Acetone Prices Surge in India Amidst Exorbitant Rise in Upstream Values
- 07-Mar-2022 3:33 PM
- Journalist: S. Jayavikraman
Acetone prices in India have witnessed a consistent surge since mid-February amidst the ongoing Russia-Ukraine war which has led to the steep rise in energy prices. As Acetone in India is largely imported from China, US and Germany, low operating rates in China and high energy values across globe is known to have caused the major uptick in its prices for a couple of weeks.
It was expected that Acetone prices would ease post-Spring Festival with gradual improvement in the plant operating rates in China. However, moving into March, Acetone prices witnessed another surge as the rise in upstream crude values overpowered the gradual increase in the production from China. A similar situation was observed in Germany, where manufacturers were compelled to transfer the cost pressure due to high crude prices upon consumers to safeguard their margins.
The rise in energy values has been a major concern for players as it has been hampering their margins despite the robust downstream demand. Industries across the globe are operating at optimum rates amidst a prominent surge in the demand. In India, Acetone prices have continued to stay firm amidst appreciable demand from the solvents segment following a consistent rise in consumption from coatings and cosmetics industry.
Acetone prices in India have surged by nearly 2.5% in the week ending 4th February. This is marked as the third consecutive rise in Acetone prices in the domestic market. Domestic players like Deepak Fertilizers and Hindustan Organics Chemicals Limited have revealed appreciable offtakes from the domestic market confirming the rich buying sentiments.
As per ChemAnalyst, “Acetone prices in India is expected to continue tracing an upward trajectory in the coming weeks as the value of upstream crude is unlikely to ease until the ongoing war between Russia and Ukraine is resolves. On the other hand, as the demand for Acetone is anticipated to remain firm in India, it is also expected to put forth an upward pressure upon its prices.”