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Mixed Xylene Prices Continue to Show Downtrend in Asia and Europe Amidst Lukewarm Demand
Mixed Xylene Prices Continue to Show Downtrend in Asia and Europe Amidst Lukewarm Demand

Mixed Xylene Prices Continue to Show Downtrend in Asia and Europe Amidst Lukewarm Demand

  • 12-Sep-2024 3:35 PM
  • Journalist: Shiba Teramoto

Hamburg, (Germany): The Mixed Xylene market in Europe and Asia has been on a downward trajectory for nearly two months due to a combination of abundant supply and subdued demand which have been exacerbated by economic headwinds in the region. Despite the decline in energy prices, feedstock prices have been observed on the higher end, but it had a minimal impact on the prices of Mixed Xylene.

Mixed Xylene prices in Europe’s largest economy, Germany, declined with a reduction in spot deal settlement during the first week of September. Market participants reported that softer premiums heard during the week were supported by a drop in crude oil prices. Conversely, feedstock Naphtha prices have consistently increased, Mixed Xylene offers were largely heard to have remained lower, with producers attributing this to a persistently weak market.

Additionally, demand for Mixed Xylene with market sources indicated largely unchanged buying interest, coupled with ongoing tepid gasoline blending and chemical spot demand which weighed down the prices of Mixed Xylene in the domestic market. Moreover, spot discussions were largely minimal with most deals for September already finalized last week. At the same time, export demand for Mixed Xylene was also soft amidst lukewarm downstream derivative demand, further reflecting bearish market sentiments. Thus, the prices of Mixed Xylene FOB Hamburg were settled at USD 760/MT, with a weekly decline of USD 40/MT at the end of the week of 6th September.

However, in terms of domestic production, the operating rates have continued to remain low in the backdrop of sluggish downstream demand. Also, German industrial production dropped 2.4% month-on-month in July from 1.7% in June. On a yearly basis, industrial production is down by more than 5%. Despite this, the current market supply of Mixed Xylene was sufficient as new orders declined, keeping the price downtrend in the domestic market.

On the other hand, the Mixed Xylene market started in September on a slower note in the Chinese market. The demand from the downstream paints and coating, gasoline blending along with lubricant industry has continued to remain average as consumption from the end-user sector has not significantly improved in the domestic market. Also, Chinese buyers are not in hurry to purchase import cargoes in spite of temporary bottoming out of prices, indicating that demand concerns continue to drive purchase decisions. Furthermore, Super Typhoon Yagi which made landfall in Vietnam and some parts of China was subsequently downgraded to a tropical storm also did not impact supplies significantly. Prices of Mixed Xylene Ex- Qingdao were settled at USD 780/MT with a week-on-week drop of USD 70/MT during the same time frame.

Considering sluggish demand and rising supply, ChemAnalyst anticipates the outlook for the Asian and European Mixed Xylene market remains gloomy in the short term with market players expecting additional room for decreases. Buying enthusiasm is quite muted, and producers are worried Mixed Xylene prices could drop further, so they are keeping away from committing to any shipments. Additionally, crude oil prices may decline in the forthcoming weeks if OPEC raises their output as suggested earlier which might ease the overall production cost of Mixed Xylene.

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