For the Quarter Ending June 2024
North America
The second quarter of 2024 witnessed a noticeable decline in Gelatin prices within the North American market, driven primarily by a confluence of factors that exerted downward pressure on market dynamics. The quarter saw a significant contraction in business activity, characterized by a marked reduction in new orders and a shrinking backlog, indicative of a broader economic slowdown. Weaker-than-expected demand, combined with persistent inflationary pressures, further eroded consumer spending power, contributing to a softening in Gelatin prices.
Additionally, strategic decisions by importers to frontload imports in anticipation of the peak season led to an oversupply, exacerbating the price decline. This oversupply was compounded by challenges such as port congestion and geopolitical tensions, which disrupted supply chains and prompted bulk shipping at reduced rates. In the USA, the most pronounced price changes were observed, reflecting overall trends of declining demand and ample supply. The seasonal spike in demand typically associated with mid-year preparations was subdued, reflecting a cautious economic outlook. Compared to the previous quarter, prices decreased by -1%, and a further -1% drop was noted between the first and second halves of the quarter.
The latest quarter-ending price for Gelatin (BS - 150) Food grade CFR Houston was recorded at USD 7510/MT, underscoring a persistently negative pricing environment. The absence of reported plant shutdowns or significant disruptions adds clarity to the supply glut observed. Overall, the quarter has been characterized by a negative pricing sentiment, driven by a complex interplay of subdued economic activity, strategic market maneuvers, and overarching inflationary constraints.
APAC
In Q2 2024, the Gelatin market in the APAC region experienced a pronounced decline in prices, driven by a confluence of factors. Economic challenges, including subdued consumer confidence, persistently high interest rates, and inflationary pressures, significantly dampened demand. Persistent deflationary pressures led to reduced operational expenses, which were passed on to consumers, thereby lowering product prices. Market participants, grappling with oversupply, sought to clear inventories at lower quotations, compounded by insufficient new orders both domestically and internationally. Additionally, geopolitical tensions and logistical disruptions added layers of uncertainty, further reducing market activity. In South Korea, which experienced the most significant price changes, the market witnessed a clear downward trajectory. The manufacturing sector faced stagnant consumer confidence due to elevated interest rates and ongoing inflation, leading to cautious spending patterns. Geopolitical tensions, particularly those stemming from Middle Eastern conflicts, exacerbated market instability, prompting buyers to delay or reduce orders. The overall market sentiment remained bearish, with suppliers adjusting prices downward to manage excess inventory. Compared to the previous quarter in 2024, prices dropped by 1%, showcasing a discernible decline. The notable price difference between the first and second half of the quarter was recorded at -2%, reflecting the accelerating negative sentiment. The quarter concluded with the price of Gelatin (BS - 150) Food grade CFR Busan settling at USD 7350/MT, underlining a consistently negative pricing environment throughout Q2. The prevalent factors collectively signified a challenging quarter for the Gelatin market in South Korea, driven by both demand-side weaknesses and supply-side adjustments, reinforcing a distinctly negative market outlook.
Europe
The second quarter of 2024 has seen a notable decline in Gelatin prices across the Europe region, influenced by multiple intricate factors. A sluggish economic recovery, coupled with subdued consumer demand, has significantly impacted market dynamics. Inflationary pressures, though easing, have continued to suppress consumer spending, while geopolitical uncertainties, especially the escalating conflict in the Middle East, have exacerbated market apprehensions. Furthermore, logistical bottlenecks and prolonged lead times have strained supply chains, resulting in increased operational costs. Additionally, the European Central Bank's decision to maintain high-interest rates has further curtailed consumer expenditure, reducing overall market demand. This cautious economic environment has compelled businesses to adopt more conservative pricing strategies, contributing to a persistent decline in Gelatin prices. Focusing on Germany, the nation experienced the most pronounced price changes during this quarter. The economic downturn, marked by weak industrial orders and consumer sentiment, has led to a surplus of Gelatin inventories, driving prices downward. Seasonal demand fluctuations and a cautious approach by consumers have further intensified these trends. The price decline from the preceding quarter is recorded at 0%, with a marked -1% difference between the first and second halves of the quarter, underscoring the consistent downward trajectory. This quarter concluded with Gelatin (BS - 160) Pharma Grade FOB Hamburg priced at USD 8750/MT, reflecting an overall negative pricing environment.
