Bearish Downstream Demand Obstructs the Global Ethylene Acrylic Elastomer Prices
- 31-Aug-2022 5:47 PM
- Journalist: Nicholas Seifield
Since the beginning of August, prices of Ethylene Acrylic Elastomer have continued to drop across the Globe. The primary factor for the price decline was the abundant supplies, and sluggish demand from the downstream industries have provoked the price dynamics of Ethylene Acrylic Elastomer to stagger on a downward trajectory.
According to the latest data, German Ethylene Acrylic Elastomer prices plunged by 2.5% during mid-August. The climate crisis and energy-supply crunch have deteriorated the market sentiments for Ethylene Acrylic Elastomer in the domestic market. In addition, the logistics issues have declined, leading to an economic slowdown. As per the latest insight, high temperature and scant rainfall have drained water in the river, causing shipping delays and pushing freight costs up. In addition, the plummeted Ethylene Acrylic Elastomer values have been attributed to the negative cost support from the raw materials such as Ethylene and the weak demand from the downstream automotive sector. Further, the rapid interest rate increases by the U.S. Federal Reserve to combat inflation have slipped the euro's value against the dollar, broadening the trade deficit with overseas countries. Hence, as of result, Ethylene Acrylic Elastomer was offered at USD 2960/MT during the same time frame.
Meanwhile, in India, sufficient inventory level coupled with limited inquiries from the downstream automotive sectors have resulted in the price drop of Ethylene Acrylic Elastomer in the domestic market. Consequently, prices of Ethylene Acrylic Elastomer were quoted at INR 151623/tonne during August. On the other hand, the Japanese market showed similar market sentiments; according to the data, Japan's manufacturing activity contracted abruptly in August as output and new orders declined. Besides, mounting energy costs have dampened the demand from the downstream sectors. As a result, prices of Ethylene Acrylic Elastomer were at USD 1920/tonne during the same time frame.
According to ChemAnalyst estimation, "the price trends of Ethylene Acrylic Elastomer will follow the downward trend. In the meantime, the energy supply crisis will likely take a toll on the global downstream market. In addition, extreme weather effects and climate change will further deteriorate the supply chain."