Polycarbonate Market Gains Stability in US and Europe, Contrary to the Falling Asia
Polycarbonate Market Gains Stability in US and Europe, Contrary to the Falling Asia

Polycarbonate Market Gains Stability in US and Europe, Contrary to the Falling Asia

  • 22-Feb-2024 4:56 PM
  • Journalist: Emilia Jackson

In the third week of February 2024, the global Polycarbonate market experienced varying trends in North America, Europe, and China. In North America and Europe, Polycarbonate prices remained unchanged as limited domestic demand and moderate supply conditions prevailed. The stabilization in prices was further supported by a relief in the freight industry, with global ocean freight rates correcting downward for the past two weeks. The slowdown in demand associated with the Chinese Lunar New Year holidays contributed to this correction, prompting shipping companies to optimize their operations amidst ongoing logistic challenges in the Red Sea. Despite weekly declines in rates, the persistent hurdles from the Red Sea crisis kept drops under control, maintaining rates significantly above pre-crisis levels. The global container freight index remains unchanged from the previous week, contributing to the overall stable conditions.

Conversely, China witnessed a 2.4% decline in Polycarbonate prices during the same period. This downward trend was primarily influenced by strategic negotiations between Chinese buyers and Middle Eastern suppliers. These suppliers had increased their offers, citing logistical challenges arising from the Red Sea crisis. Despite the hurdles, Chinese buyers adopted a cautious approach, refraining from rapid restocking due to the availability of ample cargo in the region. The ongoing festive season, characterized by reduced business activities and a slowdown in construction and manufacturing projects, further contributed to the subdued market conditions in China. Specifically, demand for Polycarbonate, especially in sectors like construction and automotive, experienced a decline during the Chinese New Year festivities, exerting downward pressure on prices.

The Lunar New Year festivities also impacted production plants in China, with shutdowns occurring at several facilities, including Covestro's Caojing site in Shanghai, Sinopec Mitsubishi Chemical Polycarbonate in Beijing, and Mitsubishi Gas Chemical Engineering-Plastics in Shanghai. Additionally, many manufacturing facilities operated at reduced capacity as workers took time off to celebrate the festival. This led to a temporary oversupply as demand diminished during the holiday period.

According to ChemAnalyst, the price of Polycarbonate may experience a decline in the upcoming weeks. Initially, the Red Sea crisis had led to a rapid increase in freight costs, subsequently impacted the price of Polycarbonate. However, the persistent challenges arising from the Red Sea crisis have been effectively managed, preventing significant drops and maintaining rates well above pre-crisis levels. This situation indicates a stabilization in the market. As a result, there is a possibility that the prices of Polycarbonate may increase due to the smooth flow of cargoes, strengthening the overall supply across the global Polycarbonate market. The ongoing management of hurdles from the Red Sea crisis is expected to create a more balanced and controlled market environment, influencing Polycarbonate prices in the coming weeks.

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