Category

Countries

European Ethylene Oxide Prices Rebound Amidst High Feedstock Cost
European Ethylene Oxide Prices Rebound Amidst High Feedstock Cost

European Ethylene Oxide Prices Rebound Amidst High Feedstock Cost

  • 06-Feb-2024 6:25 PM
  • Journalist: Jai Sen

Hamburg (Germany): After a prolonged period of stagnation across the European market, the Ethylene Oxide market showed signs of firmer sentiments during the first week of February 2024. The high raw material prices and insufficient inventories have supported the prices, leading to an uptrend in the regional market. Nonetheless, this has had a limited bearing on the prices of Ethylene Oxide. Prices of Ethylene Oxide have increased by USD 20/MT in the German market. Global crude oil prices have been strong amid geopolitical issues coupled with the bad weather in the US. Market sources report that Brent crude oil climbed to its highest level in more than two months last week, marking the biggest weekly increase of 6.3% since the Israel-Hamas conflict erupted in early October. These factors have led to bullish market sentiments for Ethylene Oxide among the manufacturers.

In addition, the supply of Ethylene Oxide is currently constrained, reflecting the impact of uncertain supply caused by the Red Sea crisis. Several Ethylene Oxide producers have cut their operating rates in response to an overall decline in demand. The German manufacturing Purchasing Manager Index was slightly up from 43.3 in December to 45.5 in January 2024, although firmly in contraction territory, reflecting a deterioration in new orders and output. Overall, the availability of finished stock of Ethylene Oxide was limited, prompting the manufacturers to revise their quotations.

Demand for Ethylene Oxide, however, remained inactive from the downstream Ethoxylates and Monoethylene Glycol industry due to slow consumption from the end-user sector. This was insufficient to drive the price realizations of Ethylene Oxide at the lower end in the domestic market. The Ifo business climate index dropped from 86.3 points in December to 85.2 in January 2024, reflecting a further deterioration in sentiment among German companies at the beginning of the year. Additionally, leading Ethylene Oxide manufacturers such as BASF anticipated group sales for the entire year of 2023 to amount to €68,902 million, falling below BASF's projected range of €73 billion to €76 billion and also trailing behind the average analyst forecasts for 2023. As a ripple effect, prices of Ethylene Oxide FD Hamburg settled at USD 1510/MT during the week ending 2nd February 2024.

According to ChemAnalyst expectations, European Ethylene Oxide prices might exhibit upward stability in the coming weeks. The spot market demand is anticipated to improve as buyers steer away from the contract market amid uncertainties. On the other hand, feedstock Ethylene prices are likely to increase, supported by high energy values, but they might not impact the Ethylene Oxide prices at a broader level.

Related News

EPA Launches Crackdown on Toxic Air Emissions from Over 200 Chemical Plants
  • 10-Apr-2024 1:45 PM
  • Journalist: Jung Hoon
Ethylene Oxide Prices Revised Down on Restricted Buying Interest in Europe
  • 04-Apr-2024 4:02 PM
  • Journalist: Jacob Kutchner
Dow to Construct Major Carbonate Solvents Plant on US Gulf Coast
  • 26-Mar-2024 5:12 PM
  • Journalist: Yage Kwon
BASF Breaks Ground on Methyl Glycol Plant at Zhanjiang Verbund Site, China
  • 22-Mar-2024 3:26 PM
  • Journalist: Jai Sen