C10 solvent market continues to be under pressure in Asia
- 29-Apr-2022 8:41 AM
- Journalist: Patrick Knight
This week, the prices of C10 solvent in the global market are continuing to trace uphill with strong market sentiments. The overall demand fundamentals for the solvent have been bullish since the start of 2022. Despite the demand from the downstream paints and coatings industry, the market growth is additionally driven by increased consumption from the downstream construction sector during summers.
According to the ChemAnalyst Database, the C10 solvent prices in Asia have witnessed a strong inclination of roughly 12 percent this month, compared to March. The root cause was the intensifying conflict between Russia and Ukraine which skyrocketed the already inflated Crude oil prices. A barrel priced for more than 110 US Dollars as per the OPEC market. Inflation might quicken more severely, and the Oil prices could increase yet again and remain elevated for more extended periods than expected, leading to increased cost pressures with higher commodity prices amidst the East European crisis.
In China, the situation is very different from any other country, as the economy is under strain battling the worst Covid outbreak. Supplies tightened on the back of pandemic restrictions, including recurrent lockdowns, factory closures, port limitations, delayed shipments, and container shortages. Thus, the supply-demand imbalances worsened as the inflation turned out higher in China.
However, the Asian market experienced lowering oil prices on Thursday. Despite the zero-covid policy, the rising covid cases in China weighed on market futures. Brent crude futures plunged around 0.4 percent and traded at USD 104 per barrel, while US WTI crude futures dropped nearly 0.3 percent and traded at USD 101 per barrel. Nevertheless, the oil prices will not stay down and could rise again in the coming weeks.
As per ChemAnalyst, “C10 solvent prices are expected to remain in pressure from soaring upstream Crude value in the forthcoming period. The market might experience increased supply contraction caused by the war as it peaks. If the pandemic flares up, the trade disruptions could prolong in the region, further increasing the solvent prices.”