N-Heptane Prices Continue Downward Trend Across Asia Amid Weaker Demand
N-Heptane Prices Continue Downward Trend Across Asia Amid Weaker Demand

N-Heptane Prices Continue Downward Trend Across Asia Amid Weaker Demand

  • 24-Oct-2024 11:00 PM
  • Journalist: S. Jayavikraman

As of mid-October 2024, n-Heptane prices in the Asia-Pacific region have continued their downward trend, extending a multi-month slide as weak demand and oversupply persist. The decline, evident across key markets such as China, South Korea, and India, is attributed to a range of factors, including the construction sector's slowdown, holiday disruptions, and weak procurement activities in downstream industries like paints, coatings, and adhesives.

In China, n-Heptane prices have been steadily falling over the last two months. The downturn in the construction sector has been a significant contributor to the decline. Total sales for China's top 100 real estate companies from January to September 2024 reached 2,969.94 billion yuan, marking a steep 38.8% year-on-year drop, further dampening n-Heptane demand from critical downstream sectors. Additionally, the Golden Week holiday in early October disrupted market activities, limiting procurement as new orders for manufactured goods fell at the fastest rate in two years. Traders reported sluggish market sentiment, with limited buying interest and low-end market offers rising, reflecting a bearish outlook for n-Heptane market.

In South Korea, n-Heptane prices have also mirrored this regional downturn. Prices remained under pressure throughout the second week of October, with oversupply and weak domestic demand contributing to the price declines. Petrochemical exports dipped by 0.6% year-on-year in September, totaling $3.84 billion, reflecting sluggish domestic consumption and reduced export activity. South Korea's overall export growth slowed to 7.5% year-on-year in September, down from 11.4% in August, as per the data released by Ministry of Trade, Industry and Energy (MOTIE). Additionally, the broader economic challenges weighed on market sentiment, with South Korea posting slower second-quarter growth at 2.3%, compared to 3.3% in the first quarter. New orders for South Korean-manufactured goods, particularly from overseas buyers, continued to decline, exacerbating the weak demand for n-Heptane from end-use sectors like construction.

In India, n-Heptane prices followed a similar trajectory, driven by reduced construction activity and weak downstream demand. Heavy monsoon rains and localized flooding, coupled with delayed government spending after the general election, have contributed to the muted demand for n-Heptane in the construction sector. Passenger vehicle retail sales in India plummeted by 19% in September, impacted by seasonal factors such as heavy rainfall and the 16-day lunar period, during which consumer purchases typically slow. Manufacturers continued to grapple with high inventory levels and sluggish consumption, leading to a supply-demand imbalance.

Looking ahead, n-Heptane prices across the APAC region are expected to remain under pressure in the coming weeks. Lower procurement activities, weak downstream demand, and the continued festive season in India are likely to contribute to a subdued market environment for n-Heptane, keeping prices low amidst ongoing oversupply and bearish sentiment.

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