For the Quarter Ending September 2023
During the third quarter of 2023, the cost of Dextrose in CFR New York rose from $695 to $705 per metric ton between July and September, marking a positive conclusion for the period. This upward shift, with an average quarterly increase of 0.73%, reflected a clear preference for higher price levels. The domestic nutraceutical market for Dextrose in the United States exhibited an upward trend, primarily fueled by consistent demand from various end-user sectors. Limited to moderate inventory levels prompted sellers to incrementally raise prices each month, playing a crucial role in supporting the optimistic price trend. Additionally, the latter part of the quarter saw an increase in import costs due to fluctuations in the exchange rate between the US dollar and the Yuan. Despite a slight slowdown in inflation in the third quarter, market participants remained cautious due to the Federal Reserve’s decision to increase interest rates. Warehousing costs, warehouse utilization, and inventory expenses surged in the first week of July, contributing to price hikes for commodities like Dextrose, driven by rising costs associated with inventory management and storage. In summary, it is likely that importing countries followed a similar trajectory to exporting countries during this period.
In the third quarter of 2023, Dextrose prices in Asia Pacific experienced a noticeable increase, rising from $580 to $594 per metric ton on an FOB Shanghai basis from July to September. This trend indicated a movement towards higher prices, with an average quarterly increase of 2.00%. China, the world’s second-largest economy, faced slower-than-expected growth in the first half of 2023, extending into the latter part of the year, casting a negative shadow over the beginning of the third quarter. Contributing factors to the increase in Dextrose prices in China included the strengthening of the Chinese Yuan (RMB) against the US dollar and heightened local demand from end-user businesses. The resulting higher export costs, driven by the strengthened Yuan and weakened US dollar, impacted both domestic and international markets. Increased demand and disruptions in the supply chain created an imbalance, putting upward pressure on prices. As September approached its end, a slight uptick in shipping and manufacturing costs occurred due to a surge in demand and inquiries just before the Golden Week holidays. Strategic bulk purchases by market participants looking to replenish inventories also contributed to the price hike, intensifying overall demand during the holiday season.
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In the third quarter of 2023, Dextrose prices in Europe displayed a consistent pattern, increasing slightly from $670 to $684 per metric ton CFR Hamburg between July and September. This trend resulted in a notable price hike, with an average quarterly growth of 1.21%. As the economy stabilized and showed signs of improvement in July, German Dextrose suppliers responded by placing significant orders to restock inventories and meet growing demand within the country. However, challenges persisted in the German manufacturing sector as the third quarter began. Responding to increased inquiries from local companies, importing Dextrose from Asia, particularly China, remained an appealing option throughout the quarter. The depreciation of the Euro played a significant role in the price increases in Germany, as the strong US dollar compelled domestic businesses to pay higher prices for imported goods from China. High inflation and a challenging manufacturing environment continued to impede growth on the economic front, causing market investors to maintain a cautious stance.
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