German Phosphonate Prices Show Bearish Trend Amidst Sluggish Demand and Economic Challenges
- 14-Sep-2023 2:37 PM
- Journalist: Francis Stokes
Hamburg, Germany: The Phosphonate market in Germany is experiencing a downturn owing to poor demand conditions. The downstream demand from the detergent, cleaning, and water treatment sectors remained low, with slow consumer inquiries in local and overseas markets. The market transactions of Phosphonate were limited, and there was a strong wait-and-see customer mentality in the region.
According to the surveys done by various market participants, the chemicals industry's confidence has declined month-on-month in a row. This is owing to a considerable decline in managers' output estimates, which decreased in July 2023 compared to June 2023. Basic chemicals continued to fall by double digits in individual areas of the chemicals industry.
While completed product inventories fell marginally in July 2023, they are still considered above average. The business position is now slightly stable in August for the Phosphonate and other specialty chemicals market, but it is not satisfying because the chemicals business climate continues to exhibit chronic difficulties. Despite a major drop in energy costs over the last year (July 22-July 23), the industry is nevertheless suffering from a lack of consumer demand.
The prices of Phosphonate DTPMP-CFR Hamburg (Germany) dropped by 6.0% in July to USD 1686/MT from USD 1794/MT in June. Further, the prices of Phosphonate again declined by 2.5% in August from that in the previous month.
Most nations' first-half performance has been poor since the spillover effect of the 2022 energy crisis has adversely impacted most commercial sectors in 2023. The Netherlands and Germany were among the EU nations most hit by the energy crisis, and both are currently experiencing output declines of more than 15%.
Furthermore, the production costs of Phosphonate are also declining as the cost support from the raw materials is weakening. The prices of upstream Phosphorus Trichloride decreased in the German market. Owing to this, the manufacturing costs of Phosphonate have lowered this month, too.
The European chemical sector started very poor in 2023: domestic and export demand remained weak. Thus, production fell considerably in the first six months of 2023 compared to the previous year.
According to the ChemAnalyst database, the Phosphonate market in Germany is expected to demonstrate further decline as the demand outlook is presumed to remain bleak as the Phosphonate demand as a water treatment agent in the industry is expected to decrease further, with slower product offtakes projected. The second half of 2023 is predicted to be difficult for chemical industries, according to the Oxford Economics Report, as poor industrial demand continues to weigh on new orders of Phosphonate.