For the Quarter Ending March 2024
North America
In the first quarter of 2024, the pricing dynamics of Gelatin in the North America region, particularly in the USA, were shaped by a diverse range of factors extending beyond traditional market drivers. Throughout this period, the pricing trend for Gelatin in the USA exhibited notable volatility and fluctuations, characterized by a combination of upward and downward movements.
The quarter began with a decline in prices, primarily attributed to cautious consumer sentiment amid sluggish retail sales and a backdrop of rising inflation. This cautious stance among consumers translated into reduced spending, consequently leading to a decrease in demand for Gelatin. Moreover, uncertainties stemming from inflationary pressures prompted consumers to adopt a more conservative financial approach, further dampening demand. However, prices experienced a notable increase in February and March, driven by an improvement in business sentiment fueled by a steady rise in new orders from end-users. This surge in demand outpaced the available supply in the domestic market, thereby driving Gelatin prices upwards. Additionally, challenges emerged in the supply chain, with disruptions at critical shipping chokepoints such as the Red Sea and the Panama Canal causing delays in product delivery, including Gelatin and other goods. These disruptions contributed to supply constraints in the USA market, further pushing prices upward.
Overall, the pricing environment for Gelatin in Q1 2024 witnessed fluctuations influenced by a combination of demand dynamics, supply chain disruptions, and prevailing economic conditions. However, it is important to note that the latest quarter-ending price for Gelatin (BS - 150) Food grade CFR Houston in the USA was USD 7780/MT.
Asia Pacific
In Q1 2024, Gelatin prices in the APAC region experienced fluctuations, with South Korea being the most pronounced market. The overall trend in Gelatin pricing was influenced by a range of factors beyond the conventional top three. While demand from downstream industries such as food and pharmaceuticals played a significant role in driving prices, other factors also impacted the market dynamics. Prices surged throughout the quarter due to improvement in business sentiments, fueled by a notable increase in new orders and inquiries. The depreciation of the South Korean won against the USD increased import costs, contributing to price increases. Additionally, inflationary pressures, particularly from energy prices, imposed additional operational costs on businesses, leading to higher prices. The market situation in South Korea was characterized by a surge in demand, surpassing available supply levels, resulting in price hikes. Anticipating a continued uptick in demand, market stakeholders strategically prioritized inventory replenishment and sought to capitalize on the prevailing market conditions by selling existing stocks at higher prices to optimize profitability. Finally, the final quarter's price for Gelatin (BS - 150) Food grade CFR Busan in South Korea was USD 7530/MT.
Europe
In the first quarter of 2024, the pricing dynamics of Gelatin in Europe unfolded amidst a complex landscape influenced by various factors. Initially, prices saw an uptick driven by geopolitical tensions, logistical challenges, and constrained inventories. Heightened demand from the end-sectors further contributed to this increase. However, prolonged disruptions in the Red Sea complicated trade routes between Asia and Europe, leading to increased freight costs that impacted the pricing scenario of Gelatin, especially in Germany. As the quarter progressed, prices experienced a decline in March. This decline was attributed to persistently lackluster performance in new industrial orders, coupled with insufficient domestic demand and a relatively high backlog. Additionally, the central bank's decision to maintain existing interest rates added complexity to the market environment, further straining consumers' purchasing power. In response, market suppliers and traders sought to address excess inventories amidst sluggish domestic demand, navigating through the evolving market landscape. Overall, the pricing dynamics of Gelatin in Europe during this period reflected the interplay of various factors, highlighting the challenges and intricacies of the market. Finally, the latest quarter-ending price for Gelatin (BS - 160) Pharma Grade FOB Hamburg in Germany was USD 8850/MT.
For the Quarter Ending December 2023
North America
The Gelatin market in North America encountered various factors affecting prices in the fourth quarter of 2023. Initially, prices experienced a moderate increase driven by sustained demand from the food and pharmaceutical sectors. However, they later declined due to elevated interest rates and inflationary pressures, leading to a reduction in consumers' purchasing power.
