Erucic Acid Pricing Climbs in Europe, Production Rates Under Pressure
Erucic Acid Pricing Climbs in Europe, Production Rates Under Pressure

Erucic Acid Pricing Climbs in Europe, Production Rates Under Pressure

  • 09-Nov-2023 3:50 PM
  • Journalist: Timothy Greene

In October 2023, the price of Erucic Acid rose marginally by almost 2% in Europe amid the moderate availability of feedstock Rapeseed Oil supplies. The production rates of Erucic Acid were affected due to the weak availability of feedstock Rapeseed Oil supplies amid a decline in Rapeseed Crushing rates during the month. As per the sources, the harvesting and sowing rates of raw material Rapeseed got delayed amidst wet soil conditions due to increased rainfall in the central part of the region. Consequently, supply rates of Erucic Acid remained tight amid moderation in consumption rates from the downstream industries.

According to the market sources, the Eurozone's manufacturing Purchasing Manager's Index fell again in October 2023, indicating a further decline in the manufacturing sector activities. Consequently, the demand for Erucic Acid remained low as a precursor from the Biodiesel manufacturers amid moderately low transportation activities and a decline in biobased fuel consumption rates in the logistics sector during the month. At the same time, orders remained average from the Pharma sector and moderate from personal care product manufacturers. Furthermore, the buyers started the restocking practices before the arrival of winter. According to the ChemAnalyst data sources, the Erucic Acid prices in Germany witnessed USD 4782/MT at the end of October 2023.

Similarly, last month, the Erucic Acid prices escalated amid increased offtakes from buyers and stressed the availability of supplies. Sources say that the output of upstream raw material Rapeseed fell marginally in Europe during August in comparison with the last month due to a decline in crop yield and area in key cultivating countries, i.e., France and Hungary, and stressed the availability of feedstock Rapeseed Oil in the region. It negatively impacted the production rates of Erucic Acid during September 2023. Supply rates remained inadequate from suppliers amid improved offtakes from the downstream buyers. Simultaneously, the supply chain activities were slightly affected because of the summer holidays in the region. Concurrently, orders for Erucic Acid were firm from the food sector and biodiesel manufacturers amid the increasing energy crisis, which stressed the availability of supplies in the region.

As per the assessment, the prices of Erucic Acid will remain firm till the end of the year. The consumption rates from Biodiesel manufacturers will improve as fuel demand increases during the winter. Meanwhile, the production rates will remain moderate as it is the mid-season for raw material (Rapeseed) cultivation, and wet soil conditions amid increased rainfall have delayed the sowing and harvesting time for the oil seed crop. Thus, the production levels of both feedstock Rapeseed Oil and Erucic Acid are expected to be hampered in the region.

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