The sucralose market may be subject to change

On November 4, "sugar substitute leader" Jinhe Industry issued an announcement that the company's annual output of 5,000 tons of sucralose solvent recovery building had a fire accident at 22:31 on November 3, the cause of the accident is under investigation, and it is expected that the accident will not have a significant adverse impact
on production and operation.

As the world's largest sucralose manufacturer, Jinhe Industry has an annual production capacity of 8,000 tons
.
The annual production capacity of the production line where the safety accident occurred reached 5,000 tons, which is the largest single-line production capacity
in the world.
The reporter of this newspaper then further asked the Jinhe Industrial Securities Department on this matter, the company said that the current sucralose production line has been completely stopped, the recovery time is not clear, but the company's other food additive production lines are still operating normally, not affected by the accident, the impact on the company's production and operation is subject to the previous announcement
.

Although the sucralose market itself is not large, the annual production capacity of 5,000 tons accounts for a considerable proportion of the total production capacity of sucralose in the country and even the world
.
The accident may have little impact on Jinhe Industry, but it may have a certain impact
on the sucralose market.

Sucralose is the fifth generation of high-power sweeteners, mainly used in the form of food additives in beverages, snacks, canned food, pickled foods, preserves and other fields
.
According to CITIC Securities Research Report, the global sucralose production capacity is about 24,600 tons, and China, as the largest producer, accounts for 68%
of the global production capacity.
Among them, Jinhe Industry has an annual production capacity of 8,000 tons, making it the world's largest sucralose manufacturer, accounting for 32.
5% of the world's total production capacity and 50% of the domestic market
.
In the past year, the prosperity of sucralose has continued to improve, driving the overall performance of Jinhe Industry to improve
significantly.
According to the third quarter report of 2022 released by Jinhe Industry, in the first three quarters of this year, the company achieved revenue of 5.
528 billion yuan, a year-on-year increase of 37.
54%; the net profit attributable to the parent was 1.
333 billion yuan, a year-on-year increase of 86.
79%; In the third quarter, it achieved revenue of 1.
928 billion yuan and net profit of 479 million yuan, both of which updated new quarterly highs
since listing.
Financial data shows that food additives such as sucralose contributed 51.
82% of Jinhe Industry's revenue in 2021, and this proportion rose to 61.
66%
in the first half of this year.

For the overall market of sucralose, Baichuan Yingfu data shows that in the third quarter of 2022, the average price of sucralose market was about 400,000 yuan / ton, an increase of more than 60% year-on-year, maintaining a historical high
.
The reason for the high price of sucralose in the third quarter is mainly due to the high demand
in the global sugar-free beverage market.
Guosheng Securities Research Report shows that under the global trend of low sugar, downstream demand has gradually increased, and sucralose has maintained a high prosperity
.
Shenwan Hongyuan's research report pointed out that due to the off-season industry maintenance and export recovery, sucralose supply and demand was slightly tight, and in the third quarter, domestic demand did not pick up significantly, but overseas orders increased significantly
since July.
However, since October, the sucralose market has been in a situation of weak supply and demand, and the price has fallen slightly, but it is still at a high level
.
From October 31 ~ November 4, the average price of sucralose market was 330,000 yuan / ton, which was still at a high market level
.

Previously, according to the market development situation, Guojin Securities believed that the market after sucralose was weak and stable
.
However, recent safety incidents have had an impact
on the market.
Industry insiders said that if the accident triggers a short-term production reduction, it is not ruled out that
the price of sucralose will accelerate upward.