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EPDM Rubber witness a surge due to elevation in the feedstock price and supplier’s price correction
EPDM Rubber witness a surge due to elevation in the feedstock price and supplier’s price correction

EPDM Rubber witness a surge due to elevation in the feedstock price and supplier’s price correction

  • 26-Feb-2024 2:40 PM
  • Journalist: Patrick Knight

The price of the EPDM Rubber in the global market witnessed an incline trend as of 4th week of February from the 2nd week of February. This incline in the EPDM Rubber price is majorly attributed to the supplier’s activities of witnessing in a destocking trend and the increase in the price of the major feedstock particularly Ethylene and Propylene. Despite the downstream Automobile and the Construction sectors witnessing a lower demand the price of the EPDM Rubber witnessed a notable surge due to the price correction nature in the price action concept witnessed from the supplier’s end. These key factors have significantly played a key role in influencing the price of the EPDM Rubber in the Global market.

In the European market, particularly in the Netherlands, the EPDM Rubber market has experienced a notable surge. In the Western European downstream market, the selling rate for new passenger vehicles slightly decreased to 12 million units per year in January, with 901,000 vehicle registrations. Despite this, there was a significant year-on-year growth of 10.7% in January, driven by robust expansion in major West European countries. In the Netherlands, the manufacturing sector exhibited signs of stabilization and increased optimism, with new orders, output, and employment contracting at a slower rate. These economic factors have had a significant impact on the overall demand for EPDM Rubber in the European market. The European Central Bank, in its initial 2024 meeting, has maintained a record-high interest rate of 4.5% and is committed to sustaining sufficiently restrictive levels to address inflation concerns and potential economic challenges. The combination of positive growth in the automotive sector, signs of stabilization in the manufacturing sector, and the commitment to economic measures by the European Central Bank has contributed to the notable surge in the EPDM Rubber market in the Netherlands and the broader European market.

In the US market, the price of EPDM Rubber has witnessed a notable surge, reaching 2900 USD/MT FOB-Texas. This marks an incline of 1.37% as of the 4th week of February from the 2nd week of February. In terms of raw materials, the price of propylene remained stable, while the price of ethylene experienced an increase. In the United States, vehicle sales recorded a 5.6% monthly decline in January, totaling 15.0 million units. However, unadjusted sales volumes showed a 2.8% increase compared to the previous year, reaching 1.08 million units. The average daily selling price (DSR) over a 25-day period decreased from 43,622 to 43,042, marking the first year of decline in DSR over the last sixteen months. Sales of passenger cars grew by 1.4% year-on-year, and light vans increased by 3.1% year-on-year. The share of light trucks in last month's sales maintained its 80% share from January 2023. A positive development was observed in the construction sector. The overall positivity in economic activity and increased demand in foreign markets contributed to the price surge in EPDM Rubber during this week in the US market. The dynamics in the automotive and construction sectors, along with the broader economic trends, have played a significant role in influencing the pricing of EPDM Rubber in the United States.

According to the ChemAnalyst anticipation the price of the EPDM Rubber is expected to showcase stable to incline trend in the upcoming sessions. The anticipation is based upon the assumption of the outperformance in the US economy where the sectors are expected to showcase better demands for the EPDM Rubber. The outperformance in the Ethylene and the Propylene price will also be led to the increase in the production cost of EPDM Rubber. The global supply chain disturbance issue will also be the key factor of the increase in the price of the EPDM Rubber.

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