Dwindling Consumer Demand Drags Down Mixed Xylene Prices in Europe and the US
- 27-Sep-2022 2:54 PM
- Journalist: Nicholas Seifield
Mixed Xylene prices have weakened in Europe and the US market. The high production cost in Germany led to the demand drop, while in the US, the inventories are high with sufficient product availability, weakening pricing sentiment.
Mixed Xylene prices have been dropping continuously in the German market due to the weak demand from consumers. The high energy prices caused by the suspension of Natural gas supply from Russia inflated the raw material prices resulting in poor demand from the domestic market. Also, the rising cost of living because of the high inflation rate led to a drop in purchasing activities in Germany. Thus, on the back of weak purchasing, the manufacturers of Mixed Xylene and its downstream derivative PET have reduced their operating rates. Hence, the sufficient availability of the product led to the drop in Mixed Xylene prices by 3.9%, with a declination of USD 44/ MT FOB Hamburg on 23rd Sep.
The continuous port congestion in the UK brought by the laborer's strike has been affecting the supply chain and resulting in the piling up of the product in the warehouses. However, the delay in supply has been prompting buyers from the international market to seek supply from other countries. Besides, the downstream manufacturers have canceled the contractual prices and have been looking forward to the spot prices. Therefore, the overall fall in the market led the inland traders to decline the prices of Mixed Xylene.
In addition, the Mixed Xylene prices are falling in the US domestic market along with the declining WTI Crude values. The Purchasing Manufacturing Index (PMI) is below 50, resulting in shrinking business activities in the US. However, the inventories were high, but the demand was weak, ushering in the Mixed Xylene prices to slip.
According to ChemAnalyst, the price of Mixed Xylene will likely continue to decrease in the coming weeks. The downstream manufacturers might consistently follow the spot prices in Europe. Also, the labor strike in the UK is likely to persist till the first week of October. Whereas in the US, the railroad workers are likely to strike for high pay in the coming weeks, which might hamper the supply within the country and result in a drop in the Mixed Xylene prices.