Calcium pantothenate is essential for all major species of livestock and pets given its role in the metabolism of proteins, carbohydrates, and fats. Pigs and poultry require supplementation of their feed with that vitamin.
Stefan Schmidinger, partner at Kemiex, said that Swiss trading and market intelligence group, informed its clients in a note on January 11 about major Chinese producers announcing hefty price increases for that vitamin, up to US$35-50/kg from US$10-20/kg over the past few months.
“Currently, markets are still in the process of finding a new price equilibrium and most spot trades are being negotiated between US$20 and US$30.
“Many buyers are sufficiently supplied from lower-price contracts in 1H 2021. Others are in wait-and-see mode and will re-assess after the Lunar New Year break,” he said.
A spokesperson for DSM, a key global player and producer of Calpan, told us the company has sufficient supply to meet its own internal premix demand and to meet previously agreed supply contracts with strategic customers.
A look back at volatility in feed additives
Price fluctuations in various feed additives and micronutrients have been a major concern for raw material buyers and sellers lately, in addition to delayed deliveries or force majeure situations.
In 2021, Choline chloride, Threonine, Lysine, Vitamin K3 (MNB and MSB), Tryptophan and Vitamin B5 saw the greatest level of upheaval, with annualized spot market volatility of around 30 to 60%, noted Schmidinger.
“A buyer of only US$100K worth of annual consumption could be exposed to losses of up to US$30K to US$60K if they got the timing or the contracting wrong, not considering potential losses from supply issues and production stops.”
In contrary to macro ingredients such as grains and oilseeds, there are no financial instruments to hedge price risks, he pointed out.
“Most buyers in Kemiex buy millions, or tens of millions of raw materials every year, multiplying the possible risk.”