Specifically, the Gelatin market in the USA witnessed a price increase in October, with Gelatin (BS - 150) Food grade and Gelatine (BS - 220) Food grade prices rising by 0.78% and 0.55%, respectively. The surge in prices was driven by increased demand from end-users, limited inventories, and higher transportation costs. However, prices experienced a decline in November and December due to a global decrease in demand for Gelatin. Faced with excess supply and the potential for reduced demand, manufacturers and distributors responded by offering discounted quotations to clear surplus inventory, especially towards the end of the year.
In terms of price comparison, the Gelatin prices in the current quarter increased by 14% compared to the same quarter in the previous year. However, there was a decrease of 3% in prices from the previous quarter. The price comparison between the first and second half of the quarter also showed a decline of 3%. The quarter ending price for Gelatin (BS - 150) Food grade CFR Houston in the USA is USD 7520/MT.
APAC
In the fourth quarter of 2023, the Gelatin market in the APAC region experienced various factors that impacted prices and market dynamics. Initially, prices surged as a decline in imports from key exporting countries led to constrained supply, coupled with sustained demand in the domestic market. Afterwards, Gelatin prices were impacted by subdued consumer sentiments, attributed to economic slowdown and high interest rates. This resulted in low demand for Gelatin in the food and beverage industry. In South Korea, Gelatin prices experienced notable fluctuations, rising in October due to the rapid acceleration in energy prices and reduced imports in the domestic market. However, prices declined in November and December, influenced by factors such as shifting consumer preferences, economic slowdown, and competition from alternative ingredients. Overall, Gelatin prices in the APAC region during Q4 2023 were shaped by a combination of factors, including consumer sentiments, demand and supply dynamics, and evolving market conditions. The latest price of Gelatin (BS - 150) Food grade in South Korea at the end of the quarter was USD 7230/MT CFR Busan.
Europe
The Gelatin market in Europe during the fourth quarter of 2023 was influenced by several key factors. Firstly, there was a decrease in overall demand for Gelatin due to subdued consumer spending and reduced consumption. This was attributed to the persistently high interest rates set by the European Central Bank, which limited purchasing power and dampened consumer sentiments. Additionally, the availability of alternative ingredients such as agar and pectin further contributed to lower demand in the market. The ample supply of Gelatin in the European market was maintained, driven by the strengthening of the Euro against the US dollar, making exports more expensive and resulting in a slowdown in exports to other nations. In Germany, the largest economy in Europe, Gelatin prices experienced a significant decrease of 7.62% in September compared to the previous month. This decline can be attributed to the high inflation rates in the country, driven by rising food and energy prices. The manufacturing sector in Germany also faced challenges, with a decline in demand and production levels. The quarter ending price for Gelatin (BS - 160) Pharma Grade FOB Hamburg in Germany was USD 8530/MT.
For the Quarter Ending September 2023
North America
Gelatin prices demonstrated a mixed trend in Q3 and declined in July and August by 2.03% and 0.91% respectively but increased in September by 1.05%. Business activity in the United States dropped in the third quarter due to reduced demand from both local and foreign markets. In the United States, inflation increased to 3.7% in August for the first time since June 2022, as a strong increase in energy costs drove prices higher at the end of the summer, impacting even more on consumer confidence. Inflationary pressures indicate that the US economy is straying away from the Federal Reserve's 2% goal rate, forcing policymakers to contemplate hiking interest rates later this year. The Federal Reserve hiked its key policy interest rate by 0.25 percent in July, the eleventh time in 17 months, to combat persistent inflation in the US economy, which has resulted in decreased market demand. In September, the Consumer Price Index climbed 3.7%, slightly more than the 3.6% projected. Energy costs climbed 1.5%, with gasoline prices increasing 2.1% and fuel oil prices increasing 8.5%. Furthermore, Chinese shipments were also slowed down, keeping Gelatin prices high. With the termination of Q3, the prices settled at USD 7730/MT CFR Houston.
