Global 2-Ethyl Hexanol Prices Show Volatility Amid Changes in Market Dynamics
- 03-Nov-2023 2:22 PM
- Journalist: Li Hua
Low demand from the downstream construction industry persisted for the 2-Ethyl Hexanol (2-EH) marketplace throughout October, keeping the price trend unchanged in this period. After witnessing the Golden Week of October celebrated in China, a consistent drop in orders for 2-EH was observed. As reciprocator actions, several enterprises have decided to lower their run rates of manufacturing units. Likewise, exporting nations, including Belgium and Germany, have faced a similar situation for 2-EH prices, which was associated with the subdued domestic and international demand during the Silver October 2023.
The 2-EH market in Belgium has stabilized after a sharp decline, with demand and supply roughly in balance. Demand for 2-EH continued to fall in October, with no new orders from the international market. A few major enterprises, such as Total Energies in Antwerp, Belgium, have decided to put their feedstock Propylene unit on Maintenance turnaround, having a capacity of 320,000 mt/year from early October 2023 till the next announcement, which shows a marginal outcome on the pricing trend of 2-EH. Declining order books and broader economic concerns further eroded business confidence, leading manufacturers to cut factory output. As a result, demand-supply fundamentals have remained stable, with the gap between supply and consumption unchanged and narrow enough to support the current price trajectory. Moreover, as per the data released by the European Central Bank (ECB), interest rates remained the same, worried about a possible recession in the Eurozone. It had raised rates many times to fight high inflation, which fell to 4.3% in September from 10.6% last year but is still above the ECB's 2% target. During this timeframe, the high rates have hurt demand from industries that use various commodities, such as 2-EH.
After the National Day holiday, celebrated in China, the 2-EH prices have negatively fluctuated and remained unchanged in October amid the weak and declining demand for the product in the regional market. Moreover, the drop in the market values has continued, with factories and suppliers lowering their shipping prices. Furthermore, China's feedstock Propylene production declined due to weaker demand from downstream industries, such as construction and PVC, which has been weakening in recent months due to poor enthusiasm and insufficient support for raw materials. All these relevant factors kept the stable price trend for 2-EH to be assessed at 1680 USD/tonne spot Ex-Shandong, China, throughout October 2023.
As per ChemAnalyst, November might be a month where prices of 2-EH in Belgium and Germany are expected to surge in response to the posted price increment by OQ Chemical. However, the Chinese market might not show any signs of positivity associated with poor demand and insufficient cost support from the feedstock Propylene prices in the upcoming month.