Fluoroelastomer Prices Experience Divergent Paths in European and US Markets Amidst Demand Fluctuations
- 24-Jan-2024 2:24 PM
- Journalist: Gabreilla Figueroa
As of the 3rd week of January, the price of Fluoroelastomer witnessed a notable fall. This decline is primarily attributed to lower bidding activities from suppliers, reflecting the contraction in the European economy. The reduced demand from downstream Automobile sectors and lower industrial activities have led to a slump in Fluoroelastomer demand in the European market. On the flip side, Fluoroelastomer prices in the US market witnessed a significant increase, driven by the strong economic performance attributed to impressive results in the Automotive and Aerospace industries downstream
In France, there was a slight decline in the price of Fluoroelastomer, reaching 50700 USD/MT FD – Le Havre, marking a decrease of 1.39% from past 2 weeks as of 3rd week of January. In the broader European market, Electric Vehicle (EV) incentives have been reduced, with Germany terminated its subsidy program in December, earlier than expected due to budget constraints. This decision surprised many, given the initial plan for subsidies to run until the end of the year. Prominent automakers such as VW, Stellantis, Mercedes, and Audi have committed to absorbing some or all of the EV incentive costs. France has also made significant adjustments to its EV incentives, excluding vehicles made in China, impacting the Tesla Model 3. With BYD making strategic moves in Europe and upcoming EV production in Hungary, the automotive sector is anticipated to experience additional pricing adjustments post-subsidies. Airbus delivered 735 commercial aircraft in 2023, reflecting an 11% increase from 2022 and demonstrating robust performance despite a challenging operating environment. The substantial order books for Airbus indicate a positive demand for Fluoroelastomer in the aerospace sector. All these key factors are influencing the demand for Fluoroelastomer in the European market, particularly in the downstream Automobile sector and Aerospace sector.
In the US market, the price of Fluoroelastomer witnessed a notable rise, reaching 35100 USD/MT FOB – USGC, marking an incline of 1.15% from past 2 weeks as of the 3rd week of January. The Automobile sectors and other industrial segments displayed robust performance. Positive performances were observed in the downstream Automobile and Aerospace sectors. Canada has consistently experienced underperformance in automobile sales in recent months, in contrast to the outperformance seen in Mexico. The overall increase in Fluoroelastomer prices was influenced by the rise in ex-quotation prices from suppliers, resulting in an upward trend in Fluoroelastomer prices during this respective period.
According to ChemAnalyst's anticipation, the price of Fluoroelastomer is expected to follow a bearish trend in the European market. This bearish outlook is based on the anticipation of muted growth in the sales of the Automobile sector, which will influence the demand for Fluoroelastomer. In contrast, the US market is currently witnessing outperformance, driven by the overseas trading partner's downstream market even, which may lead to a surge in the price of Fluoroelastomer in the upcoming sessions.