Price Trends of Fatty Alcohol Progress in a Northward Direction in the Early March 2023
Price Trends of Fatty Alcohol Progress in a Northward Direction in the Early March 2023

Price Trends of Fatty Alcohol Progress in a Northward Direction in the Early March 2023

  • 14-Mar-2023 2:18 PM
  • Journalist: Sasha Fernandes

Jakarta, Indonesia: The prices of Fatty Alcohol has observed to be on an uptrend amid rising consumption from the downstream personal care sector and an upshift in upstream Palm Oil prices. The pushback after a continuous decline in the recent month has strengthened the market sentiments of Fatty Alcohol. In addition, the largest Palm Oil producer, Indonesia, has suspended two-thirds of its Palm Oil exports to secure domestic supply to remain competitive with cooking oil in the domestic region.

As per the market sources, Global Green Chemicals Plc (GCC), a biochemical arm of PTT Global Chemical, has planned to spend 2.5 Billion Baht on developing a new oleochemical-based product to general more profit margins in Thailand. The five million Baht will be entirely dedicated to boosting the production efficiency of its three main products, Fatty Alcohol with Refined Glycerin and Methyl Ester.

Furthermore, The increasing demand from the downstream personal care sectors and the depreciating value of the Malaysian ringgit have both led to an increase in the price realizations of Fatty Alcohol in Malaysia. However, as reported by the Malaysian Palm Oil Board.,  the total Palm Oil inventories have been reduced by 6.56 percent to 2.11 million tonnes in February 2023 from 2.26 million tonnes reported in January in the world's second-largest upstream Palm Oil producer.

On the other hand, in Indonesia, an industry official of the Indonesian Palm Oil Association has quoted that "Palm oil production in the world's largest producer is also likely to fall marginally this year due to the weather and a lack of fertilizer use at smallholder farms." Although the market participants have said that the existing Fatty Alcohol inventories are adequate to meet the downstream demand, they might experience an inventory shortfall of Fatty Alcohol due to the faster-rising demand in the ASEAN nations.

According to ChemAnalyst, the adverse weather conditions brought on by El Nino in Indonesia and extensive flooding across Malaysia will likely elevate the upstream Palm Oil costs, and as a result, the production costs of Fatty Alcohol will rise in the near term. On the other hand, The West's major economies may have recessionary worries due to sharply rising interest rates to fight rising inflation, which might cause Fatty Alcohol demand to stay moderate in the forthcoming weeks.

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