Global PU Resin Market Players Expect a Rise in the Q2 Earnings
- 10-May-2023 5:14 PM
- Journalist: Emilia Jackson
The global Polyurethane (PU) Resin market expects a quarterly surge in earnings as the primary participants, such as Covestro and Huntsman, experience slow improvement in the downstream demand in the construction and automotive industries at the start of Q2 of 2023. In the previous quarter, sellers had attempted to increase prices due to concerns about the market's firmness, but the price push proved unsuccessful, and PU Resin prices stabilized in April. The current prices resulted from a combination of factors, such as a slow increase in the buying interest and inadequate supplies amidst upstream crude oil price volatility in the market.
Due to the modest improvement in the region's construction industry, the PU Resin market in North America is experiencing continuous destocking activities throughout April 2023. Huntsman reported reduced profitability in the first quarter, owing to the lower sales volumes, lower MDI margins, and the negative impact of weaker key international currencies against the US dollar. However, Huntsman anticipates that destocking will continue throughout the second quarter, influencing PU Resin pricing dynamics. Huntsman is optimistic about the future of the PU Resin business in the American market, as it is likely to benefit from the construction sector growth and the Inflation Reduction Act, which provides incentives for climate change and sustainability projects.
In China, the PU Resin segment witnessed recovery, with rising demand in the construction and other consumer markets. Meanwhile, the PU Resin market in Europe has stabilized, and destocking has subsided.
As per ChemAnalyst, Global Crude Oil supplies are projected to affect the global pricing dynamics of PU Resin in May 2023. Moreover, Huntsman expects second-quarter earnings to rise for the US-based PU Resin value chain as the company expects destocking will continue through most of the second quarter amidst a slow recovery in the downstream consumption of the PU Resin.
