What are the key risks in DL-Xylose capacity expansion projects?

What are the key risks in DL-Xylose capacity expansion projects?
Capacity expansion in xylose is not without risk, as demonstrated by Huakang Pharma's experience. The company terminated its viscose fiber press liquor utilization project—which was intended to supply xylose feedstock—just three months after its IPO, citing the supplier's inability to provide sufficient hemicellulose alkali liquor. This underscores that raw material availability, often assumed in feasibility studies, can become a fatal flaw. The project had been justified by cost reduction and integration with xylitol production, but supply chain realities overrode those plans. Such incidents highlight the importance of securing long-term feedstock contracts before committing capital. For the broader market, this means that announced capacity additions may not materialize as planned, potentially keeping supply tighter than expected. Investors and buyers should scrutinize feedstock security when evaluating new xylose projects.