Cumene Prices Rises in the Global Market amidst strong Crude Oil Values
- 31-Mar-2022 9:52 AM
- Journalist: Timothy Greene
Cumene prices witnessed an upsurge in the global market due to the disruption caused by the Russia-Ukraine war which has led to the rise in prices of upstream Benzene and Propene to rise. In addition to the Russia-Ukraine crisis, the resurgence of COVID in China has led to lockdown in the affected provinces, which has disrupted the supply chain of numerous commodities in the regional market. As Cumene have properties such as high boiling point and flammability, demand from the manufacturers of paints, enamels, thinners also rose on active pickup in offtakes from this market which has impacted the price of Cumene in the Asia Pacific region.
The disruption caused due to Russia-Ukraine war led to a rise in crude prices. As Benzene is the derivative of Crude and Cumene is further produced from Benzene, the price change in the crude oil market has severely impacted Cumene prices. Besides, Cumene is used as a raw material in the production of Phenol and Acetone. As the demand for Phenol from end-use industries has remained firm in the Asia-Pacific countries such as China, Japan, South Korea, the prices of Cumene have continued to rise.
Due to the resurgence of COVID outbreak in China, severe lockdown restrictions were implemented in the country due to which the import and export activities have been disrupted across the international market. As China is a major importer of Cumene, the consumption of Cumene has declined in China due to the market closures in lieu of the Covid repercussions. The reduced consumption from China has marginally affected the overall demand in the global market. However, as the demand from counties like India, South Korea, Japan has remained strong, they have fairly counterbalanced the fall in import orders from China in the near term due to which prices of Cumene have continued to trace an upward trajectory.
In India, Cumene prices witnessed a week-on-week inclination of 1.69% in the final week of March. According to ChemAnalyst, “Cumene prices are likely to rise in the upcoming weeks due to the expectations of high demand from the end-use industries such as paints, packaging industries, plastics, thinners. In addition, skyrocketing crude prices amidst the Russia-Ukraine conflict are likely to contribute to increasing the input cost of Cumene.”