Asia Pacific
Gelatin prices declined by 0.82% and 1.24% in July and August respectively but increased in September by 1.12%. The Chinese economy has faced new obstacles and constraints, impeding economic development. According to the National Bureau of Statistics (NBS), the official manufacturing PMI (Purchasing Managers' Index) was 49.3 in July. This score, however, remained lower than 50, indicating shrinking rather than growth. Lower international orders and sales have hampered commercial and industrial activity. Inflation and rising interest rates in the United States, Europe, and key export markets continue to weigh on Chinese demand, with the new export order sub-index falling for the sixth consecutive month in August. Furthermore, China's central bank lowers its primary interest rate amid economic worries, which helps to encourage market spending, resulting in soaring Gelatin prices in China. China's manufacturing purchasing managers' index (PMI) softly rose back into the growing zone in September, revealing the restoration of industrial activity and reflecting an optimistic economic rebound inside the country. With the termination of Q3, the prices settled at USD 7230/MT FOB Shanghai.
Europe
The prices of Gelatin in Germany have experienced a significant decline of 9.35% during the month of September, ever since the commencement of the third quarter. The purchasing managers' index (PMI) in Germany decreased to 41 in July, reflecting a sustained decline in new orders from both domestic and foreign markets despite adequate stocks among market players. Furthermore, consumer confidence remained low in August as a result of persistent rate rises, rising inflation, the oil crisis, and geopolitical issues. The ongoing high rate of inflation, spurred by high energy and oil costs, weakened consumer buying power and assisted the decrease in Gelatin prices. Germany's industrial sector, which accounts for around one-fifth of the country's economy, continued in a downturn in September, owing to slow demand and rapidly dropping output, which also caused Gelatin prices to fall. In September, the European Central Bank agreed to raise interest rates for the eleventh time in a row in order to battle persistent inflation, which has maintained market demand on the lower side and sustained the downward trend. With the termination of Q3, the prices settled at USD 9700/MT FOB Hamburg.
For the Quarter Ending June 2023
North America
In the second quarter of 2023, the US Gelatin market experienced fluctuating market sentiments. The first two months of the second quarter saw steady price gains due to hampered supply and demand dynamics. Due to increased demand from end-user suppliers, there is a moderate shortage of Gelatin on domestic warehouse shelves, leading to price hikes in the market. In late Q2, prices finally began to fall due to weak demand, which led to excess inventory, which forced suppliers to lower their prices. The ongoing economic instability in the US and the rising global inflation rate have also contributed to the decline in demand for Gelatin. Trade between Asia and the United States increased since the zero-resistance policy against COVID-19 was abolished. Also, the production costs of Gelatin have increased in recent months due to the rising prices of corn and other inputs. However, distributors are hesitant to place large orders due to the falling prices. Major players in the market are expected to reduce prices in the coming months further. Distributors and suppliers are not restocking their inventories as they are still trying to clear the surplus.
South America
The Gelatin market in the second quarter of 2023 in the South American region showcased an oscillating trajectory. At the commencement of Q2 till the mid of Q2, the Gelatin market showed stable price inflation due to soaring domestic and international orders. The producers of Gelatin noted a sharp reduction in volumes of new orders amid political uncertainty and high-interest rates, which hampered Brazil's domestic market during April. In addition, supply chain disruptions due to ongoing geopolitical disputes have further reduced Gelatin supplies, resulting in upward pressure on prices.The increased production rates to refill the inventories with fresh stock and cater to the upcoming demand market situation remained strong. Later with the termination of mid-Q2, the prices fluctuated, and the prices witnessed to deflate significantly. The demand for Gelatin has decreased due to lower demand from end-user consumers, including the food and beverage industries. Decreased commodity prices and more supply amid weakening demand further put downward pressure on prices.
