Deterred Demand and Sufficient Supply Reduced the Global Ethylene Dichloride (EDC) Prices

Hamburg, Germany- Ethylene Dichloride (EDC) prices have declined this week with plunging feedstock Ethylene and Chlorine values. In Germany, the production cost among the manufacturing units of EDC remains affected, and operating rates have reduced due to oversupplies. Downstream PVC (Poly Vinyl Chloride) prices have shown a downward trend with lackluster demand and tepid purchasing appetite. To maintain the profit margins, EDC suppliers show reluctance to issue further discounts on their product prices.

In terms of the feedstock market, Ethylene prices in the European region edged lower because of subdued regional demand trends and sufficient product availability. Prices remained on the lower end, prompted by falling feedstock costs, slack demand, and excess supply, mostly from overproduction.

Downstream PVC prices in Europe remained flat with subdued demand and lower bidding for new upcoming stocks. The end-use construction industry is also affected by higher utility costs and a bearish market on the demand front. End users hesitated to purchase the fresh stocks amid their sufficient inventory level.

In the US, spot trading activities have stabilized from the previous week with tepid demand and utilization of inventories from the end-user industries. Feedstock Ethylene prices have declined, prompted by weak market sentiments and sufficient product availability. In the US, logistics remains an issue with rail congestion and rising fuel cost.

According to ChemAnalyst, the price of Ethylene Dichloride will surge in the forthcoming weeks. The suppliers will utilize inventories, eventually increasing the product’s price. Rising energy and utility costs and recovering demand from the end-user industry will shoot up prices. In the US, the price hike will stem from reduced domestic availability and higher inflation, surging the prices of Petrochemical products. Transportation will remain a significant issue in the USA with rising fuel costs and rail congestion. Higher electricity and energy prices will surge production costs and force producers to increase EDC prices for the domestic market. Rising demand for raw materials will disrupt the supply chain dynamics of EDC and help shift some of the pricing power away from buyers toward sellers.