Prices For Chinese Polyurethane Resin to Rise at the End of February 2023
Prices For Chinese Polyurethane Resin to Rise at the End of February 2023

Prices For Chinese Polyurethane Resin to Rise at the End of February 2023

  • 16-Feb-2023 2:41 PM
  • Journalist: Gabreilla Figueroa

Polyurethane (PU) Resin prices witnessed positive market sentiments with a rebound in demand from the downstream sector in the Chinese market. Meanwhile, volatility in upstream crude oil prices and an increase in the price of feedstock TDI (Toluene Diisocyanate) resulted in limited commodity production while increasing import pressure from other Asian countries. The improving Chinese economic outlook turned the domestic offers in the downstream automotive industry on their side in mid-February 2023, supporting the product's pricing trajectory.

With the end of the Spring Festival holidays in February 2023, the feedstock TDI prices began rising slightly, and as per the latest insights, Covestro and BASF increased commodity prices with a shortage of stocks and limited production activities amidst a shortage of oil supplies in the country. According to reliable sources, Wanhua Chemical announced on February 1 the permanent shutdown of its old feedstock TDI production plant in Fujian. Therefore, the PU Resin pricing dynamics in China were primarily impacted by the elevating input cost pressure on the product market players this week, and subsequently, PU Resin trading continued to be firm in the downstream sectors in mid-February. Thus, the price of PU Resin was assessed at USD 3665/MT FOB Shanghai (China) for foam grade, with a slight weekly increase of 0.4% in the week ending February 10, 2023.

The Chinese upstream TDI price is expected to show a further high in March 2023, and the recovery in the PU Resin demand in the downstream sectors is likely to impact the commodity's price movement in China. However, on the supply side, production capacity might increase in the feedstock TDI market, impacting the PU Resin input costs.

As per ChemAnalyst, prices of PU Resin may further increase in March 2023, owing to the surge in demand from the downstream automotive sector across the Chinese market. Meanwhile, the impact of OPEC's oil output cut is expected to persist, with global upstream crude oil costs fluctuating at high levels in 2023, putting upward pressure on PU Resin prices.

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