APAC
The Gelatin market in the second quarter of 2023 in the Asia Pacific region showcased a mixed trajectory. At the commencement of Q2 till the mid of Q2, the Gelatin market showed stable price inflation due to soaring domestic and international orders. The increased production rates to refill the inventories with fresh stock and cater to the upcoming demand market situation remained strong. The supply of Gelatin has been somewhat constrained, due to several factors, including production disruptions in China and the ongoing war in Ukraine. This reduced supply has also contributed to the increase in prices. China's exports saw a better-than-expected market situation as consistent inquiries from the domestic and international markets remained above average.Later with the termination of mid-Q2, the prices fluctuated, and the prices witnessed to deflate significantly. In addition, this price trend was mainly due to a decrease in sales in final consumption areas, and there were no new inquiries from domestic and overseas suppliers. Demand from downstream industries declined in recent months. Due to a large inventory of Gelatin in the warehouse, the supplier had to reduce the price to reduce the existing inventory.
Europe
Thesecond quarter of 2023 saw a mixed trajectory in the European market for Gelatin. As the second quarter began, prices decreased, backed by reduced imports of raw materials from exporting countries like China and chronically low downstream industry demand. Additionally, the cost of shipping goods by sea has decreased due to recent rates between China and Europe returning to pre-pandemic levels and a major reduction in congestion, both of which influence the state of the company. Later, in the month of May, the prices rose due to the gap between the supply and demand side of the market. The price hike was exacerbated by a national surge in domestic inquiries. However, dealer inventories were sufficient to cover gross demand for the month. That said, another factor supporting this increased demand for Gelatin is the appreciation of the Euro against the US Dollar. Unexpected production cut decisions by OPEC+ members also had a positive impact on the market environment. Higher energy costs, higher production costs, and higher transportation costs all contributed to the continued strength of the market. Speculative trading has also contributed to the increase in Gelatin prices. Speculators are buying Gelatin in the hope that prices will continue to rise. This has further increased demand for Gelatin and put even more upward pressure on prices.
For the Quarter Ending March 2023
North America
The first quarter of 2023 saw fluctuation in the North American market for Gelatin. Early in January, strong market sentiment for Gelatin began to emerge across the USA; it persisted until the end of the month as a result of ongoing orders from domestic consumers. Additionally, traders encountered the most expensive import from China as the Chinese currency appreciated against the US dollar, rising by roughly 3% in just January. Due to regular orders from the end-user sector, Gelatine's price trend remained steady in February. As a result of the supply and demand being in balance, the market dynamics remained unaltered. Gelatin prices continued to decline in March due to regular orders from the end-user industry. As a result of the supply and demand being in balance, the market dynamics remained unchanged. Towards the end of the quarter, the Gelatin (BS -150) Food grade prices were assessed around USD 7820/MT for CFR Houston in March.
Asia Pacific
Gelatin price in the Asia Pacific region inclined in the first quarter of 2023 for a variety of reasons. Gelatin prices in China have remained stable and on the higher side as a result of steady demand from end-use industries and limited supply. The primary cause of this price trend's stagnation was the market's normal equilibrium between supply and demand. Because China's market dynamics remained favorable, Gelatin prices rose again in February. High end-user industry purchasing activity, rising demand, and falling supply were the primary factors for this growth. March saw a further rise in the price of Gelatin as China's market dynamics persisted. High end-user industry purchasing activity, along with rising demand and falling supply, were the primary factors for this growth. Towards the end of the quarter, the prices for Gelatin (BS - 150) Food grade were assessed around USD 7280/MT for FOB Shanghai in March.
Europe
The Gelatin market in Europe fluctuated during the fourth quarter of 2022. The price incline observed in the first half of the quarter was influenced by consistent offtakes and insufficient stockpiles. Due to the ongoing downturn of the German market, the price of Gelatin decreased further. Rising supply and moderate to low purchasing activity from end-user industries, particularly the pharmaceutical industry, were the main contributors to this reduction. Throughout the quarter, offtakes in the region's downstream industries remained steady. Towards the end of the quarter, the prices for Gelatin (BS - 160) Food grade were assessed around USD 10200/MT for FOB Hamburg in March.
