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Asian n-Propanol Prices Surge Due to Increased Feedstock Costs and Rising Demand
Asian n-Propanol Prices Surge Due to Increased Feedstock Costs and Rising Demand

Asian n-Propanol Prices Surge Due to Increased Feedstock Costs and Rising Demand

  • 21-Aug-2023 12:44 PM
  • Journalist: Francis Stokes

The n-Propanol price trend recently shifted and showcased a bullish movement in Asia. The n-Propanol price rose by almost 1% during the week as the upstream cost support was firm due to noticeable increases in the feedstock Ethylene costs from the past few weeks because of the escalation in upstream Naphtha prices.

At the same time, procurement activities of n-Propanol were average, and demand increased from the regional buyers as consumption rates increased from Herbicides and Insecticides manufacturers. Meanwhile, the orders for n-Propanol were stable from cleaning agents and ink manufacturers.

The prices of n-Propanol were dropping consistently during May and June 2023. Meanwhile, at the beginning of July, n-Propanol prices reduced negligibly amid the end of the destocking practices by the domestic producers and suppliers. Then the n-Propanol price trend revived and started increasing in Asia. The consumption rates were stable in the Pharma sector. At the same time, offtakes were reduced for ink used in food packaging amid the global rise in food inflation. Then, from the 2nd week of July, increases in the feedstock Ethylene prices amid increased demand from Polyethylene producers and escalation in the upstream Naphtha prices during the past few weeks. It raised the production costs of n-Propanol.

Meanwhile, China's manufacturing Purchasing Manager's Index witnessed a marginal drop during July 2023 and recorded below 50, indicating a slight contraction in the manufacturing sector activities. Inventory levels of n-Propanol rose in China due to declined export rates amid decreased production rates and a slowdown in economic conditions. Simultaneously, the disruption in supply chain activities increased the logistics duration. Meanwhile, the demand depressed from plasticizer and PU coating manufacturers due to weak activities in the construction sector.

As per the ChemAnalyst data sources, n-Propanol prices fell by 2.1% in China in the past couple of months and almost 7% in South Korea. At the end of 3rd week of August, the n-Propanol prices in China and South Korea hovered at USD 1130/MT and USD 940/MT, respectively. The decrease in input costs in South Korea reduced the cost support on n-Propanol prices.

As per the estimation, "the n-Propanol price trend is likely to improve, and prices will increase in the Asian region. The increasing feedstock Ethylene prices due to supply chain disruption and increasing upstream Naphtha prices are raising the cost support on n-Propanol production costs. Meanwhile, demand is firm from Insecticides and Herbicides manufacturers due to the rise in global food inflation amid increased consumption rates in the horticulture sector of key importer India."

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