n-Heptane Experienced a Downfall in Cost in China Since the Second Week of December 2022
- 13-Jan-2023 2:24 PM
- Journalist: Kim Chul Son
During the third quarter of 2022 in China, a number of upstream companies involved in the processing of n-Heptane were forced to limit or reduce their production rates as the zero Covid strategy was implemented. This resulted in a very dull market for n-Heptane, and downstream companies that produce textiles, electronics, and plastics were forced to reduce their manufacturing activities for the same reason.
However, the price of n-Heptane in China rose significantly in the first two months of the fourth quarter of 2022. This upsurge can be attributed to a number of factors, including a resumption of production across the country, an increase in demand from businesses downstream for this product, etc.
According to ChemAnalyst's findings, n-Heptane prices in China have increased by nearly 5.32 percent per MT over the final quarter of 2022. Downstream businesses were able to continue investing in their products without having to worry about rising raw material costs.
The price of n-Heptane increased at a time when many people began to worry about the health of the chemical industry; Some believed that because of its attention to pollution, China might implement more rigorous environmental policies that would harm company profitability. On the other hand, the fact that no new laws or regulations have been enacted has allayed these concerns.
However, since the second week of December 2022, n-Heptane has witnessed a cost reduction. Because of the reinforcement of Covid – 19 curbs by various provincial governments, production activities in upstream and downstream companies have been severely affected.
The reduction in n-Heptane production has not been sufficient to maintain the commodity's prices up to this point because of lower demand. Consequently, material availability in warehouses and inventories has met overall demand.
As on 6th January 2023, n-heptane was being traded at USD 1,700 per MT on FOB – Qingdao basis.
As a result, ChemAnalyst anticipates that the price of n-Heptane will continue to fall this month by up to 4.5 percent per MT due to the anticipated average procurement orders from electronics and footwear companies, which are the primary users of this product. Due to a lack of production activity in upstream companies, it also anticipates a reduction in export volumes of this commodity.