Feeble Downstream Inquiries Shift the Calcium Carbonate Price Trend in Southward Direction
- 30-Jan-2023 3:23 PM
- Journalist: Francis Stokes
The fears of a potential recession in Europe and slowing economic growth in the US have seeded significant challenges for the market growth of various bulk chemicals, including Calcium Carbonate. The global central banks have been easing their monetary policies, foreseeing a drop in inflation. The decrease in maritime transport expenses has also been a crucial factor impacting the market fundamentals of Calcium Carbonate in the regional markets.
In India, the prices of Calcium Carbonate have been continuously dropping since the second week of January 2023. The profit margins of the manufacturing firms have also remained subdued as the elevated production costs in the previous quarters have led to high-cost inventories. The market participants have emphasized that slower inquiries from the downstream construction sector have prompted them to reduce their offers to generate sales. In addition, the reduction in freight charges for procurement of Russian Oil at heavily discounted prices has also been reflected in the pricing dynamics of key commodities.
Furthermore, the data from a freight booking platform, Freightos, demonstrated that the costs of sending a container from Asia to the US, a demand-sensitive spot market, have been plunged by more than 80% for a 40-foot container. In addition, procurement from the end-use industries was also relatively weak, and the prices of Calcium Carbonate progressed southward in the US market. The ChemAnalyst database has shown that the prices of Calcium Carbonate were settled within the range of USD 715-705 per ton on a FOB basis.
According to ChemAnalyst, the prices of Calcium Carbonate may remain volatile in the regional markets. The demand from US and EU construction sectors has been pushing slower and could mitigate downside risks and sustain Calcium Carbonate market growth. Furthermore, the economic conditions in India have been improving as the significant government investments in infrastructure have provided a positive market outlook. It is anticipated that the demand from the downstream construction sector will also improve and strengthen the Calcium Carbonate market.