Methionine Price Dynamics

Methionine has shown high price volatility in the last few months. The prices of the commodity more than tripled between August and early November of 2014 before falling down by over 50% between late November and December of 2014. In this article we will look into the reasons of its high price volatility and supply shortages. We all also look into strategies which could be used by Methionine buyers in the volatile market. Introduction From August 2014, Methionine has shown high price fluctuation in China as shown below in the graph. Apart from China, Russia was also impacted by the rapid price rise. The sudden price rise was surprising because demand was low and prices were falling before August, 2014. The price increase was brought about by both decline in supply and increase in demand. However in the last few weeks the prices of the commodity have started declined rapidly. These factors seem to imply that the Methionine market is highly volatile making strategic sourcing an important cost saving tool while procuring this commodity. The animal feed industry has the largest exposure to methionine price rise. Hence the food and beverages manufacturers should be the most concerned as the animal feed industry is part of its value chain. Author: Sumeet Kumar