For the Quarter Ending December 2022
North America
The Gelatin in the North American region showed a mixed price trajectory in the Q4 of 2022. In the USA, Gelatin price escalated a total of 7.8% for Gelatin (BS-150) and 1.4% for Gelatin (BS-220) until November of 2022 before dropping 1.7% and 1.1% in December. Inventories of Gelatin were low in the domestic market due to rising feedstock costs which impacted production. Due to slow imports and a lack of truckers, the U.S. market for Gelatin remained tight. In addition, the cost of logistics had grown, mostly as a result of containers becoming stranded at ports or at sea and a lack of workers to unload the ships. In December, prices decreased as the country finally started to recover, as the U.S. supply chain gradually became better with reduced ship backlogs at the east coast port significantly. The reduced demand brought on by slower consumer spending resulted in slow manufacturing activity in December. Therefore, by the end of the quarter, the CFR Houston prices for Gelatin (BS-150) and Gelatin (BS-220) settled at USD 7985/M.T. and USD 8920/M.T. in December 2022, respectively.
Asia- Pacific
During the fourth quarter of 2022, the price of Gelatin across the Asia Pacific region displayed an upward price trajectory. Between October and December, the FOB Shanghai price in China increased from USD 6520/M.T. to USD 7100/M.T. for Gelatin (BS-150) and USD 7940/M.T. to USD 8045 /M.T. for Gelatin (BS-220). The prices of Gelatin in the Chinese market were affected by the strong demand from a number of end-user pharmaceutical and healthcare industries. Low inventories among domestic merchants as a result of the suspension of manufacturing activities over the Golden Week holidays in the first week of October helped the price trend in the market. Following a one-week holiday and the market's reopening, domestic traders met several contradictory signals, making it challenging for the participants to keep up with the slow progress witnessed in the downstream industries. Government officials altered its zero-covid policies in response to complaints and significant dissatisfaction in the nation, putting the nation susceptible once more in the second half of the fourth quarter of 2022.
Europe
Gelatin's market dynamics in Europe were comparable to those in North America and the Asia-Pacific region. However, until November 2022, Gelatin's price increased. The price hike was prompted by supply shortages and continuous demand from end-user industries. Additionally, in order to enhance profit margins, domestic firms had to alter their product lineups as import costs rose. Later in December, weak purchasing activity was seen as a result of decreased demand from the local market, which led to a decrease in price. Due to their misgivings about the availability of merchandise, regional dealers in Germany lowered prices to entice customers.
For The Quarter Ending September 2022
North America
In North America, the prices surged around 4.2% for Gelatin (BS-150) and 4.8% for Gelatin (BS-220) due to favorable sentiments in the regional market during the third quarter of 2022. However, the insufficient product availability in the USA because of inadequate supply from China caused USA's buyers to import Gelatin at an inflated price from Brazil, prompting the price rise. Since China is a significant exporter of Gelatin to the USA, the shutdown of a few production units for maintenance caused a low output, hindered supplies, and disrupted trading activities of the products. Therefore, by the end of the quarter, the CFR Houston prices for Gelatin (BS-150) and Gelatin (BS-220) settled at USD 7525/MT and USD 8890/MT in September 2022, respectively.
Asia- Pacific
In Q3 2022, the Gelatin market witnessed positive market sentiments in the Asia-Pacific region, with prices following an upward trajectory due to the shortage of inventories in the market and heavy demand from the end-user sector. Industrial Gelatin manufacturing was in a low phase from July to September in China because high temperatures led to dull jelly strength and quality issues. Few factories in China, notably Ysasin Industry, a significant Gelatin producer, were involved in maintenance tasks to make sure the highest quality Gelatin to its purchasers. Therefore, for the quarter ending in September, the FOB Shanghai price of Gelatin (BS-150) and Gelatin (BS-220) in China settled at USD 6145/MT and USD 7680/MT with a quarterly inclination of 5.1% and 5.3%.
Europe
Similar market dynamics were observed in the European region during the third quarter of 2022. However, Gelatin prices climbed significantly in Germany due to a tight supply of the product in the regional market and rising requirements from the end-use pharmaceutical, food, and cosmetic manufacturers. Moreover, the weak production activities of the manufacturing plants in Germany's domestic market ushered in disrupted international trade, further pushing the Gelatin food grade prices. In addition, rising production costs, rerouting of transportation, and a cargo scarcity that increased freight costs all affected pricing in the market. Thus, Gelatin prices in Germany were assembled at USD 7360/MT in September 2022.
