Analysis of the demand for p-aminophenol API in India during the epidemic period

      China is the world's largest API producer and exporter of para-aminophenol raw materials, and India is the number one importer of the product, accounting for 65%-75% of China's total exports.Since March 2020, the Indian government has repeatedly restricted the export of a variety of raw materials and preparations, and its production capacity of APIs and finished drugs is not self-sufficient due to the low production and lagging international logistics affected by the epidemic.
      According to Health.com, total exports of paracetamol raw materials in 2020 amounted to about 40335 tons, up 9.98% from 2019, while exports to India amounted to 31051 tons, up 14.36% from 2019. After India restricted the export of paracetamol and paracetamol preparations, the demand for the upstream product para-aminophenol is even more unabated. Conversely, from the perspective of India's imports, the total import of p-aminophenol raw materials in 2020 was 28,576 tons (there are differences in statistical time periods, and the difference between China's exports is about 2,475 tons), of which the share of the quantity from China accounted for more than 98%. This shows that the dependence of the product on China is quite high.
      There are less than 30 purchasers of p-aminophenol raw materials in India, of which the top 3 companies account for 85% of imports, and the suppliers are relatively more concentrated compared to Chinese suppliers.
      Among them, Granules India Limited is a professional manufacturer of pharmaceutical formulations. It provides one-stop formulation services to pharmaceutical companies. From the production of several strategic APIs to multiple drug semifinished products to finished doses of tablets and capsules. The company procured 13532 tons of para-aminophenol for the year 2020, accounting for 47.36% of the total procurement in India.
      Sri Krishna Pharmaceuticals Ltd was established in 1974 and is headquartered in Hyderabad, Telangana. It is a company specializing in the mass production of defense drugs. It has a complete chain of production lines from APIs to pressed granules to finished formulations. The company procured 7,406 tons of para-aminophenol for the year 2020, accounting for 25.92% of the total procurement from India.
      Bharat Chemicals, founded in 1982 and headquartered in Mumbai, the business capital of India, is one of the leading manufacturers of paracetamol (acetaminophen or APAP) in India, with a capacity of nearly 4,000 tons of paracetamol per year. It has a significant global presence. The company procured 3,322 tons of paracetamol for the year 2020, accounting for 11.63% of India's total procurement.
      Since the epidemic, the price of paracetamol has risen all the way to exceed $4/kg by the end of the year (see chart). 2020 India's import of Chinese paracetamol APIs has remained stable to slightly higher, and the current domestic market price is still on an upward path compared to the fourth quarter of last year. Mainly because the largest producer Anhui Bayi Chemical Co., Ltd. old plant relocation to stop production, so the supply is very tight, most domestic enterprises have stopped the external offer, a small number of enterprises offer up to ¥ 40 yuan / kg +, an increase of more than 30%.
      The global new crown epidemic is still not over, antipyretic and analgesic drugs have been an indispensable part of the auxiliary treatment drugs. As the upstream product of paracetamol, paracetamol has indirectly made a significant contribution to the epidemic. The Indian market, as the main export region of paracetamol API in China, has a strong dependence on Chinese APIs. In addition, India announced in June 2020 to support the production of domestic APIs and reduce the dependence on Chinese APIs, which will have a significant impact on China's API enterprises. Therefore, China's relevant API enterprises, should start planning more coping strategies and new development direction.