n-Propanol Prices Show Bearish Trend in Southeast Asia Amid Declining Consumption Rate
- 30-Oct-2023 6:55 PM
- Journalist: Yage Kwon
The prices of n-Propanol in South Korea experienced a downward trend in October 2023. This was primarily due to a decrease in demand from buyers following the Chuseok Holidays, coupled with an ample supply of n-Propanol in the market. The orders for n-Propanol remained moderately low from the herbicides and insecticides manufacturers amid increased availability of supplies as the buyers had increased their stocking activities last month before the Chuseok holidays for the Autumn agriculture season.
Last month, the procurement activities of n-Propanol improved from the regional buyers before the Chuseok Holidays. As per the sources, South Korea's manufacturing Purchasing Manager's Index improved but remained slightly below 50 at the end of September 2023, indicating a slowdown in contraction in the manufacturing sector activities. After the holidays, offtakes declined from the regional buyers, which raised the product inventory levels in the country.
At that time, cost support was high on upstream Ethylene in the first half of September 2023 due to an escalation in Crude Oil prices because of the production cuts by OPEC+ and Russia. However, cost support eased on upstream Ethylene towards the end of September amid a decline in upstream Crude Oil prices. It reduced the production costs of the product.
In October 2023, the n-Propanol trading activities declined amid cautious buying activities from buyers due to sluggish offtakes from herbicide manufacturers amid a decline in Autumn season applications in the agriculture sector.
In the latter part of October, speculations about supply chain disruptions in the Middle East due to conflicts between Israel and the Palestinian Islamist Group stabilized, enhancing the availability of feedstock in the market. It eased the cost support on upstream Naphtha and reduced the production costs of n-Propanol. At the same time, the cost support was stable on upstream Ethylene amid moderate demand from Polyethylene industries.
Simultaneously, the consumption rates of n-Propanol declined from insecticide manufacturers, with the reduced application in the Agriculture and Horticulture sectors amid a decrease in global temperature negatively impacting the offtakes, and inventory levels remained firm in the market. Meanwhile, inquiries were moderate from the Pharma Sector.
According to the ChemAnalyst data sources, the n-Propanol price in South Korea dropped almost 4% during the month and hovered at USD 885/MT at the end of October 2023.
As per the estimation, the n-Propanol demand will likely remain stable from the regional buyers. The consumption rates of cleaning agents will improve in some countries like India amid the festive season. Consequently, offtakes may increase in the regional market. At the same time, production costs will remain firm due to high energy prices during winter and raise the market prices of n-Propanol during the mid-quarter of Q4, 2023.