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Lacklustre Downstream Demand Puts Pressure on Nonylphenol Ethoxylates Prices in mid-Q2 of 2023
Lacklustre Downstream Demand Puts Pressure on Nonylphenol Ethoxylates Prices in mid-Q2 of 2023

Lacklustre Downstream Demand Puts Pressure on Nonylphenol Ethoxylates Prices in mid-Q2 of 2023

  • 25-May-2023 4:07 PM
  • Journalist: Xiang Hong

Since the start of May 2023, the prices of Nonylphenol Ethoxylates have been witnessing a slight upward trend across the Western and Asian markets. The labor day holidays in China and rising interest rates in Western markets have weighed on the Nonylphenol Ethoxylates market sentiments. The inquiries from the downstream surfactant and detergent industries have also been moderate and insufficient for high-price operations for Nonylphenol Ethoxylates. According to financial statistics given by Dow, one of the largest makers of Nonylphenol Ethoxylates, its net sales were $11.9 billion, a 22% decrease from the previous year, indicating reductions in all operational areas.

The ChemAnalyst database has shown that the prices of Nonylphenol Ethoxylates demonstrated a modest increment of USD 30 per ton in the week ending 19th May, compared with the prices observed at the start of this month. The persistent inflationary pressures have been impacting purchasing power of the end-use industries. It is also predicted to continue high in 2023 at 6.2%, above the ECB's (European Central Bank)  2% objective. To combat this, the ECB hiked its main policy rate seven times from June 2022 to May 2023, totaling 375 basis points. The cost support from upstream Ethylene Oxide was also higher in the given timeframe. Furthermore, the inquiries from downstream surfactant and detergent industries were also coming at a slower pace, reported by market participants.

The Chinese manufacturing sector has also been operating under pressure amid the limited offtakes from the downstream surfactant and detergent industries. The prices of input energy materials have also been trending lower, weakening the market fundamentals of Nonylphenol Ethoxylates in the domestic market. Moreover, according to market sources, an estimated 1.16 million bpd less oil will be produced voluntarily from May through the end of the year, according to producers including Saudi Arabia, the UAE, Iraq, Kuwait, Oman, and Algeria, which might exacerbate the supply-side concerns for its downstream derivatives.

According to the pricing intelligence of ChemAnalyst, the prices of Nonylphenol Ethoxylates might progress in a downward direction in the wake of tepid demand from the downstream fundamentals. The ongoing economic conditions in Western markets are also not likely to improve and will continue to weigh on the purchasing power of the end-use industries. In addition, the decreasing prices of energy materials will also prompt the production costs of Nonylphenol Ethoxylates to settle lower across the regional market in the forthcoming weeks.

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