The paraformaldehyde (PFA) market in Europe continued with unchanged prices due to several factors: unchanged production costs, ongoing summer holiday season, muted market activities, and uncertainty amid the US tariffs on European goods. However, the logistical front experienced some disruption, which was not sufficient to impact the prices of PFA amid the presence of ample inventory levels for the demand from the downstream agrochemical sector.
In Europe, the PFA market continued to showcase stability in its trend during the week ending on August 15. The stable market sentiments of PFA can be attributed to several factors, such as unchanged production costs amid the stable prices of the feedstock formaldehyde. Furthermore, the ongoing summer holiday season in Europe resulted in muted market activities, providing support to the current market sentiments of PFA.
However, the start of the plantation season in Europe had the potential to increase the prices of PFA, but the ongoing muted market activities, stable production costs, and the presence of ample inventory levels resulted in the current market sentiments. These favorable factors made market players continue with their unchanged quotation, resulting in the stable prices of PFA in Germany. Moreover, the export demand witnessed a marginal decline, further limiting a surge in the market momentum. On the cost front, the input cost inflation continued to witness ease amid the declining oil prices and a comparatively strong Euro.
In addition, consumer confidence experienced a decline in August compared to the previous month. This showcases a surge in consumer pessimism amid the ongoing economic uncertainty due to the trade tariffs on European goods.
Furthermore, the Kiel Canal Authority announced the conclusion of long-term maintenance on the Big New Locks at Brunsbuettel. This week, at Brunsbuettel and Kiel, all Big New Locks were completely operational, which provided the surety of ease in transitions without any delays. Moreover, at the Hamburg port, the Berth 1 construction started on August 11, which resulted in the reduced berth space for the three weeks. The vessel waiting time during the 7-day average is 1.67 days, and the CTA and CTH utilization rates are 74% and 90%, respectively. At CTB, due to the berthing line, the waiting time is up to 5 days, resulting in congestion. These operational challenges are expected to result in competition among feeders for the limited slots.
However, these logistical challenges had a limited impact on the prices of PFA during this week, amid the presence of ample supply, during the ongoing summer holiday seasons, resulting in muted market activities.
As per ChemAnalyst, the PFA market in Europe is expected to continue to be stable in its prices amid the expected continuation of the holiday season. Moreover, the ongoing market uncertainty regarding the trade tariff is expected to limit the PFA market activities in the upcoming few weeks.
