Amino Acids China E-News 1508(12 issues per year)

Date: 2015-09

“During this year’s two sessions (the National People’s Congress and the National Committee of the Chinese People’s Political Consultative Conference), there are signs about the slowdown of economic growth in China. GDP’s growth expectation is 7% in 2015.The slowdown this year is not an accident, but an intentional action of Chinese authorities to transform the investment and export-driven economy to the domestic demand-promoted economy. Later the State Council introduces some measures for ensuring steady growth, requiring more effective investment in key areas, to make sure the stable growth and a “”soft landing”” of China’s economy. However, China’s manufacturing Purchasing Manager Index (PMI) fell to 47.1 on Aug. 21 , for two consecutive month drop, which shows the weakness in both export and domestic demand. Output, new orders and inventories are deteriorating in some manufacturing industries.

Reviewing amino acid market this month, the exports of lysine decreased in May and June, both MoM and YoY. The price of methionine declined in July and August, it started to rebound in late Aug., but the market is still bearish. Many amino acid manufacturers choose to suspend production for an overhaul during the off season.

Apart from the weak market demand, amino acid manufacturers will have to face the pressure from environmental protection, a problem for a long time. After the blasts rocked a warehouse storing hazardous chemicals in Tanggu Development Zone, Binhai New Area, Tianjin Municipality, another explosion happened in a chemical plant in Zibo City, Shandong Province on 22 Aug. These accidents will no doubt make the authority pay more attention to the environmental protection and safety. Therefore, the introduction of eco-friendly new technologies will lead the way for future development. Leading enterprises enjoy innate advantages with abundant capital.

The USD/RMB exchange rate in this issue is USD1 .00=RMB6.11 69 on 3 August, 201 5, sourced from the People’s Bank of China. All the prices mentioned in this report will include the VAT unless otherwise specified.


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