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EPDM Rubber Prices Dip in Early March Due to Suppliers' Destocking Actions
EPDM Rubber Prices Dip in Early March Due to Suppliers' Destocking Actions

EPDM Rubber Prices Dip in Early March Due to Suppliers' Destocking Actions

  • 21-Mar-2024 1:57 PM
  • Journalist: Harold Finch

In the US market, the price of the EPDM Rubber witnessed a downward trend in first half of March. This downside in the EPDM Rubber price is majorly attributed to the ample of inventories in the regional market. Despite witnessing outperformance in the Automobile and the Construction sectors and positivity in the overseas market the price continued to fall due to the lack of supplier’s action in the major accumulation of the inventories. Due to prevailed downturn in the price action of EPDM Rubber, the suppliers have continued to destock inventories in effect with the market witnessing the continuation of the Short buildup activities. These factors have cumulatively contributed to influencing the price of the EPDM Rubber in the US market.

In the US market, EPDM Rubber prices saw a significant decrease, dropping to 2725 USD/MT FOB-Texas, marking a decline of 6.03% in the first half of March. This price reduction occurred despite the rise in prices of major feedstocks like Ethylene and Propylene. However, the downstream Automobile market in the US remained resilient, with Light Vehicle (LV) sales experiencing notable growth of 9.2% year-on-year and 16.36% month-on-month in February, reaching 1.25 million units. This consistent growth trend, coupled with a strong performance in the Construction sector and an upturn in Manufacturing PMI, reflected positive industrial activities and demand for commodities from respective sectors. Although overseas markets showed moderate demand, suppliers continued the downward price trend due to inventory destocking, resulting in the decline in EPDM Rubber prices.

The current supply trend for EPDM Rubber indicates an abundance in the market, with participants eagerly anticipating reduced inventory accumulation in light of the expected market outlook. The consistent downward trend in prices is a significant factor dampening buyer enthusiasm for inventory accumulation, hinting at a potential trend reversal in the near future. The demand for EPDM Rubber is experiencing a notable uptick, driven mainly by heightened needs from the Automobile and Construction sectors. While Brazil has seen a decrease in demand in the Automobile sector, Mexico and Canada have shown moderate to robust demand, respectively. These trends in overseas markets are pivotal in shaping the overall demand landscape for EPDM Rubber. The buoyant demand from key sectors like Automobile and Construction, combined with varying patterns observed in international markets, underscores the global and sector-specific nature of EPDM Rubber utilization. As market dynamics continue to evolve, stakeholders are closely monitoring these trends to adapt their strategies accordingly.

As per the ChemAnalyst’s anticipation the price of the EPDM Rubber is expected to showcase bearish momentum in the upcoming sessions. This downside is majorly anticipated due to the continuation of the Short Buildup activities from the market participants. In this scenario the market witness aggressive selling from the suppliers where the buyers not enthusiastically bid for the inventories accumulation as till this week there is no sign of trend reversal to initiate bidding for the fresh accumulation. Apart from the upstream and the downstream market sentiments this factor will play crucial role in driving the price of the EPDM Rubber in near future.

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