The Chinese Metformin HCL market has been under pressure since January. The trend that started in December has continued as weak seasonal demand levels and sufficient supply continue to keep downward pressure on prices. For instance, in the second half of January, there was very little market activity. A lack of buying interest could be seen in the spot market; buyers were predominantly supplied by existing inventories from earlier in the quarter. Major API manufacturers maintained stable production rates during this time and ensured uninterrupted availability for the market. No supply-side tightening occurred to support prices. Export demand remained at very low levels, and overseas pharmaceutical buyers continued with a very conservative purchasing approach as many hold sufficient inventories and do not have an urgent need for product. As a result, sellers faced diminished negotiating power; thus, sellers were required to provide competitive offers to liquidate the inventory. Looking forward to February, the near-term price forecast shows that February will continue to prove to be a difficult market. However, buyers are expected to prepare for Q1 operational needs and for their inventory optimization cycles. They will begin purchasing toward the latter part of February, and as a result, pricing should gradually stabilize.
