Calcium Silicate Prices Remain Subdued in China and Germany Amidst Lacklustre Demand

In the Chinese and German markets, the pricing of Calcium Silicate displayed a state of weakness throughout July 2023, primarily driven by subdued demand from the downstream construction sector.

The Chinese manufacturing Purchasing Managers' Index (PMI) reported by trading economics remained below the threshold limit, with decreases observed in new orders and employment, while backlogs of work remained stable. Heavy rainfall further weakened the demand for Calcium Silicate, affecting Chinese regions' construction, cement, and ceramic industries. Moreover, the export of Calcium Silicate to overseas markets witnessed a contraction in July due to the prevailing subdued global trading activities among enterprises.

Manufacturers persisted in decreasing their inventories of Calcium Silicate due to subdued demand and notably enhanced delivery times, resulting in improved material availability. The market for Calcium Silicate was further impacted by rainy weather in various regions towards the end of July, affecting downstream concrete shipments and contributing to weak market demand.

During July, the demand for Calcium Silicate remained weak, primarily due to substantial declines in construction, ceramic, and clay mineral activities in Germany at the outset of the third quarter in 2023. Notably, a sharp decrease in new orders indicated reduced demand within the eurozone's largest economy. Consequently, builders opted to curtail purchasing activity and employment, reflecting growing apprehensions regarding future production. The interplay of higher interest rates, an inactive economy, and persistent construction costs has led construction companies to hold a significantly pessimistic outlook for the upcoming months. The deteriorating state of the order book significantly eroded business confidence, resulting in enterprises projecting their most conservative output estimations for the year since the preceding November.

Amidst a consistent supply of Calcium Silicate from traders, the product cost remained economical, driven by a sharp decline in demand from the construction industry. The traders observed no notable enhancement in demand for the product, owing to the ample availability of Calcium Silicate to meet domestic requirements. Notably, the construction industry's supply chains in the European region witnessed substantial improvement at the commencement of the third quarter. This improvement can be attributed to reduced pressure on supply chains, resulting from the decreased demand for construction materials and other production inputs. Consequently, the shorter delivery times were made feasible due to this easing of supply chain constraints.

A consistent and significant reduction in new orders primarily propelled the decline of Calcium Silicate. The weakening was exacerbated by economic and geopolitical uncertainties, compounded by stricter financial conditions, which collectively intensified pressure on demand.

Anticipated market trends suggest a potential decrease in Calcium Silicate prices within the German market, driven by the ongoing sluggish recovery of the construction sector in the region. Recent observations within various regions of China indicate that favorable weather conditions have significantly contributed to a rebound in demand. The mitigation of local waterlogging concerns, coupled with the resumption of work at several construction sites, has resulted in a modest uptick in sales. These developments hint at a possible improvement in the utilization of Calcium Silicate within the construction industry in China in the forthcoming weeks.