Bearishness Shrouded Global Polyoxymethylene Prices at the End of the Q4 2022
- 16-Dec-2022 3:55 PM
- Journalist: Francis Stokes
Hamburg (Germany): In the wake of poor trading fundamentals, the price of Polyoxymethylene (POM) globally maintained a bearish trend. Market participants claimed rising inflation and volatile natural gas prices continue to dampen demand in the downstream sector. Germany's POM profit margins continued to be jeopardized this week due to weak consumer sentiment and rising concerns about inflation.
To sell off their remaining stocks by the end of the year, major POM producers in Europe slashed their product prices slightly. Lower demand for POM from the downstream automotive and consumer electronics industries hurt Germany's market trading fundamentals. The price of POM in Germany settled at USD 4270 per ton FOB Hamburg at the end of the week on December 16, 2022.
In the US, the lack of demand from the downstream market and economic uncertainty hampered the POM market. POM demand declined due to lower market fundamentals and elevated energy costs, necessitating production reductions. Due to a lack of regional purchasing activity, export and domestic prices have followed weak price trends. Due to the decreased activity in their end sectors, suppliers have mostly been reluctant to raise their offers and have remained on the sidelines. The prolonged financial and economic crises have stifled trading and demand in the US market. The upcoming holidays and upstream crude and natural gas market fluctuations continue to upset trading activities. As per ChemAnalyst, the cost of POM hovered around USD 4187/MT on a FOB Pittsburgh basis during the week ending December 16, 2022.
According to ChemAnalyst, "while Crude Oil and natural gas prices fluctuated, POM is intended to follow a bearish market trend globally in the coming weeks. Since the market will be closed for a few days toward the end of December in order to celebrate the holidays, it is highly unlikely that demand will rise in the short term."