Global supply cuts and rising input cost induced an uptrend for 2-Ethyl Hexanoic Acid in Europe.
- 07-Jan-2022 6:10 PM
- Journalist: Francis Stokes
2-Ethyl Hexanoic Acid (2-EHA) market in Europe is shrouded in uncertainty due to limited availability. Market sources have begun to note insufficient supplies of the commodity, prompting them to raise their offerings in response to steady to solid inquiries from the domestic market. In the European market, 2-Ethyl Hexanoic Acid has been on a rise for some months, owing to strong downstream demand and consumption, as well as limited production.
Prices of 2- Ethyl hexanoic acid have continued to rise due to exceptional increases in energy prices, settling at USD 4285/tonne FOB Hamburg in December. Because natural gas is Europe's primary energy source, and the entire continent is experiencing sharp increases in material costs. Analysing the global phenomenon, global key players have been dealing with rising input costs, which has put their profits at risk at a time when inflationary pressures are already reducing their profits. OQ Chemicals' previous announcement about raising 2-EHA prices by USD 500/MT for the global market will take effect in January, putting an end to any speculation.
The increase in pricing can be understood because of high underlying demand around the world and a scarcity of material in the market. Perstorp AB, a significant manufacturer of 2-Ethylhexanoic acid, increased EUR180 /MT in Europe, USD 0.10/lb in USA, USD 220/MT for the rest of the world, due to raw material shortage and to satisfy market dynamics, price increases, and end user demand. The company's profitability has been impacted by logistical restrictions and cost increases this week.
As per ChemAnalyst “ In the coming months, 2-Ethyl Hexanoic Acid is likely to hold its ground in both Europe and the global market. Also, the concern of trade disruption caused by the COVID spread could cause an imbalance in the international market, affecting the pricing dynamics of 2-Ethyl Hexanoic acid even more. Furthermore, increased input costs may prevent the price from falling. To summarise, 2-Ethyl Hexanoic Acid prices are projected to continue high for the foreseeable future, at least until the end of Q1 2022.”