Category

Countries

Amid Global Shipping Turmoil and Bullish Raw Material Prices, European Phenol Prices Escalate
Amid Global Shipping Turmoil and Bullish Raw Material Prices, European Phenol Prices Escalate

Amid Global Shipping Turmoil and Bullish Raw Material Prices, European Phenol Prices Escalate

  • 29-Jan-2024 2:39 PM
  • Journalist: Robert Hume

Hamburg, (Germany): Since the beginning of January 2024, Phenol prices have been steadily increasing in European nations. This rise can be attributed to a variety of factors, including a significant decrease in crude oil shipments from the Middle East to Europe due to ongoing attacks by Yemen's Houthi rebels. These disruptions, the most significant since the COVID-19 pandemic, have coincided with increased Chinese demand, creating fierce competition for crude supply routes that bypass the Suez Canal. This heightened competition has led to bullish price trends in the crude oil market, consequently affecting the manufacturing costs of downstream derivatives, including Phenol.

The ChemAnalyst database has shown that Phenol prices have witnessed an increment of approximately USD 80 per ton on the week ending January 26 compared to prices observed at the start of this month. The reduced operating rates of Phenol manufacturing firms have led to limited supplies of finished products. In addition, the cost support from upstream Benzene has also escalated as its prices remained on the higher end throughout the given timeframe. However, amidst the series of unfavorable market movements, market players remain optimistic and expect that the shipping disruptions in the Red Sea and the Panama Canal, which were influencing chemical prices, could also speed up downstream companies' restocking activities, potentially resulting in increased Phenol demand.

On the other hand, two major Phenol manufacturing plants, INEOS Chemicals and Shell Chemicals, have undergone Force Majeure in the USA. However, it has caused no major impact on Phenol prices as procurement levels from downstream Bisphenol industries have remained average. According to market sources, after the holiday season in Q4-end, demand from the terminal markets was basically on immediate requirements.

According to the pricing intelligence of ChemAnalyst, the prices of Phenol might sustain a bullish run across the European market. As per market players, while weak demand in Europe has helped to lessen price volatility in various product categories until now, the presence of low inventories still poses a significant risk for potential price increases in the forthcoming weeks. However, with the commencement of the Spring Festival Holidays in China, demand from the Bisphenol A industries might remain subdued, weakening the pricing dynamics of Phenol in the Asian markets. On the other hand, Israel's offensive against Gaza shows no signs of stopping, and attacks by Iran-aligned Houthis on commercial vessels in the Red Sea persist despite US retaliatory measures further impacting the freight rates for major trade routes.

Related News

Mitsui Chemicals Announces Closure of Phenol Plant at Ichihara Works
  • 05-Apr-2024 11:05 AM
  • Journalist: Francis Stokes
German Phenol Prices Ignite Amidst Supply Constraints and Raw Material Costs; South Korea Holds Steady
  • 03-Apr-2024 3:18 PM
  • Journalist: Jung Hoon
Sinopec Increases Phenol Prices in East China
  • 19-Feb-2024 6:47 PM
  • Journalist: Li Hua
European Phenol Prices Turn Bullish, Contrary to Stagnancy in Asia in Mid-Q1
  • 15-Feb-2024 2:36 PM
  • Journalist: Patrick Knight