Paraffin Wax Prices Rise Amidst Looming Optimism of Arriving Chinese Lunar New Year

The global Paraffin Wax market witnessed a notable price surge in January 2024, primarily driven by the consistent rise in the cost of essential feedstock Crude Oil and a steadfast demand. Further, the escalation in Paraffin Wax prices can be attributed to disruptions in the supply chain, resulting from trade uncertainties and adverse weather conditions.

In the North American market, the cost of Paraffin Wax has experienced a notable increase due to heightened trading activities and increased interest from buyers. Reports from reliable market sources have indicated a significant uptick in Paraffin Wax transactions, reflecting an elevated level of buyer engagement and a readiness to make purchases in the upcoming year. The demand from the Asian markets, specifically in candle making and cosmetics, notably from China and Indonesia, remains robust, especially with the approaching Chinese Lunar New Year celebrations. The surge in prices can also be attributed to material shortages within the North American market and uncertainties in trade. The recent Arctic Blast, bringing extremely cold temperatures to the US, has resulted in reduced production activities and temporary closures of numerous manufacturing units, leading to a scarcity of supplies. Additionally, ongoing attacks on shipping have compelled vessels to divert their routes around the African Cape of Good Hope, resulting in increased voyage durations and costs. Some customers are contemplating transloading options and redirecting shipments via the West Coast, potentially causing congestion in West Coast US Ports and necessitating diversions to other West Coast Ports.

Similarly in the Asian marker, Paraffin Wax witnessed a significant surge in January 2024. Two key factors played a pivotal role in driving up Paraffin Wax prices in the region including a shortage of available material in the market and strong demand from the domestic sector. The robust demand for Paraffin Wax was evident across various industries, including domestic candle making, cosmetics, and the personal care market, particularly in anticipation of the approaching Lunar New Year celebrations in the country. Simultaneously, a scarcity of material within the Chinese market was notable due to the temporary reduction in production activities across numerous manufacturing units. Unfavourable weather conditions, including heavy fog, snowfall, and freezing rain, compelled many producers to temporarily suspend their operations, leading to a less availability of the material within the country.

As predicted by ChemAnalyst, a continued decrease is anticipated in the global Paraffin Wax market. This decline is primarily ascribed to a reduction in demand from prominent end-user sectors, particularly the candle making, cosmetics and personal care industry, coupled with the accumulation of inventories amid ongoing trade uncertainties.