitamin C has been falling all the way. In the top 20 export rankings, the export prices have fallen by more than 26%, of which the export prices to India have fallen by a large margin, reaching 46.86%.

In January-February 2011, the EU and Asian markets continued to maintain a rapid growth of 45.51% and 47.97%, while the US market tended to be stable with an increase of only 1.94%.

Domestic price patterns: The downturn of vitamins belongs to the raw material medicine industry. China's raw material medicine sales revenue from January to March 2011 was 66.1 billion yuan, a year-on-year increase of 22.30%, and total profit increased by 12.01% year-on-year. However, the price of vitamin products is still hovering at the bottom, and prices in the market can be expected to increase.

With the increase of consumers’ health awareness, the vitamin market continues to expand. However, due to the low barriers to entry of such products and the fast cycle of profit return, leading to a large number of manufacturers, there is still a low-end consumer market in the competitive landscape of products that mix and match products and products under the sand. With stricter supervision, more sensible consumers and market competition for survival of the fittest, the future vitamin market will be completely reshuffled, and will tend to the big brand, high quality, segmented, and specialized market structure.

The current capacity of the vitamin C industry is in a surplus state, and the price is at a low level. In March 2011, the export price was 5,681 US dollars per ton, which was lower than the financial crisis at the end of 2008 at the beginning of 2009; in order to standardize the production of vitamin C industry, the Ministry of Industry and Information Technology took the lead in formulating "Vitamin C industry access conditions" is expected to be introduced in the near future, will regulate the vitamin C industry from energy consumption, technical level, environmental protection, safety and other aspects. Aijian Securities is expected to regulate the vitamin C industry. It is relatively beneficial for the domestic leading vitamin C industry, Northeast Pharmaceutical, and North China Pharmaceutical.