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Bromine Market Faces Slowdown in the USA Amidst Low Demand and Strategic Destocking
Bromine Market Faces Slowdown in the USA Amidst Low Demand and Strategic Destocking

Bromine Market Faces Slowdown in the USA Amidst Low Demand and Strategic Destocking

  • 20-Dec-2023 4:13 PM
  • Journalist: Gabreilla Figueroa

Texas, USA: The Bromine market in the USA is currently experiencing a slowdown, with prices declining week-on-week due to low demand and increased offloading of domestic inventories ahead of the financial year closing. The demand for Bromine from downstream flame retardant and other end-use industries has remained sluggish due to surplus inventories in the domestic market. Additionally, the demand from the hydrobromic acid market has also been low.

According to a major Bromine manufacturer, the inflow of new orders from the overseas consumer market is slowing down. Consumers are destocking their inventories of Bromine and avoiding excess supplies to improve financial ratios and overall financial health. The operating rates among Bromine manufacturing industries have slowed down, as indicated by the manufacturing PMI data, mainly due to weak demand conditions. As of December 15th, 2023, the prices of Bromine Bulk CIF Houston were assessed at USD 2324/MT, reflecting a drop of more than 15% on a weekly basis.

In addition, consumer confidence in the U.S. experienced an uptick in November, marking the first increase in four months. This positive shift was driven by a somewhat improved outlook on future business conditions, despite concerns about an impending recession, persistent worries about inflation, and ongoing geopolitical uncertainties.

Despite facing higher interest rates, consumers in America demonstrated resilience by spending sufficiently, contributing to a robust 5.2% annual economic growth from July to September. This represents an upward revision from the government's initial estimate of a 4.9% annual growth rate for the last quarter. Additionally, the economy was boosted by the accumulation of inventories by companies in anticipation of prospective sales, contributing 1.4 percentage points to the quarterly growth. The third-quarter expansion was further propelled by increased spending and investment by governments at various levels, including federal, state, and local entities.

According to the ChemAnalyst database, the prices of Bromine are anticipated to continue declining as the consumption rate is presumed to remain low. Many businesses prioritize optimizing their financial statements as the fiscal year concludes, and strategic destocking in December is a common practice for companies looking to manage tax liabilities effectively.

In the backdrop of the holiday season in the USA, businesses may expect a temporary dip in demand for flame retardants such as Bromine, prompting proactive destocking measures to prevent holding surplus inventory. In certain industries, production schedules are strategically planned to accommodate reduced activity or shutdowns during the holiday season, leading to the adjustment of inventory levels, particularly in bulk chemical sectors like Bromine.

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