Fear of Recession in the US Economy Results In the Slumping Acetone Prices
- 06-Jul-2022 4:20 PM
- Journalist: Nicholas Seifield
Acetone prices have been witnessing a fall in the US market this week. The easing crude oil prices and the weak purchasing activity is the major reason behind the price drop. Moreover, the fear of recession is affecting the economic growth of the US market.
The US market has been witnessing a tumbling crude oil price. The oil price slip amidst the tight supply of the product has been affecting its derivatives prices. The cost of Crude in the local US market has been dropping below $100/ barrel due to the recession. Crude is the primary raw material to produce Acetone; hence, the decrease in Crude price has been affecting Acetone pricing directly.
As a result of increasing Federal interest rates, the US dollar was jumping high compared to the other currencies. Because of the rise in dollars, other international countries have been backing off from importing goods from the USA due to its high export charges. The weak buying activities from the international markets ushered in high inventories of Acetone in the local market. Thus, the aforementioned reasons worried the stockholders and led to stashing the products. Furthermore, the traders were bargaining with existing products, ushering in the declining Acetone price trend.
Additionally, the demand from the domestic market is slumping with poor purchasing from the consumer side. The requirement from the downstream derivatives Bisphenol A and Methyl Methacrylate is also not taking up the pace, further impacting the Acetone market negatively. Therefore, Acetone prices in the US market continuously dropped by approximately 1% with a decrement of $10/ tonne from 24th June to 1st July.
The Acetone values are likely to drop continuously in the forthcoming weeks, as anticipated by the ChemAnalyst team. The recession might affect the market growth, production and lessen sales activities leading to the overall decline in the economy. Moreover, strong dollar trading might not ease laying a foundation for the declining demand from the international market. The further inventories of Acetone may halt the availability of previously stockpiled products.